All Forum Posts by: Jared Kott

maybe we can package up. Will call you next week to discuss.

Jared - 8609138304

that makes good sense we buy distressed properties around the 30k range and rehab cost typically around the same. Do you lend in Chicago area? Cashouts buildings are leased and rehabbed?

Great topic guys! My understanding is lenders will offer purchase cost plus rehab cost but no appreciation during first 12 months typically.

J - it's really all about the seasoning requirement, most said we can offer 65% acquisition + rehab then they have all said, oh you have only been in business 9 months. LOL I have clearly told each of them this. I have even done presentations clearly stated in our time line. Its not like I am cold calling I see them at RE clubs, city meetings, lunches, functions. They all love the model, but the seasoning crushes the deal. If we go the hard money route we can continue, season, and build but I am nervous that we may get the same message again, at which time we could package and sell but the cash flow is something I don't want to give up. The other side is high juice for a year where we can still cash flow, now as I write this its just greed. Plus I have never used a bank so it gets me skittish.

Awesome, keep me posted.

Thanks John, I am down in the pocket almost everyday if not downtown marketing, feel free to contact me anytime if you would like to circle the area, plenty of deals to be had just nee to be hands on and smart.

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Thanks Derek - we don't a problem with rejection just nervous about smashing our credit each bank said "I think we can" hard pulled us and backed out. These properties need to be bought cash - not financeable in condition we buy.

Thanks for the reply John, we are in South Chicago, 60617, East as you can get. We would really like to continue but without a proper exit it's getting tough. We would like push on and let these "season" for what the banks what to see which is 2 years taxes and or 12 month hold to get a 75% LTV. Would you risk the hard money and believe the banks that they will change there tune after the seasoning period or just move on?

All,

Little bit of a rant, sharing of experience, and seeking advice. I left corporate America last year in Feb. was tried of the 9-5 grind. Jumped into RE full steam ahead. Worked for a guy for free learned some things after 4 months I bought my first "resort" property. Actually that's my own inside term I use jokingly. I have a partner that brings "credit" "stable income" and balance in terms of strength and weaknesses to the table. We used liquid cash, Heloc, and raised ...private capital to get the engine rolling. We only buy and hold right now in South Chicago in tougher neighborhoods and we have created success in a short period of time, 7 buildings, 16 units, 9 months, all free and clear with returns averaging over 30% NET. We acquire through demolition court, wholesalers, alderman referrals, and other city programs. We are really gaining traction, here comes the issue. Our exit strategy was to refi out with local banks we had 4 lined up but all now are saying " great work but "too green" "not seasoned enough" " come back later" "you suck" blah blah blah. The goal was to refi / cash out / build up into the MF 6-10 units range and continue. Because of the pocket we are working it is difficult to find JVP. We have access to hard money at 15% which we are actually considering using because the returns are so solid, and we can continue to build. Using the same exit in 12 months with the cashout refi - but now we are skittish because if we hear the same story in 12 months from banks or credit unions we are stuck with a high double digit loan. Other option is to package up about 35-50 units and start over in different location slaughtering the golden goose laying the cash flow eggs. As I write this is am sitting in my office in South Chicago with my door open it's not as bad as the media paints it but I will be shutting the door in a few hours and locking up. What would other members do in our shoes?????

BP Nation:

Looking for a smaller time accountant to help get the basic fundamentals of my first LLC in order. I am located in downtown Chicago, IL. The LLC is established, first property is to close within days. How did you all find your accountants? How many did you interview? What were the top 5 questions you asked? Whats a typical fee associated with the service? Thanks to all.