All Forum Posts by: Mark Delosreyes

Hey everyone, I'm a real estate investor looking to do a cash out refinance on a portion of my rental portfolio. DSCR portfolio loan that can combine SFH's within a city and some potential rural SFH's. I even have a mixed use property I'd like to throw in if any lenders can get that creative, but that one's not a deal breaker.

I currently use several DSCR lenders for my BRRRR's, but the 2 main issues I'm running into on this portfolio are: 1) unable to finance the rural properties, and 2) unable to finance the mixed use.

Thanks!!!

@Bonnie Griffin Kaake, thanks very much and this is really helpful. Part of my W2 job is a financial controller for a decent sized lumber manufacturer. What I enjoy most is creating ROI models for multi million dollar equipment, sales margin reports with over 1000 products, financial statement analysis, etc. I really just need guidance on the details of a study, and I would be able to create my own. For that, I'm willing to buy the first one. As a corporate VP, I understand the importance of compliance/engineering firms, so I wouldn't share my model with anyone else. I am in the process of getting a no cost analysis done (connected from this post), so I'm excited to see the summarized results.

On to the beach house I purchased in June:

$500,000 purchase price

$100,000 land value

Spread out amongst my LLC's, I have fixed and flipped about 12 houses in 2022. I have a rough projection of what my capital gains will be so far. Normally, I we would buy a few fixer uppers, expense off all eligible repairs, then rent out. So, show a loss on rental properties to offset the sale of homes. However, if the cost segregation can provide a higher tax savings, then I won't bother buying a LT, fixer upper rental.

I have another STR beach house under contract and will close next month.

$600,000 purchase price

$100,000 land value

Any guidance/advice is much appreciated. I love the BP Forum responses from all of the super smart, experienced people out there…thank you all very much!!!

Should I do a cost segregation study on a short term rental beach house I purchased? Does anyone have experience with this?

@Kaylyn Geiger, awesome question, as I am thinking the same thing. I'm a mid level investor, 50 rental units, 20+ BRRRR deals, and flip 5-10 houses per year (at least in this market). I feel really comfortable in that space. I purchased my first ST rental in a popular vacation area, just last month!!!! The purchase price was 5x higher than what we usually buy, and I knew little about ST rental platforms. I still have a lot to learn, but here are a few things I'd recommend:

1) really know the market you want to invest in. I live about an hour from the beach house we just purchased. Thousands come every summer, and it’s been that way for 50+ years.

2) know your numbers. I’m an accountant and have built a lot of simple tools in calculating a property’s performance. The one I purchased will do great as a ST rental, even if I lower nightly rents below the surrounding ST rental properties.

3) have a back up plan or 2. Google AirBNB and the city you are interested in. You should be able to find a link to the regulations on ST rentals in that area. If ST doesn’t work out, back up plan # 1 is to hire a local weekly rental agency to rent out our property; back up plan # 2, LT rental or rent by the room. These won’t cash flow like a ST rental, but still more than enough to cover mortgage and expenses.

I’ve listened to about 4 audio books in the last few months on ST rentals. Most say invest in an area near a beach, mountains, or a national park. People will always vacation in these areas.

I do plan on converting a few of my local LT rentals into ST, just to test the waters and see how they perform. Message me, and I’d be glad to share any of my tools, knowledge, etc. I’ve been investing for about 5 years now ($0.00 of my own money), and still have a lot to learn, but would love to help in any way.

I was going to post this question this morning, to get people’s thoughts, and this came up first on my trending forums. Haha, thanks for posting first and thanks for all of the insight from the other people that commented.

@Nathan G, I reached out to my city zoning, and they gave a lot of useful information if I wanted to make the change. Unfortunately, my lot size is not large enough to convert to a duplex. The empty lot next door is owned by the city, and that’s available for purchase. After a recombination of plots, I would have sufficient lot size. I would then need to meter each unit separately. The total time and invest would not be worth it, so I plan on selling or keeping as a single unit rental. Thanks for the advice!

I am looking for a DCSR Lender (or recommendations), for Short Term Rental/Vacation Home in the name of an LLC, 10-15% down. Thanks!

@Joe Norman, thanks for the advice. Did you reach out to your city zoning before converting to a duplex, or did you just do it?

I am converting a single family home into a duplex. My current property manager will not manage a property without a physical address. What is the best and easiest way to add a second address, legally?

@Doran Summers, DTI is solid, and we still have a decent amount of exposure limit left with these local lenders. @Kevin Romines, however, they typically only offer 15 yr am on commercial loans (all units in LLC), so strong cash flow ($250+ per month per unit is our target) is challenging. I keep seeing private lenders willing to do 30 yr am on investment properties owned by an LLC. I have a certain group of properties that will be paid off soon, so a 30 yr am doesn't make sense; however, I have another group that I would really like to boost cash flow and put on a 30 yr am.

@George Despotopoulos and @Jonathan Hatton, since this post, I've had about 5-7 private lenders reach out to quote terms. So far, rates seem favorable without a buy down, and they all offer the 30 yr am. I'm hoping to build a relationship with 1 or more of these. For the past 20 years, I've been a financial controller in the manufacturing industry. A lot of money is borrowed for capex, so my accounting has always been structured to please banks, CPA's, etc, at the push of a button. I do the same with my real estate LLC's...just over the grind of all of the intense bank reporting, 300 page tax returns, audits, etc.

Thanks again for all of your input and help. I’m looking forward to a positive shift in my business model.

Sincerely,

Mark Delosreyes

Hello, I am searching for a lender to build a long term relationship with. We currently have about 50 units in our rental portfolio, and are always looking to add deals, if they make sense. We use the BRRRR strategy for most of our new purchases, but would also be looking to refinance our existing portfolio. We are currently using local banks, but just wanted to test the waters on a different option. Thanks in advance for any references and/or advice.