All Forum Posts by: Jeff V.

@Kenneth LaVoie

Why not figure what your payments would be with the 30 yr financing and then work backwards to figure what your LTV would have to be with your current financing and then use that as a target point to pay down to and then refinance...

This way you keep your liability protection, get the same payments as the 30 yr financing and are better protected against a down turn of the market due to the larger equity cushion.

Example 100k note with 30 yr 4% = $477.42, but you could use a 20 yr note at 6% in the LLC and carry $66,638 mortgage to get that same payment $477.42. You would have to pay down $33,362 to do that, but you could just pay it down over time or just make a mental note of what point you need to refinance once it gets to that level.

Just an idea, it may take more time to get positioned for this method, but it will be the best of both worlds...  liability protection and lower payments.

You could also access the equity cushion in each property after doing this with a HELOC to use for private lending, note purchases, acquiring more deals ect.

Jeff V

@Paden Anderson

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

Since 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 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.

If you have the ability to get 30 yr mortgage, then thats the correct approach for your phase.  It allows you to cash flow more monthly which in turns allows you to save up for the next deal quicker and growing your portfolio faster...  which is the goal of the acquisition phase.

Jeff V

Charles,

Where will you be stationed?  I'm in the Ft. Polk area, feel free to reach out if this is where your headed.

Jeff V

Joe,

I work full time as a Network Engineer, so 7a - 3p M-F is reserved for my job.  However, I'm able to monitor my personal email and respond to anything that comes up in the RE business that don't require me to be there physically.  

In my downtime on lunch or breaks I check the MLS an any alerts that I setup for new deals. I flag those new deals for analysis and upload them into trello. After running numbers and getting a ball park max offer price, I can then schedule to see the property after work. After reviewing the property I decide whether my initial estimates are valid or need adjusting and then put in an offer if I want to proceed. Once under contract, I validate all of my assumptions by getting an inspection, quotes, CMA ect to be sure everything is on point.

When I have spare time and no deals to analyze or view, I keep up on latest market trends and strategies by reading up on BP and other blogs as well as latest building products or researching whatever current issue I'm facing in my business.

I try to think ahead and get prepared for the next phase of my business.  I believe being poised and ready to pounce on the next opportunity is just as important as being able to recognize the opportunity.  You have to be able to both recognize the opportunity and have the capacity and education to be able to execute on the opportunity.  Opportunity comes to everyone, but if your standing on the tracks, you could very well be ran over if your not ready for it.

Every day, I try to learn something new that I can use to help make better decisions in the business or get me ready for that next phase before it comes.

Jeff V

@Samuel White

You may be able to access around 80k of that equity with a HELOC, if your parents will sign for you to allow the property to be used as collateral. Then you could use the HELOC and your capital as a down payment for the duplex/triplex.

Just an idea, hope this helps.

Jeff V

Sounds like you have a few exit strategies.  Chances are slim that you will get a workout on this being they are so close to foreclosure.  Same for DIL... doubt you will be able to get that only being a couple weeks away...  (It is taking 3 weeks just to get our recent note purchase transferred to our servicer, and another month of waiting after before we can even begin outreach)

Foreclosure will most likely be the case which will result in a couple possible scenarios.

1 MHP is purchased by another bidder at foreclosure auction.  In which case you need to run the numbers to see what you could collect at the sale and work backwards to get to your desired return when putting in an offer.

2 MHP doesn't hit your reserve which will then become an REO. Run the numbers according to this scenario. Most likely you will have to estimate expenses ect being you won't have access to the borrower to get this information up front.

Bid based on worst case scenario of the 2, or most probable outcome....  Worst case scenario bid is probably the best way to go and least risky.

I'm still new to the note space, so just throwing some ideas out.

Hope this helps.

Jeff V

Thanks for the responses everyone!

Looking forward to a long business relationship with Bob Green.

Jeff V

Thanks for the response @Marques J., @Stuart Weihler and @Bob Green.

Bob cleared everything up for us and we're rolling forward.

Thanks for the input everyone.

Jeff V

@Amine E.

This is my first time hearing abou this "Guidance Line" what is the difference between this line an an Equity Line on equity in rental properties?

Do you refinance the properties to free up your Line or do you just leave the debt on the line and pay down over time?

Jeff V

Hello Fellow BP Members,

Recently I ran across a lending Group called Rental Property Lending Group on BP which has some loan products that seem attractive that will be able to use to grow the business faster.  It's ran by Bob Green, he has lots of connections here on BP and seems on the up and up.

However, my spidey sense has been going off despite during our communication he has been very helpful and answered all of my questions quickly and seems knowledgeable.  

What has set off my spidey sense?  The more I dig the more I find inconsistencies...

• His profile checks out on other social media but LinkedIn has him with only 20 connections. (Justifiable if its a new profile)
• His website has a link to a Bangladesh web design company. (Justifiable for a low cost web presence)
• Logo and name on website is RPLG, but the title of the page says THG Capital Fund. (Justifiable, had a post recently that says RPLG merged with THG)
• The Application he sent over has Finance of America Commercial LLC on the letterhead. (Not sure why the different company on letterhead... strange)
• Illinois secretary of state has both Rental Property Lending Group INC and Rental Property Lending Group of America INC and they both are DISSOLVED, one being DISSOLVED INVOLUNTARY (Possibly, restructured into a new name during the merger forming entity in different state?  Not sure)
• Finance of America LLC is in good standing, but owned by a Delaware LLC Buy to Rent Finance Manager. (Dead End, DE doesn't disclose officers/members)

I asked Bob Green for references and he said he has references, but did not provide any.

So my question for BP is, Has anyone here done business with RPLG, THG Capital Fund and/or Bob Green before and can you set my mind at ease?  I believe RPLG to be on the up and up, but would like to hear from others that have done business with them and or Bob Green.

If Bob runs across this post:  Not my intention to offend in any way, just doing my due diligence.  Hope everything checks out I would very much like to do business if everything is on the up and up.

Jeff V