All Forum Posts by: Maurice Smith

Hi Steve, I'll tackle this from a lender's perpsective. First of all, the 10-Year Treasury, which drives rates, has been spiking, so you're investment rates are going to be in the 8s, not the 5s. You can get 2nds (installment loans and HELOCs) on investment property at lower loan-to-values, but each instance is going to be different. It's really, really hard to get property that cash flows right now if you're financing...particularly at higher loan-to-values. To get the best DSCR rates, your monthy rent needs to exceed the Principal, Interest, Taxes, Insurance, and HOA Payments on the property. With skyrocketing insurance, taxes, and interest rates, that's a lot harder to do than it was 2 years ago. People on here often make it sound so easy...and if I see another "borrow the down payment" post I'll vomit. The economy and the real estate investment industry cycles...it always has and it always will. We've entered a period where you look for and can grab great opportunities, but you have to be patient with your capital. Most importantly, don't get ahead of your skis. Right now I've got one of my best clients that got himself overextended (against my advice) and now he's it deep, deep financial doo-doo. I didn't see the podcast you were speaking of, but I am of a mind that it's time to carefully think about each move you make as opposed to "go for it". Only do deals that really make sense and don't stretch. That's my take.

Whats the issue with borrowing the down payment? Thats what majority of people who use hard money/ private money use it for, either out right purchase, down payment or renovation. If you can find something that covers the mortgage and the hard money with the cash flow, and little to no money out of pocket seems like a no brainer to me.

yes deals that cash flow are much harder to come by then 2 years ago. But there are still plenty of deals in some of these smaller markets to be had, especially towards the mid west. Also, i have seen a few deals were you could assume the sellers current mortage and rate. I have seen some deals with assumble rates as low as 3.7%.

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Hello all,

Im a small- mid multi family investor looking to scale and add more doors to my portfolio. I have a few deals that im looking to make moves on. If your looking for a return on your capital, please feel free to reach out to me in the inbox.

Im looking to network with you.

lets connect!

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Oakland, California

Quote from @Devin Peterson:

Quote from @Greg Seivert:

David Greene answered a question on the podcast and I want to ask about everyone's personal experience with this. Like many investors now, I have equity in properties with interest rates under 3%. Should I cash out refi to a 5%+ rate to reinvest the equity? The current cash flow gets squeezed a bit in order to go for more appreciation and cash flow from additional properties. David Greene says go for it. What do you say?

Not a question someone can answer very easy. Here's what you I would reflect on:
- My next goal
- Are you okay with the reduction in cash flow to scale
- do you have the stomach / tolerance to make the move
- make sure you have an exit strategy

Miller you Hit it right on the head, " are you ok with a reduction in cash flow to scale" thank you for putting that into prespective

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Yes a equity line is preferred. But after doing some research, Its becoming difficult finding any lender who will take a 2nd postion on an non owner occupied investment property.

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*Pocket

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capital calls suck , sorry to hear that. Be cautious of who you invest with. I heard stories of asset managers doing capital calls , and then running off with the money. I hope you get it figured out.

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Hey Bp Family,

It has been a while since I posted on here. Im in need of some advice.

Im looking to roll some equity into a another multi family investment property, and also pay off some personal debts.

Let me give you some details on my current situation:

My Current Situation: I purchased this 4 plex in 2019 for 369k. According to the appraisal, it is worth around 725k. I owe 280k on my exsisting loan.

My current rate is 3.625% and my current mortgage is $1734. The property brings in around $5100/ month. This is one of my top preforming assests at the moment. My lender is telling me i can do a cash out refi and will allow me to go up to 75% ltv. I will be able to walk away with a little over 215k.

The Downside: 0ver 200k cash in my poket in a few years sounds good, Im happy that im in a situation to be able to do this. The issue im having is that my new rate will be in the high 8% range ( I have over a 740 credit score) My New payment will be around $4600 and my New loan amount will be around 500k. Yes the rents will still cover the new payment, but barley. One bad month is all it will take , and i will have to come out of pocket to cover the difference, which has me a bit concerned.

Do I have any other options besides doing a cash out refi to pull money out? I was advised that a 2nd mortgage would not be a option becasue its non owner occupied property. I Really dont want to touch my current loan, but im not sure what other options I have? After the fed meeting , it dosent seem like rates are going to go back down any time soon, i read something about only dropping 100 bps over the next 2 years. I also know that alot of commercial investors have bridge loans and baloons that are coming due which will force people to have to dump thier properties or get foreclosed on. Which will probaly result in a slight downturn in the market and more strict lending guidlines. If i was to wait to pull cash out my rate could potentially be higher then what im currently being quoted and worst case my current property value might not be as high as it is today. Resulting in me not being able to take out as much cash.

Any advice or recommendations would be greatly apperciated.

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I got my 2nd property ( triplex house hack) using fha loan dropped 3.25% down. if you currently used fha to buy the house your in now , then you will have to refi that loan to a conventional to free up that fha

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Tampa, Florida

eric is def one of the bigger pocket og's. i remember coming to you for advice back in 2019 when i purchased my 4 plex in vegas.

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All Forum Posts by: Maurice Smith

Maurice Smith has started 23 posts and replied 202 times.

Post: Cash out refi into higher rates?

Post: Attention All Hard Money/ Private Money / Lenders!

Post: Cash out refi into higher rates?

Post: Is a cash out refinance my only option to tap into equity on a non owner occ 4 plex?

Post: Is a cash out refinance my only option to tap into equity on a non owner occ 4 plex?

Post: Cash out refi into higher rates?

Post: What happens if you can't participate in a capital call?

Post: Is a cash out refinance my only option to tap into equity on a non owner occ 4 plex?

Post: Second property with little to no money down

Post: Two Ways to Cut Your Maintenance Costs