All Forum Posts by: Larry Smet

Hi All,

I've been exploring partnering with a US citizen (I'm Canadian) to purchase small (i.e., "residential") multifamily properties together in Chicago - 2-flats or 3-flats.

Traditionally banks don't want to have anything to do with lending to foreigners like me, but I think having an American in the partnership would make a positive difference.

Does anyone know what effect the partnership would have on getting funding? Or better yet, does anyone have an institution to recommend where they've successfully done something similar?

Thanks,

Larry

Hi @Raji Kaur

A good realtor can really help you out a lot in getting to know an area as well. And obviously essential if you're planning on doing a flip. I agree with @Paul Timmins that getting several PM's opinions is a great way to go - especially for assessing an area for rental properties.

Some people recommend that your rehabs have to be in your backyard, but in my experience (currently working on my 8th flip) that isn't the only way to do it. I live in Toronto, Canada and all my flips have been in Chicago and Orlando.

Having said that, your "backyard" could conceivably be in your old market in Michigan - especially if you have a lot of contacts back there.

Good luck!

Larry

Thanks @John Hauser

I know for larger multi-family properties you can also add a device to the water pipe going to each unit (it's about the size of a pack of cards) which separately meters the water. I think it's several hundred each to install. I haven't heard anyone doing that on small multis though.

Larry

I can sympathize with you @Atul Mohlajee - after they stayed past the court-ordered date of possession (Dec. 5) and we filed with the sheriff, the tenants in the building we purchased were finally thrown out by the sheriff on March 14!!!

The sheriff doesn't do evictions from about mid-December to early January and they don't do them if it's too cold.... so at least you won't have that to deal with

Good luck with your eviction

Larry

Ha ha - we were working on 2 flips 10 minutes east of your building at Irving and Cicero! Thanks for your insights on switching to metered water.

Thanks @Brie Schmidt

This is very useful. We're starting to look for rentals in Chicagoland as well as continuing with our flips on the north side of Chicago. Do you have any experience or thoughts on billing back tenants in Chicago for the water they use?

Cheers

Larry

Traditionally a lender will want to see a debt service coverage ratio of greater than 1.25 - but that's on commercial properties. Does anyone know banks have a DSCR criteria on residential (<5 unit) properties?

Hey @Samson Kay

You were asking about safety - there's a handy resource to assess that by determining the crime in your area of interest in Chicago: you can check it out here - http://crime.chicagotribune.com/

Just put in the address or area that you're interested in. Chicago can be block by block, so don't assume that a whole area is good (or bad) based on reputation alone. A good property manager who specializes in the area that you're interested in would be very helpful.

Let us know if you get the job! :)

Larry

Great work Wendell - thanks for sharing

How many people are on your team (boots on the ground and /or VAs)?

Keep on inspiring!

Larry

PS - Please let me know if you find any good flips in Logan Square, Irving Park, Avondale, Belmont - Cragin, etc. That's where we've done our last 4 flips with 2 more on the go. Thanks

Done

Let me know when you find a good wholesale property for me. :)

Larry