All Forum Posts by: Matthew Lindsey

@Caroline Gerardo. Thanks for the reply. The reason I believe a commercial loan is needed is because there will be more than 4 units on one parcel of land. There will be six units on one parcel of land. I wish I could find someone to that does residential conventional loans for over 4 units and would use DSCR for eligibility. I just haven't come across anyone that offers that yet. I'm waiting to hear back from the city on the build back rules.

Hi,

I’m looking at a off market property. Well it’s actually three different parcels with three duplexes on each parcel for a total of 9 duplexes. They were built before planning and zoning come into play. Built in the late 80’s to late 90’s. The city no longer allows the building of new multi family. These are zoned for single family but are grandfathered in. It would have to be a commercial loan being each parcel has 6 units on it. Does this hurt the resale value or future refinance deals? Does this worry seasoned investors? When you do a commercial loan does non conforming come into play. I read on here about people having issues with non commercial loans. Please let me know your opinions. Thanks

@John Teachout thanks for the reply. Yea I'm certain that they would have would have to be bought in groups of 3. I'm not sure yet but sounds like they want to sell them all together. Actually they aren't 100% against Owner financing yet. They want to talk to their accountant about it first though and he may change their mind. I've never dealt with commercial real estate loans. Not 100% sure I can get one with my LLC just being started in May of this year even if I have the down payment. The LLC owns two other duplexes out right but I doubt that helps either. *I'm just not sure what steps others would take now. Do I try to get them to agree to a lower price then get a contract on it or do I get a contract on it then renegotiate during due diligence? They are supposed to let me know about owner financing by Tuesday.

So I sent a letter a week ago to a owner of 9 duplexes in a small town that I live very close by of to see if they would be interested in selling some. My research showed the owners were in there 80’s. Anyways I got a call yesterday from the daughter of the owners and she said her parents were interested in selling since they are older and would sell all 9 duplexes to me for 1 million total. I wasn’t ready for that. I would love to own all 9! Duplexes compared to these would sell individually for 150k-240k each within a 10-15mile stretch from where these are located. The area is a nice rural area, small town. I didn’t make a offer of anything yet I just asked for information on the rents and that I was interested. I don’t know where to go from here. Please let me know you options, I’ve never come across a off market deal. Of course I want the best deal I can get on them. I’m not a buy and flip I would buy to hold. Also, not sure how it affects the value but the duplexes are in groups of 3. 3 duplexes on one parcel of land. Any help is appreciated. Thanks.  

Hi, Ill start by saying I am a newbie. I just made my first investment in July on a two duplexes. I really enjoy being a landlord so far. I have recently taken the approach of sending letters to owners of multifamily properties to see if they would be interested in selling. I have only sent a few letters and only to a couple properties that I would love to have. Not really expecting to hear anything back because I figured if they wanted to sell they would have it on the market already in todays market. Believe it or not I actually got a call back today. The owner is interested in selling because they are in there 80's and it just might be time. They threw out a price and I didn't say yay or nay but that id like to know more about it first.(seemed like a decent price) 

Here is where the questioning comes in. They have 9 duplexes on 3 individual land parcels. So that is 3 duplexes per parcel of land which means 6 unit on each parcel. That puts it over the 4 unit rule for a residential loan option. I'm afraid since my LLC was just created in May of this year its going to be impossible to get a commercial loan. My LLC owns the 2 duplexes I have free and clear but I doubt that will help in any way. By the way those duplexes are also on 1 parcel also.

-What are my chances of being able to get a commercial loan for this situation? 

-Would the loan have to be 3 individual loans all with separate fees or can it be lumped into 1 loan? Would it be smarter to have 3 individual loans anyways for cash out refinancing later?

-What are some likely terms and interest rates on commercial loans today? If it matters, I'm in GA.

Ill take any tips or pointers that can be given. I just got the call today and I really want to take tomorrow to crunch the numbers but I dont know what the realistic terms and rates would be for a commercial loan. They are supposed to get me the rental numbers soon but gave me a average number to base it off of to start with. But they did mention they might entertain seller financing once I mentioned it could benefit them, but I'm not counting on it. 

Thanks in advance!  

@Matt Devincenzo Thanks that’s the sort of response I was looking at. @Account Closed I’m not going to turn this into a discussion strictly about covid. It was just a question asking what others have done basically to distance the final steps to get the tenant in. I’m not one who normally fears catching covid but I would like to minimize my risk this particular week with vacation coming up next week and being around my 3 month old and 3yr old more. “Sniffles” or not I don’t want to give it to my kids.(I know they aren’t as likely to catch it) 

Thanks everyone I have it figured out now. 

@Scott M. Thank you for the reply. I don’t get a feeling that this is a way to buy her time or get out of leasing it or anything of that nature. I guess it maybe more that I don’t want to risk catching COVID but on the other hand I would like to get her in the unit and have this behind us. She left it at “not knowing if we still wanted to meet her this evening”. Does everyone sign the actual lease in person and do walkthroughs one on one with the tenant. Or is there other options like signing the lease online and us doing the walkthrough then when she signs the lease and the unit is hers then she can sign it as well or is that asking for trouble?

Hi,

Im still pretty new at all this but I need some opinions on what to do. I put a freshly renovated unit on the market and found what I believe should be a good tenant to fill it. The goal was to have the new tenant in by the 1st of September(or at least be done with paperwork and hand over the keys). Well, we have the deposit to hold and we were to meet and do the walkthrough for the new tenant move in checklist today and finalize everything. I knew yesterday the tenant wasn’t feeling the best and today I get a message stating the tenant has tested positive for COVID. I don’t feel like the tenant is trying to delay anything they just wanted to let me know about it. I feel as though it might be a legit case of COVID. I guess my question is, what are my options now? Do I have any options or do I basically have to wait 10-14 days to meet with the tenant, get them in the unit and then collect a prorated rent? The tenant is just one individual. This is my first new tenant, I inherited my other tenants. Does everyone do a walkthrough move in checklist with the new tenant? The tenant is ready to pay the months rent and I’m sure if the tenant feels up to it wants to move in before 10-14 days. The unit she has been in for 6yrs was sold and she was supposed to move out around 9-1. Please let me know your thoughts. Thanks

@Nicholas Weckstein @Scott M. @Colleen F.

Thank y’all for your advice. I really do appreciate it. It’s pretty clear as to what I should do. Thanks again!

Hi,

I’m looking for opinions on my situation. I just recently bought two duplexes. One unit was vacant and we renovated the unit. We just listed the unit yesterday and have had a crazy amount of interest. I have been watching rental prices in the area for several months now. I thought the price I put on the unit was a decent price point compared to what I had seen. However I was contacted yesterday day by another investor that has a duplex just a few houses down and he stated he was getting more than that for his units that have not been renovated. That I may be at least 10-15% low. The problem now is that I already have showings for Friday now. Would y’all pull the listing and update the price or would you take this as a lesson learned and rent it at the list price then increase soon? We are going to just do a MTM lease on the unit. If you say pull the listing what do I tell the ones that are set up for a showing on Friday? Thanks for your input.