All Forum Posts by: Kevin Wong

I have a potential multifamily deal in Los Angeles with the seller willing to finance. High level, I understand how the seller financing works, but dont know the granular stuff of how to get it into an agreement and serviced. Are there specific title companies locally more familiar with seller financing? And who does the loan servicing and collect the payments?  Anyone who has done this in Los Angeles I'd appreciate any tips.

you're getting killed on PMI, probably because of your low downpayment. Still looks awfully high.

They are also taking out a full year of property taxes and you have high transfer taxes, which Im not sure is typical for your county.

Hey Aaron, I'd be interested in some references for wholesale priced GC's that could do a good job in LA if you have any. I recently completed a garage conversion ADU that was about 400SF and cost me about $80k for the construction - not including soft costs. The GC was slow and painful to deal with, so I'm looking for better ones on some future projects.

I also think with the legalization in California there is a opportunity to capitalize on the real estate side of the business, but you'll definitely need to have plenty of cash since financing will be challenging. As a commercial mortgage banker, any real estate with MJ business attached to it is an automatic reject for most banks. I know just 1 small regional bank that is willing to do the commercial loans for MJ industry, but they charge a premium with starting rate over 6%. So there is even more risk if you're leveraged on the property and the business is shut down federally for some reason, you may be stuck debt servicing without the property income. 

@Matt Roth I have some value-add retail investors that have been and continue to be very successful in turning around poorly managed retail centers and anchors which have gone dark. The location and demographics will be critically important, but in their successes it seems like a repositioned center will have as an anchor one of the following: major gym, movie theater, discount apparel store (TJ Maxx, Ross, DD's Discount), hobby store, general discount store (99c Store, Dollar General). There should also be a good mix of fast casual restaurants which we see many new concepts being successful over the traditional burger / fast food chains such as personal pizza and poke bowls. A mix of the above and local businesses should be a strong value to a suburban neighborhood. 

@John Wanberg, rates & leverage on multi-family is generally better than commercial property. With most lenders rates have already adjusted and 5Y Fixed rate will be 4%+ with your loan amount. Chase updates rates daily whereas some other lenders update their pricing weekly or monthly. You might check with Luther Burbank if you have one locally. I get high proceeds with them usually and they accept our underwriting, not tax returns. Otherwise I'd check with local credit unions who may update rates on a moving monthly average. Ultimately the appraisal will be what the underwriters determine your property value by. 

Hi Tyler, I can help you with your financing needs. I'm a local commercial mortgage banker in Los Angeles and I know the South Bay area.

Any lender is going to do a cash flow analysis and determine if you will be able to debt service the additional loan payments through your current income. If you are behind on tax payments already  and have accumulating debt, it's unlikely your cash flow is going to look good.

You may have a better chance with private lenders, but you're going to be paying more interest and a higher monthly payment. If your cash flow doesn't support the total debt payments, you're going to end up pulling more equity to maintain debt service which any lender will be concerned with.

Get the last 2 years of income and expenses to see what the NOI on the property has been. See if there is any deferred maintenance on the property and estimate the costs of repairs.

I've also been thinking the same idea. Instead of mobile home communities, is there a way to develop a Tiny Home community? 

I think a nice "high end" tiny home community for millennials in Los Angeles would be a killer idea. Affordable housing without being "affordable housing" and become real starter homes while forming different living communities.