All Forum Posts by: Jeff V.

@Jonathan Taylor Smith We used a local community bank First National Bank of Deridder. Jeff V

@Samuel Garrett I have used 2 local lenders but one had an investor friendly loan officer who knew the business. He was able to help setup a line of credit. Lender is First National Bank of Deridder, it's a local community bank. Jeff V

@Michael Conklin We use a local lender First National Bank of Deridder. Jeff V

@Omid A. 

Looks like there is around 44k worth of equity that you could tap via a HELOC to use on your next deal(s).

($440k * .10 = 44k making combined LTV 80%)

We have been doing this on our BRRRR Deals to continue growing our Line of Credit to allow us to get into bigger deals, flips, private lending, notes ect... for multiple streams of income.

Just another idea.  Hope this helps.

Jeff V

@Aubrey H.

I believe the answer you are looking for depends on your personal goals and what phase you are currently in.

Phases of a RE businesss - Buy a Million(Acquisition), Own a Million (Growth/Optimization), Distribution (Maximize Cash Flow)

If you are still in the Acquisition phase of your business, you should be setting all of those funds aside for acquiring new properties or investments to add to the portfolio.

Keep in mind that the ROI is often better keeping the property leveraged by cash out refinancing and putting those funds to work as well during your growth phase. This way your equity even is giving you a return.

Once your portfolio reaches critical mass, or you hit your target numbers or cash flow you can transition over to paying down debt to prepare for the final distribution phase.

However, people need to retire, or go full time, at some point this is called your distribution phase, so when that time comes be sure the properties are paid off by that time to maximize cash flow in retirement.

A great book on this topic and more is Gary Keller's The Millionaire Real Estate Investor. He goes into great depth on the different phases of your business and where you should be focusing your time and energy at each phase.

Hope this helps.

Jeff V

@Jesse Palmer

I'm still fairly new to the note space, but the notes I've written on Kentucky are the requirements to do business in KY are high...  I'm tracking debt collectors license is required and a million dollar bond.

Again I'm new, but the advice I received from podcasts ect was to avoid KY due to the high requirements.

I know your looking to network with local investors, but with the high requirements in KY you may open your radius up to surrounding states as well.

My exact Notes:

Kentucky

• Million Dollar bond required
• Avoid this state for note investing

Hope this helps.

Jeff V

@Luke Grieshop

First position is the first note and mortgage lein recorded against a property.

Second Position is any subsequent note and mortgage lien recorded against a property that already has a first.

Basically First and Second indicates superiority of the lien and who has first dibs when it comes to foreclosure.  Whoever records the lien first has Senior/First Lien status all other liens are Junior to the First/Senior lien.

There are some Super Liens that jump in line for some states like HOA, Municipality and Tax Liens for example.

Hope this helps.

Jeff V

@Account Closed

I'm no expert in notes so take my advice with a grain of salt, but here's an idea...  *hold my beer!

If your "friend" is willing to buy the note at par, then why don't you give him a note and mortgage in return for paying off your existing mortgage...  similar to a refinance...  He/She may have to use a RMLO to draft this new paper to be dodd frank compliant...  not sure talk to an attorney.

Next, you may be able to do a quit claim deed  or Deed in Lieu over to the lender for your interest in the property.  This should put the lender in the position to foreclose on her interest in the property...  may take some time depending on the state and some capital.

At foreclosure sale, there is a chance that some other bidder can out bid the lender and take the property for themselves...  so there is a good amount of risk in this plan to loose the house entirely.

On the other hand your friend the lender could end up with the property as an REO and then re-deed it back to you. However, your ex will still need to be evicted and may have some choice words when you meet her in eviction court and she realizes what has transpired.

I gotta say this is a crazy plan...  not even sure it would work.  Also, that would be some friend to do all that for you.

Is there not a way to handle this in normal divorce proceedings like force a liquidation of the property and pay her half, or pay her half to keep the property, or have her pay you half and you walk.

Lots of other viable options here....  If nothing more, hope someone has been entertained by my ramblings.

I'm in no way endorsing this plan...  just a mental exercise on how could one accomplish this....  but what do I know :P

Jeff V

@Amanda G.

The short answer is you will need to have a lawyer draft that up.  One with experience in putting deals like this together.

The way we have done it in the past is have the lawyer draft up the docs, have all partners review and if anyone has any objections for their situation, they can bring up that scenario and edit the draft to compensate for that scenario.  Once all parties are satisfied sign the final draft making it official.   There will typically be a round of questions during the process like what if your partner gets hit by a bus, what happens to their ownership?  If their spouse gets ownership will they have full management rights or will their rights be limited? ect ect...

The docs are usually part of the operating agreement, if not on the actual operating agreement itself within the LLC.

Again, you will need to consult an attorney to have this drafted.  I wouldn't shoot from the hip on something as important as buyout agreement or death of a partner.  

Hope this helps.

Jeff V

Looks like your purchasing a Distressed Property for Retail price and then renovating... 

ARV of $115k with a total project cost of $150k....??? Unless I'm missing something you should be buying this at a discount of 30% minimum - repairs (For a Flip)... Purchase should be ballpark of 50k provided your ARV and renovation projections are accurate. For a rental I like to be around 60% ARV to boost cash flow which brings purchase price to around $40k.

Not trying to beat you up over the analysis, but that's something you don't want to be that far off on. Also rent is typically 1% of the ARV which would put the rent in the $1000 - 1100 range. This is different for each area so look at some rental comps to see what yours is for your area.

Hope this helps.

Jeff V