All Forum Posts by: John Hill

Scott Snow I'd definitely be willing to work with you. I currently have 4 SFR that I rent in SLC plus a 10plex ready to close next week. I would be willing to share my insight, knowledge and strategy for a little insight into the commercial and SBA world. My wife is a real estate agent and I'm currently on my 15th year in the military. If you have time to meet at a local beans and brews I'd be available.

I moved from Maryland to Utah about 17 years ago. When I arrived it happened to be to Ogden. At first I thought, oh no I drank to much on the airplane and missed my stop in Utah, I must be in Tiajuana. It was full of gangs and believe it or not, Ogden had a mall at the time (that mall has since been demolished because of its attraction for gang members). I believe

@William Hochstedler may be right if you have a high propensity for risk and  are willing to hold out for the revitalization (which he is correct has been "coming" for 50+ years). I believe front runner is definitely a positive for the area and allows commuting to slc and Utah county to be economical advantageous. My advice would be to first time buy and hold as well as flippers to maybe concentrate on areas like Roy or Sunset which may be priced comparatively but draw a different demographic.  Let's face it, I believe that the lower class of Ogden will be driven out when the city holds the residents of the community responsible for there decisions and life choices. If you have 20 tickets for not keeping weeds abated then maybe jail time will help you realize your responsibility and civic duty. Same with loitering on corners throwing up gang signs and parking your automobiles on the front lawn. An investor can buy a house in the hood for 50k and dump 25k into it to make it habitable and possibly draw the prospective client that will appreciate and respect it but don't thing for a minute you won't be affected by the unlawful citizens of the neighborhood. Your perfect client will soon realize they don't appreciate the late night parties, police sirens, gang activities of the neighbors, oh and let's not forget the frequent street wondering of toddlers who were exploring the city at 1am because mom and dad (actually dad is usually out of the picture) are gang bangin or strung out on meth and Coke. These types of people will undoubtedly affect your investment. 

I believe Ogden even areas above Harrison (did a ride along with a cop and was shown the gang taggin even in those neighborhoods) is a risk that should be completely recognized, appreciated but also understood for what it is. 

Joe T. Big banks are absolutely horrible when it comes to funding anything other than a Primary residence. I say this because I've had this same thing happen to me. What Chris M. Is telling you is "spot on." I will tell you that if your agent recommended a broker or a preferred lender that was prob the only thing you could have done differently. My wife being an agent has preferred lenders and both her and her lenders are skilled and oversee every deal daily. Neither the agent or lender benefit from a last minute deal dying. Recommend finding a broker, you will pay more but they are commission base, charge more than banks but almost always get the deal done or tell you up front it won't work. They are commission based and don't wanna work for free on a deal that is a waste of there time. In the future if wanna use a big box bank to close a deal, I recommend throwing it to multiple banks therefore ensuring a greater chance of closing. If your agent did not recommend a preferred lender and did not track this loan I would probably not use him/her again either... In this business it's crucial to an wing a good team of experts in your corner..

I'd do it and not think twice! I'm assuming you know the demographics of the area and what type of clients would rent the units. If you feel comfortable with that. Other than that sounds like a good deal. What are the costs to you every month? Are the gas, water and electric separate and the responsibility of the tenants?

@David Dachtera I've figured the zoning out and can get it approved. I just don't know SBA well enough to know if they would fund a project like this. 

Thank you for your reply though. Do you have any input on the funding?

John

BP, Does anyone have any experience or knowledge of SBA 504? Specifically, I would like to use this to build a home office (a stand alone building) on the property of our current home. Would SBA loan to us to fund this project? John

@Ashton Noland what @Kerry Baird is saying is this is a very complex strategy and for the most experienced investor. The main point is you need capital which you stated you do not have. Instead of going "all in" on this deal where your reputation is on the line and the borrowers credit is at stake, move on to your own buy and hold deal... 

Sounds good so far but why is only 1 of the units currently being rented?

That's a lot of water. I would definitely be over there checking things out.check basement and crawl spaces. After that then report back. If it did come from the toilet you will see a visible sign, 3000 gallons of it.

@Jason V. I'm buying my third rental that happens to be a 10 plex and so I'm beginning to familiarize myself with the commercial loan process. My opinion is that you can what-if these scenarios all day long. My advice to you is if you have a good deal than concentrate first on funding and then possession. Once you have it recorded then sort out your legal strategy. Hell, if you have time during your due diligence period then consult another attorney and have him memorialize a strategy for you that your comfortable with. You can always slap that down if you get sued. I would recommend a larger firm, for obvious reasons. Anyhow, your fine in the meantime with an appropriate level of ins. In the end, you can use threat of lawsuit to completely paralyze you from investing all together. The right team (legal, title, handyman, real estate agent, etc....) will be your path to success. 

I think the zoning of the property will be a bumpy ride so just be prepared to obtain financing residential or commercial. Maybe use a lender that can do both. 

I know people will contradict this all day but claiming an LLC on title is not going to be that big of a deal, as long as your making payments. If it was an industry wide problem you'd have no one doing seller financing! Again the bank can call the loan due for that but it doesn't happen. Pay on time and you'll be fine!

Good luck brother!