All Forum Posts by: Jonathan Makovsky

We are hoping to close a small commercial loan ~ $400K with limited [equity] partners in the deal. A number of banks we spoke with want all members with more than 25% interest in the property to hold PG's (Personally Guarantees). Our LP's would not be interested in this structure, is there a way around this?

A few options we thought of:

• 1) Create a separate investment LLC that we are managing members of. (One bank said this would work, another one said it would not.)
• 2) [NOT IDEAL] Have investors use different names (for example, wife, husband, kids, etc.) so that they do not own a 25%+ share.

Thanks in advance for feedback.

@Doug W.

Really appreciate the very inspiring and sincere post. It sounds like this was an amazing learning experience, and for that I believe you deserve a big congrats (despite the net 0 result).

Hopefully this was the perfect stepping-stool you need to kick butt on all of your future deals. You sound very methodical and I can't wait to hear about your many successes in the future!

There are two books that I found to give me the foundation in two different fields:

1) For flipping houses I cannot recommend enough: "The Book on Flipping Houses" by J Scott.

2) For understanding the basic economics of real estate, and specifically for buy-and-holds: "What Every Real Estate Investor Needs to Know About Cash Flow..." by Frank Gallinelli.

 @Jered Sturm

Nice job attaching the GoPro to the house.

@Jered Sturm

 that video is awesome. I watched it a few times!

Congrats @Account Closed

Welcome @Jennifer Chevez

You have a great attitude and are in the right place to learn - it sounds like you'll do very well. Just echoing some of the advice above, be careful spending money on education - when you can learn most (if not all) of that on BiggerPockets. I didn't know the first thing about wholesaling and rehabbing before BP, and learned everything I needed to know from them and some books.

I think your idea of finding someone to work along side is great, and if you're going to spend money let it be on a property or marketing.

Best of luck in whatever direction you move forward with! Looking forward to hearing about your successes.

@Diante Lawrence

 Welcome and great to have you! 

IMO, be careful to fall into being a wholesaler just because you don't have the funds for other types of investing. If you're a hard worker you might be able to work with an experienced investor in your area in exchange for knowledge and a small piece of a deal. In that case, You might be able to learn more by having hands-on experience and maybe you'll even make more money that way then wholesaling. 

I'm not discouraging you not to do wholesaling, but don't do it just because of lack of funds because chances are you will need to market your properties or spend A LOT of time finding "free/low-cost" ways to wholesale, and if you do that you might be able to use that time instead to work in real estate and make money while supporting other investing channels.

Best of luck and looking forward to learning about your successes!

@Account Closed

 I think it's tough to pin down an exact answer since many sellers seem to have different motivation to sell without a broker. 

We bought one where the estate taxes needed to be paid off immediately, so they opted for cash. Another, where the tenant had not paid rent for nearly 2 years and the seller just wanted out. Other sellers have mortgages, medical [and other] bills that they are behind and nee to be paid off immediately. 

I think others just don't want to go through the headache. 

I tend to think of us as offering a white glove service. Don't bother getting the house in shape, leave whatever you don't want to take, no showings and other headaches, just take your check, your toothbrush, and other valuable possessions with you, and we'll handle the rest.

Hi  Michael, I think it's hard to know if it's a good deal without knowing more about your assumptions you used, the property, and the specific area of the property. 

For example are your input metrics correct (expenses, forecasted vacancies/repairs/capital expenditures, etc.)? What is the condition/age of the property? Is the house in a very desirable/strong location, or is it in a really tough area? 

I think local investors and property managers might be a good way to find answers to some of these questions.

Hope this helps, and best of luck with whatever option you choose!