All Forum Posts by: Jonathan Blum

@Daniel Federico -  I have borrowed hard money and done a few conventional and business loans.  I thought I was into a portfolio lender, but it seems like they have dried up with "new regulations".  I'm not clear if they are just saying they don't want to lend more to me, or they actually have regulations governing their lending.  

@Andrew Postell - Thanks for your helpful questions.  I will use them when interviewing lenders.

@Montrell Brown - Do you guys have a program that turns your line of credit into a longer term product?  The problem I'm running into is that I turn all of my rehabs into rental units that I hold.  Getting long term financing on a property I already own has been problematic.  Thanks!

I am an experienced investor with more than a dozen properties, a few paid off, all cash flowing, 100% occupancy, not highly leveraged (less than 50%).  I have 8 mortgages (5 from banks, 3 contracts).  After investing in real estate and working a full time job for more than a decade, last year I decided to leave my full time work and work part time, largely living off the rental income that comes with managing my properties.  My credit score is in the high 700s and I have never missed a payment, defaulted on a loan, or any other credit ding. 

A few weeks ago I approached my credit union about getting a loan for a new home.  I asked for a pre-approval and was denied.  They didn't feel my passive income from my properties was sufficient to meet underwriting guidelines without a full time job on the side.  It is hard to believe.  If I was a new investor with no history, no experience, no track record, I get it.  But I have a long history and have had stable income from my properties for many years.

Have other experienced investors had this problem?  Do I need to pay cash or get contracts for everything moving forward?

Thanks for your advice.

@Daniel Zapata - I don't think raising rents is gouging at all.  It is important to keep up with the market you live in...  what galls me though is when landlords in one market (I work in The Dalles, OR) raise rents to another market (Portland, OR, for example).  It makes tenants upset and leaves them feeling angry toward all landlords, rather than only those who are gouging their tenants.  I work very hard to keep good relationships with all of my tenants, and have a very good track record to show for those relationships, both in terms of retention, as well as avoiding evictions and tenants leaving units in bad condition.  Communication and respect are key in my business.  Best of luck with yours!

@Kevin Moules - One of the reasons I self manage is that management companies need to be prescriptive in their approaches.  They don't have the freedom managing someone else's assets to apply these kinds of values or give tenants a say in this manner.  It also creates more work to have a dialogue, rather than just make a declaration.  Nonetheless, it is worth it to me to build these relationships and I have seen it work well over the past 10 years or so. 

This probably isn't as popular with the forum, but when I take over new properties and want to raise the rents, I'll go to the established tenants with some listings that clearly demonstrate market rates and ask them what they think is fair.  You'd be surprised how much good will it will buy you.  It makes you seem like less of a business person ("I want the highest return possible") and more of a market follower ("the market around here is rising and I want to make sure we keep up with the times").  When I have asked tenants what they feel is fair, they often suggest what I was going to raise it to anyway, and they have NEVER said, "if you raise our rent, we'll move out".  It builds faith and trust.

There is a HUGE disconnect between tenants and landlords in many cases, and this disconnect makes tenants feel like they are being commodified, rather than treated fairly.  Engaging them in the discussion, rather than sweeping through and dropping bad-news rental increase letters in their mailboxes makes you more human, and shows them respect.  Give it a try.

How have you been financing them?  Do you both have solid jobs/ income to do conventional? or have you found another source?  Please share.

You can setup alerts on some of these sites to email you with new listings that match your criteria. I've been working with the same agent for many years, he knows what I like, and still misses them sometimes. I like to bring him things he's missed as a learning opportunity, but realistically speaking, every agent has many clients who are buying, and won't get you every deal, every time. Always be looking for yourself at the MLS. There are also sometimes FSBO on Zillow/ Trulia that won't show on the MLS because they aren't listed there. So many places to look, so little time.

Some investors I know hire a virtual assistant to look through all of the listings in their respective markets looking for deals that match their criteria to save them time looking, but like @Richard Sherman said above, the exercise of looking at deals makes you better at recognizing and taking action on the good ones.  Best of luck!  Things are tight up here in the PNW in these markets.

Jonathan

The Dalles, OR 

I manage 27 units using Google Sheets.  It is like Excel, but it is free and lives in the Cloud.  Maybe others on here are meaning Sheets when they say they use Excel (the word "Excel" tends to be interchangeable with any spreadsheet creation software).  Google makes it easy to use and securely stored on their server.

I keep an individual Google sheet for each of my properties.  I use this spreadsheet: http://www.cashflowdiaries.com/how-to-track-your-m...

It is free, easy to use, and can import easily into Sheets to use it in the cloud.  

I record all of my expenses and incomes for each on the sheet real time as I incur or collect them.  It takes about 15 seconds at the Home Depot checkout line to add the purchase to the respective properties' sheet.  At the end of the year, I give all these docs to my tax preparer and he puts them together for my taxes.  A few minutes a day doing this saves me thousands per year on hiring a bookkeeper for my business.  When I get home, I just toss all my receipts in a shoebox.  Hope to never need them or get audited, but I've got all the records for each year if I ever need them.

Hey Kayla,

Congratulations on your successes.  I have been working with PNWFCU and they do a good job.  They aren't large enough to do big multifamily (like 20+ units), but have been great for a few smaller 1-4 unit properties.

If you find a good one please let me know, I'm always looking for good lenders.  Best of luck!

Commercial VCT is actually very good product, but it is as expensive as good quality laminate flooring.  Its nearly impossible to install yourself, so by the time you hire a pro to do it, its cheaper and easier to just do 12 or 13mm laminate floating floor.

The stick down stuff they offer at HD or Lowes is garbage.  Stay away.

Bought the plans of eBay....  totally brilliant!

I also have been doing a few new construction to rentals. It's a great niche because you won't have much in the way of CapEx for at least 10 years if you build right, and tenants LOVE the new finishes and modern styles. When the market takes a dump, you'll be the one sitting on top with all your rentals occupied! Well done!

9 weeks start to finish is impressive as well!  Great job project managing.  Keep up the good work!