All Forum Posts by: Matthew B.

Thanks, Jeff!

I actually did something similar to what you're describing. I figured out the max amount I'd be comfortable with borrowing against each property, an amount that wouldn't push cash flow too low, and then added everything up. To use your example, it's $180k.

The question then becomes, do I borrow $180k against all of the properties at a low LTV, or do I pull the entire $180k out of only a few properties at a much higher LTV?

The second scenario would result in fewer mortgaged properties and would increase the cash on cash return of the portfolio as a whole, but if you look at the mortgaged properties individually they may each have negative cash flow.

I guess this is essentially what I'm trying to figure out/decide.

Hey Luke, I've actually found a few lenders that are offering loans with 30-year fixed terms. Lima One Capital and Kiavi (formerly LendingHome) to name a couple.

I do have a line of credit against some of the properties. I'm looking for more permanent financing this time around since the money from the refi will be used to purchase additional long-term rentals.

I own a bunch of rentals free and clear, and I'm looking to free up some cash so I can buy a few more. I'm looking into blanket loans -- one loan for multiple properties. I figure this will save me some closing costs.

I'm a fairly conservative investor. I don't want to pull cash out of all of the properties in the portfolio just because I can -- I only want to pull cash out of a few of them. In my mind, there's no sense in pulling a bunch of cash out if I don't have an immediate use for it.

In this situation, is it better to run the numbers for each property individually, or for the entire portfolio combined?

When I analyze the properties included in the refi individually, the mortgage payments push some of them into negative cash flow. However, the cash on cash return of the portfolio as a whole increases.

I don't want to get into a situation where the cash-flowing properties are subsidizing the non-cash flowing properties. Some properties can handle 70% LTV and still cash flow. Others stop cash flowing if you pull out more than 20-30%.

What's the best way to look at this? Make decisions based on the portfolio as a whole, or for individual properties? I'm sure different people will have different opinions. I'm just looking for some perspective I guess.

If it makes a difference, I'm looking into 30 year fixed loans and planning to keep the properties for the entire 30 years.

I sold a flip to them earlier this year with zero issues. They paid all cash, $15k over what it would have appraised for at the time.

I have the opportunity to buy a duplex in a neighborhood where 90% of the other properties are owned by the same landlord. Their properties are ok for now, but my concern is that this landlord could get lazy with upkeep/screening or could sell the portfolio to a slumlord and the neighborhood could go downhill quickly. 

Has anyone dealt with this before? Would you buy there?

It fits the definition of regional for sure. We actually leave the popcorn in our rentals if it's in decent shape. The tenants don't seem to care.

We go with knockdown on the ceilings and walls unless the existing drywall is in decent shape. No one uses smooth in Florida. It shows every imperfection.

100% rents collected, even from the tenants in the service industries. I love my tenants!

That's why so many investors have turned to flat fee MLS listings. Most Realtors can't justify their value.

You don't realize the guests on the podcasts are full of it until it's someone you're familiar with who is doing business in your market. Not just the BP podcast, but other big-time "credible" podcasts as well. I've always thought podcast guests should be vetted more thoroughly, but no one cares as long as they get downloads. I remember yelling at the radio in my truck one day at a guest on a non-BP podcast who I knew for a fact was lying due to previous experience with him. It kinda ruins the whole podcast once you hear something like that.