All Forum Posts by: John O'Leary

Hi Joe,
We’ve worked with several PadSplit investors to secure financing, and while these properties cash flow really really well, they do come with challenges—tenant turnover/issues and being the biggest ones.

One hurdle we've seen is that getting financing can be tricky since PadSplit rentals are still considered non-conforming by most lenders. Many traditional banks won't touch them, and even DSCR lenders will avoid them if the build out is done prior the securing long term debt. That said, we've been able to help investors secure creative financing solutions that work for this model.

If you decide to move forward, just make sure your financing strategy aligns with your long-term goals, and the properties are good fits for Padsplits model. 

Welcome to BP Tara, and congrats on taking action and joining a like minded community. 

@Tony Thomas @Shawn McCormick I'm in Orlando also. Always looking to connect with other local investors, realtors, etc. 

I haven't seen many value-add products, but there are solid options on the DSCR side. Maximum LTVs seem to be around 80%, with DSCR ratios typically needing to be around 1.20. Minimum loan amounts vary, but the product we work with most often starts at $500,000. I'll shoot you a DM

Hey Scott,

Welcome to BiggerPockets, and congrats on taking action toward building your real estate portfolio! It's awesome to see you channeling your sales and business skills into REI.Those strengths will definitely serve you well.

Building a solid team—from lenders and agents to property managers and mentors—is key to long-term success. Keep networking, learning, and most importantly, taking action when the right opportunities come up. Wishing you all the best on your journey—excited to see you grow!

Hey Robin,

Huge thanks for your service, and huge props for taking action in real estate! Love that you’re not just focused on building wealth but also on making a real impact for veterans—super inspiring.

Having a solid team around you is everything in multifamily, and being ready to jump on the right opportunity when it comes up is just as important. Sounds like you’re setting yourself up for success!

Wishing you the best on your journey—can’t wait to see you make moves

Hey Jorge!

Welcome to BP. I'm in Orlando, and wholesale property. What questions do you have? Shoot me a DM.

Find your cash buyers via propstream, batch leads etc. Skip trace the LLC and start a marketing campaign. The other thing to do is find a lender to partner with. Most "cash buyers" actually use some sort of financing.

I recommend working for someone while you sharpen your skills. See what they do right, and find areas you can improve upon then make the jump. It's sales and marketing. Best of luck! 

Understood. A key consideration here is the refinance process. When converting common living areas into additional bedrooms, many DSCR lenders might view the property as non-conforming, which could pose challenges. A common strategy used by investors, such as those operating through PadSplit, involves purchasing the property, completing basic rehab, refinancing, and then using cash for the interior build-out.

Another potential red flag, even without converting common areas, is the addition of individual locks on bedroom doors. Lenders and appraisers may see this as a sign of a room-by-room rental setup. To avoid problems, it’s best to add these locks after the appraisal on a turnkey purchase or after the refinance is complete.

Also, most DSCR lenders will assess the property's market rent as a single unit rather than the combined rents of individual rooms. If you're working with a community bank or a traditional lender, these issues may not be as relevant.