All Forum Posts by: Lumi Ispas

@Tony Serrano, Are you looking to buy as an owner-occupant or an investor? You could take advantage of a 203K FHA Renovation loan as long as you commit to living in the property for a year and raise the value by 25% after you do the work with the bank's funds. After that refinance into a conventional, and you just did a BRRRR strategy with 3.5% down. I know someone in your area that does only these types of deals and I can connect you with him if you want to PM me privately.

Hi @Joseph Pochinskas, I had the seminar yesterday. The next one is going to be in February. I will post it here and message you! 

Welcome to a Free Landlord and Property manager seminar.
Take a moment and ask yourself the following questions!

How Can I Increase profitability for my investment properties?
How cab U Streamline Property Management?
How to market and find tenants?
How to pre-qualify tenants?
How to follow your city/state landlord rules?
How to find contractors and handymen?
Where to Find Opportunities to invest now?

Dispel fears of self-management! You can do this by yourself with the help of new free apps or all by yourself.
If you were able to answer just 50% then this seminar is right for you!
Get all your answers from one of the top 1% brokers in Chicago and have a session of Q/A with a 20 year veteran in managing/owning/selling RE.

Luminita Ispas, 773.392.2906, [email protected], www.luminitaispas.com

@Kevin Diamond, they absolutely do! Just call another bank!

@Kuriakos Mellos, you got it. Your scenario will work. Remember two things, you can have only one FHA loan at a time with the exception if you move markets ( different state, at least 100 miles away) and you have to occupy each property for at least one year.

I've had several clients this year that did exactly that. I found them some great 3 and 4 unit buildings that they did FHA 203K renovation loans and increased the value of the buildings by 25%. So in our market, Chicago, I've had a few of them refinance in a conventional 25% equity owner-occupants and they'll wait another year to buy another building with another FHA and a few have refinanced after they've occupied the property for a year to satisfy the FHA "owner-occupant" requirement and now they can buy another building with an FHA loan!

With the low-interest rates, it's easy to make the numbers work and by taking a 203K renovation loan you win on multiple levels: you get completely remodeled buildings that are easy to self-manage, gain a lot of equity and gain a very high rent!

Good luck to you!

@Balaji A., I messaged you the lender's info as we are not allowed to write them in the posts.

@Raj G., I agree with you, there are a lot of other ways to invest the money, and depending on your goals and the deals you'll find there will be other investment strategies you can employ. 

@Balaji A., I mentioned residential investment loan, 25%down with 3.2% interest rate. I am having a client buying a 3 flat in Chicago now with the rate and I will happily send you the lender's information. 

Let's be clear though, that's a residential, investment loan, not a commercial loan as I prefer the fixed interest rates to the commercial rates and terms.

@Raj G.that's a great problem to have! With very little extra info about your ability to take loans, length of time you intend to hold on the properties, how much time to intend to devote finding, remodeling, and renting the units, here's the plan I would advise.

I would invest in a number of 3-4 unit buildings and lock in 25% down conventional loans. While 1 million dollar sounds like a lot, after putting aside about 100K for reserves and if you need another 100K for improvements of the properties you'll buy, you'll have enough money left to buy only about $3,200,000 in properties, which depending on what neighborhoods you'll buy will translate anywhere between 4-8 buildings.

Why buy three-four flats? Because of at least four reasons:

1. FINANCING  - Lock in the historically low interest rates for 30 years fixed mortgages, which for investors are around 3.2%. If you were to buy commercial buildings, the rates will be higher and your return will significantly change when you'll have to refinance that building.

2. RESALE VALUE & ASSET DISPOSAL - 3-4 unit buildings are the easiest to resell if you want fast cash due to the fact that most buyers can buy them with $0 down, VA loans or 3.5%down FHA loans, and a lot of investors will scrape together the 25% down for a building under 1 million dollar. In other words: EASY TO RESELL FOR TOP DOLLAR. Plus you won't need to liquidate all your properties if you need only a couple hundred thousand versus having to sell your commercial property.

3. PROPERTY & TENANT MANAGEMENT - I call it Tenant Management as a lot of time the tenants moving in smaller buildings stay longer in the properties, and these buildings are easy to self-manage as most units have separate utilities, so fewer bills and less tenant turnover

4. APPRECIATION - This type of buildings have had the tendency to go up in value faster than single-family homes & even commercial buildings due to the fact that when you raise rents, you do it for 3-4 units at a time, which automatically raises values

Good luck to you and reach out if you need further strategizing!

@Jacob Winkler, Congratulations on your first steps! It seems that you know what you need which is amazing. 

A bit of advice when building your team:

1. 1. Make sure everyone in your team has been in Real Estate through the 2008 market crash, so they have had to be in the business for at least 10 years in the business
2. 2. They work full time in their business, they are passionate about this business and they'll negotiate contracts on your behalf over the weekend and in the evening when that's what will make all the difference to get that deal done.

1. 3. Each person on your team has to be a real estate investor. If they are realtors, lenders, home inspectors, contractors, accountant, etc,  they each have to own their own investment properties, so you can learn from their lessons learned as investors

Hope this helps! I will PM you with more info!

@Damien Papillo, Do you want to hear the hard truth from someone that has been in this business for almost 19 years, teaches people how to use this strategy and got burned again and again and again? 

You answered your question when you mentioned you work with multiple realtors. I am not sure what you do for work in life, while I am sure you get paid for every hour you work at your job. With real estate, there is this incorrect advice going around that investors should work with multiple realtors in the same areas. This advice, unfortunately, is what holds investors back, as if a property is on the MLS, all realtors have access to it. What that means is that you are asking multiple people to play in the same pool and you let them know that you are sending them to work, however only one person will get paid.

You expect every one of them to peruse the mls, do multiple comparative market analizes to make sure the property will work for a BRRRR ( each can take hours), do more CMAs for rentals, do showings, calculate the cost for you to make sure the numbers work, write offers, and if the offers don't go through as either there are multiple offers or the seller won't lower his price to your offera, you'll drop that agent after tens of hours committed to you for the next Realtor that calls you first with another property for the MLS.

Are you starting seeing an issue here? Why would these people want to work for you when they know the chance of actually get paid is close to zero as you are not loyal to them? Why will they commit their time when you are not?

If you truly want to have the deals, talk candidly with the realtors you think that are knowledgable in what you are trying to achieve, see if they've done any deals themselves or how they invest, make sure they work full time in real estate and commit to one of them. Let them know that you depend on them to find you a deal. You see something online or a wholesaler sents you a property you call them to run a CMA for you. You decide who is the person and stick with them. You'll be amazed how many deals you'll find when the Realtor knows you are loyal. She'll treat you like a gem an as soon as you invite them into your team and threat her/ him the same way.