All Forum Posts by: Keith Anderson

Any update on this @Jim Tiernan?

@William Hochstedler

Thanks! That was the last piece of the puzzle.

@Larry Fried @Clay Manship

Thanks to both of you for your input. I definitely expect to pay for the turnkey service, but this is all very helpful context as it relates to the financing specifically.

@Kevin Trumbull

I'm definitely using my own conservative assumptions. I had already moved on from considering this specific property, but I am trying to use it as context as I get deeper into the process.

I don't think it's "shady," just a specific business model that may or may not make sense for me.

I asked the turnkey operator about their rationale for the higher down payment, and they confirmed it's because many of their buyers want higher cash flow. (I'm assuming their typical investor is later in their careers and not looking for as much leverage as I am.)

But the 2nd comment gives me pause:

• "Also, with appraisers covering their behinds, sometimes the property doesn't appraise within the ARV's we use."

Thoughts? 

I'm interpreting it to mean they're OK with financing, but don't be surprised if the property doesn't appraise? In that case, is the only option to pay more out of pocket if you still want to purchase the property?

@Upen Patel

Thanks for all the feedback. 

Just to clarify a few things for anyone following this thread:

• The seller has not insisted that I work with any particular lender. I asked for referrals and they sent one. I just asked for more and they sent another.
• The seller referenced 35-40% down, not the lender.

Any thoughts on how to evaluate lenders against one another? Is it all just a function of loan origination fees & rates? How much do I share before I can get that kind of detail from them? (I.e., pre-qual, full application, etc?)

@Account Closed I reacted the same way to the suggestion of putting more down. Just felt like a way to create the perception of better monthly cash flow.

I PMed you for the lender's info. Thanks!

Keith

Thanks for the input @Marco Santarelli.

The turnkey operator is very well known with a sterling reputation. The lender is not. I can't find anything on the lender.

The TK operator also hasn't insisted I use this one lender, they just haven't suggested a few.

The turnkey was the one to mention the 30-35% down payment, not the lender.

We're headed down the path to purchasing our first rental property via a well-known turnkey provider. They've recommended a lender to us, and we're at the pre-qualification stage.

We're likely to buy 2 properties this year, each in the $90k-$150k range. We had planned to put 25% down on each, but the turnkey operator is suggesting 35-40% is more common.

I've been looking for guides to financing rental property and not finding much. Does anyone have any reference material I've somehow missed? 

Here are some specific questions we have:

• How do you evaluate a lender? There are no mentions of this company on Google or BP, which surprises me a bit given the scale of this turnkey provider and their referral.
• How important is it to shop around for a loan on a property like this? If it's important, how can we find a few other solid lenders that are familiar with
• Should we try to time pre-quals or loan applications within a tight window to minimize hard pulls looking sketchy on our credit report? I'm wary of proceeding with this first lender ASAP without having others lined up to compare them to.
• My wife & I each hope to eventually have 10 loans in our personal names as part of our long-term portfolio strategy. Should I leave her out of this loan application process or is it OK to list her as a co-borrower?

Appreciate any insight or guidance. Sorry if these are obvious; we actually rent, so this is our first mortgage.

@Chad there are a few podcasts related to turnkeys at this point:

Passive Real Estate Investing (with @Marco Santarelli)

https://itunes.apple.com/us/podcast/passive-real-estate-investing/id1006557991?mt=2

Turnkey Reviews (with @Brie Schmidt)

I can't find this one on iTunes. It's a great podcast but a bit of a pain to have to listen to it in your browser.

http://turnkey-reviews.com/turnkey-investing-podcast/

Turnkey Real Estate Investing with Matt Theriault

https://itunes.apple.com/us/podcast/turnkey-real-estate-investing/id955254558?mt=2