All Forum Posts by: Joshua Hollandsworth

@Daniel Pichardo Without more specific numbers, I don't think anybody can give you a good answer. Here is how I quickly analyze a deal. Gross Rent - 30%. Then subtract PITI and Utilities. Only you can decide if it is a good deal. How much is the purchase price? Are you capturing immediate equity (are you paying less than the property is worth?) WHY are you investing? Cash Flow? Appreciation? Tax Benefits? How hard will it be to sell the property If you decide to do so? I will not personally purchase any property unless I Cash Flow at least $200 per door. I shoot for $600-$800 cash flow on a duplex.

To legally rent out your condo, you would need a Tax I.D. number. Contact your State for this. Your city may also require that you pay rental registration fees.

@Kyle Jenkins If you financed the condo through a national lender, you usually HAVE to keep the mortgage under your name, and are not allowed to have the mortgage under an LLC. An LLC limits your liabilities if someone were to slip, fall, etc. An LLC would protect your personal assets. In other words, if you were to be sued, only your LLC's assets would be obtainable. There are other benefits as well. From my experience, most lenders will not allow you to do this.

Is the Clark-Fulton neighborhood a bad area to invest in? I personally would not want to drive around this neighborhood knocking on doors for rent. I also wouldn't want to drive through Clark-Fulton at night to replace a broken light fixture. Clark-Fulton seems to be a very profitable market. I know that I could hire a PM so that I never have to deal with tenants personally. I would like honest answers. Part of me says "Josh this is a very dangerous neighborhood, and you know it." But, the other part of me says "Josh, why do you care if it's a bad neighborhood? Hire a PM company so you don't have to deal with residents personally. It's no different than investing out-of-state." I am willing to put my money into these cash flowing duplexes, all day long. I just don't want to continuously travel here. I really do want to get over my fear of investing in bad areas. I have a feeling I am missing out on a lot of cash flow. Thanks in advance!

@Mark Mueller @Cara Lonsdale Thank you guys for the helpful information. I don't want to borrow against any of my current rental properties. I want to purchase a new house, say, ARV Is 50k. No repairs, to keep things simple. If I get a 10% equity capture, and put 25% down, I will have 35% equity. I understand that I can only get 60%-80% of that equity, I just want to purchase house A, then possibly purchase house B, using 80% of the equity from House A. It would just speed things up a little bit.

Talk to me like I'm 5. When purchasing a new rental property, can I pull A HELOC to put a down payment on another rental property? What are the Pros/Cons/Challenges I will face? Thanks!

I really want to start building a relationship with a portfolio lender. I am almost certain that the only option here is to contact a mortgage broker. I have had a difficult time finding one on my own. All of the small banks I have called are selling their loans, and my realtor(s) haven't been able to provide any referrals. What are my best options here? I have read other forums relating to this topic, but I want something a bit more in depth. Local Investors seem to be somewhat secretive about portfolio lenders. I have really reached out to everybody on my team, and we haven't been able to find a solid source. My short-term goal is to own 10 rentals by the age of 25, and I won't be able to due this through big banks. I know I CAN have up to 10, but it seems as though no lenders are willing to do lend on 5+ mortgages. Thanks in advance

Generally, 35k is the absolute minimum. In some cases, 32k. 25k isn't going to fly. I would personally use a HELOC, if you're able to do so.

I meant HELOC*** Not refinance. Borrow against the equity to pay back the investor.

For the first time, I have found an investor willing to help fund my next deal. I am so excited! However, I have no idea how to properly borrow these funds, and I want it to work out great for both parties. Here is how I think the deal would work best- I borrow 15k to purchase a 50k duplex using a conventional mortgage (30 year fixed). I then refinance the property quickly to give the investor 75% of his initial investment. Then, I either repay this investor for the remaining 25% PLUS interest for the original loan amount. Or, I refinance, give him his 75% and give him a portion of monthly earnings. I have not a clue how to legally borrow funds for this deal and protect both parties. I want to get most of the borrowed funds back to the investor immediately. Real Estate has been very rewarding thus far. Any advice, or criticism would be appreciated. Thanks!