All Forum Posts by: Joseph Belgrad

Thank you guys, no, there's no specific additional protection I'm looking for. I just don't want him to run away with the financing, that's all. Not looking to do anything crazy.

I currently have a deal happening in the works in partnership with a wholesaler. He's found a great deal in which we can get a duplex for 310 and flip it to a buyer already lined up for 365. The trouble is he has no financing. I happen to have access to enough cash to make the deal happen. Therefore, we have chosen to partner for a 50/50 split of the profits by him bringing the deal and making it happen and me bringing the financing.

I spoke with a lawyer about drawing up such an agreement between the two of us, and he said that he could create such an agreement for $5000-$7500 which did not include the two $1000 LLC creations he felt were necessary. My question is does $7000-$9500 to make this partnership agreement seem like a reasonable price or am I being gouged somewhere? This is in Massachusetts.

I'm currently buying a property (3 family) with 210,000 cash using the BRRRR method, rahab budget 50, ARV over 300. I know I'd be leaving some money in the deal, but this is my first investment property, and if those numbers work out then it'll be a win for me, and I'll at least be able to move on to the next property after refinancing.

My question is: Should I put this property in an LLC upon purchase?

I'm not worried about the liability issues right now because I don't really have any other assets, and I plan on using umbrella insurance. However, I do plan on buying 2-4 properties a year and will eventually want to use LLC(s) for liability protection.

My main concern is logistics of the cash out refinance. Without refinancing I'm stuck at one, maybe two, properties in my BRRRR process. My understanding is that getting a conventional mortgage with an LLC is highly unlikely. I suppose commercial is a possibility, but I would really like to take advantage of the 30 year mortgage with lower interest rates. Even if I don't immediately put this property in an LLC, I would want to eventually for the liability purpose. If I did leave it out of LLC, refinanced into a conventional mortgage, then moved it into an LLC, my understanding is that a lender would likely call the loan due at sale.

What are peoples' thought/recommendations?

This is in Worcester, MA 

I'm currently trying to figure out a max budget for a BRRRR project. This would be my first property. I have partnered with my mom on this project, and she has given me access to a 600k line of credit at 2.5% interest.

My market is Worcester, MA, and I want to find a triplex (they're pretty much all three story) in need of renovations and bring up the value such that my total amount input including purchase price, renovations, and closing costs are <= 80% of the ARV so I can refinance into a 30 year mortgage once rented.

Current triplex prices are running in the high 200s/low 300s that could use some moderate work all the way up to 500s for high end turnkey properties. However, I have seen properties sell for high 100s/low to mid 200s over the past six months that would fit my criteria. 

One of the major issues is that the vast majority of properties were built between 1890-1920, and those requiring renovations often come with plumbing, wiring, deleading, and general updating all around. 

Assuming I could find a property in the high 100s/low to mid 200s given the right circumstances, what should I set as my max budget if I would like the quality of renovations to be "rental plus"? 

Thank you for any and all input or suggestions as to better ways to run the numbers or approach the project.

When doing several BRRRR properties over the course of a couple years, that would take multiple credit checks to be approved for loans and refinancing. Given that credit scores take a hit for a year every time the credit report is pulled, how do we manage applying for credit multiple times per year while still keeping our score high enough for competitive rates?

For those of us looking to build real estate portfolios quickly, I imagine we would find ourselves applying for a lot of loans over the course of just a few years and would then have our credit report pulled many times. For example, if I want to purchase 4 properties a year using loans such as conventional, FHA, 203k, hard money, etc. then I would have my credit pulled 4 times. In two years that would be pulled 8 times. If I want to use one loan at the onset and then refinance after 6 months or a year then that's two loans per property or 16 loans in two years. Now having my credit pulled once or twice every couple years doesn't really impact my credit, but once I start having many credit checks over the course of just a couple years, my score (and thus my financing (with traditional lenders) eligibility) would take a hit. So my questions are:

1. If I get a loan or multiple loans and then refinance with the same lender, would they still pull my credit for the additional loans and the refinances or would my history with them be sufficient?

2. What are people's suggestions for working around this issue? Of course I could go to private money lenders and partnerships, but I'm curious if anyone has any work-arounds for this issue while still using traditional lenders.

Thank you, guys! This is really helpful!

Hello, really new to BiggerPockets so if this topic has been discussed already then my mistake. Why use a hard money lender over a 203(k) loan when purchasing a fixer-upper? If the hard money lender lends at 12% interest and the 203(k) lends at 5% interest, it seems to make more sense to use the 203(k) initially and then refinance into a conventional loan in the same manner as you would if using a hard money lender. The only downside I can see to this is that you would have to live on site until the refinance due to the requirements of the 203(k) loan.