All Forum Posts by: Ken Naim

@David Babayev with existing long term NNN leases value add is hard and returns are usually low, think cvs, Starbucks etc.. So big gains are unlikely. If you buy something and then add value including signing a new NNN lease with a long duration of 10+ years it can be a home run.

@Bennet Sebastian Hey Bennet, my wife is recovering slowly. Thank you for asking. Im ok recovering from a nasty non-covid cold. I should be around for the next mastermind. Good luck with this project.

@William Walker multi family is very competitive, for the right borrower even 15% is possible although unusual. 20-25% should be expected. Some more conservative banks might be higher on down payment but will give very low rates yes dscr, dti, credit score, personal and business income/balance sheet all play a role.

@William Walker assuming that the 6 sfh are on different lots/deeds which they likely are you can handle the purchase 2 ways as a unit with all 6 being collateral on a single commercial loan. Other option is 6 contracts to buy each one individually. Each is its own mortgage and collateral. The overall price and downpayment needs to be broken down appropriately so each has sufficient equity as collateral. Usually there is a clause in each contract stating that the sale is contingent on a simultaneous close with the other parcels. First option is easier and cheaper from a closing cost point of view. Second opinion makes it easier to sell individual units later.

There is a third option but that usually reserved for much larger portfolios where you buy the llc including any existing mortgages. This has significant risks but at the portfolio sizes they are used are use in, the risk is factored into contract and price.

@Bennet Sebastian might need to change the structure of the deal so each investor is under 20%. Either have additional inestors or get the smaller one to increase thier contribution or maybe the larger one can contribute via 2 different entities (trust, ira, llc, personal name) so on paper each one is under 20%. Work out a deal with this limited partner to contribute the extra post closing. Just be creative.

@Evangelos Mavros in todays market the best town is where you find the best deal that meets your criteria. Property type, class, turnkey or rehab, cashflow or appreciation, ltr or str, single or multi family, price, passive or active, self managed or not, loan type etc. I personally prefer palm beach county but my criteria is likely different than yours.

Could you get the current owner to hold the note for 12-24 months until you finish the rehab. That lowers the amount you need to borrow overall. Also go to several local real estate meetups, there is always someone with cash/credit/experience looking for a deal. Bring an executive summary of the deal including costs, comps, repairs etc. If you can't finance the deal at the very end, try to wholesale it to an investor, some profit is better than none. Maybe wholesale one and use the funds to do the other.

What kind of insurance (assuming real estate), residential or commercial? relatively new construction or older property. For newer construction, residential I recommend the Tom Neuman agency (Allstate). Allstate has started insuring these types of homes and may be competitive, plus they can quote most of the insurers in the area. I also like Erika Hyte at Brightway insurance, very helpful and prompt. If you need commercial insurance, let me know.

LLC laws vary state to state but generally need to be in state of the business activity or where you live. If they are not in the state of business activity then it again generally needs to be registered with the state of the business activity otherwise it doesn't exist for lawsuots in that state which defeats much of the purpose of having one.

You can have nested LLCs depending on your needs but that is generally used for high equity transactions, say $1m or more.

@Jim Miller LLC laws vary state to state but generally need to be in state of the business activity or where you live. If they are not in the state of business activity then it again generally needs to be registered with the state of the business activity otherwise it doesn't exist for lawsuots in that state which defeats much of the purpose of having one.

You can have nested LLCs depending on your needs but that is generally used for high equity transactions, say $1m or more.