All Forum Posts by: Michael Dallas

I appreciate it thank you will do!

Thank you for the response! It is a seller finance deal that I got off market through connections with the seller. He wants to help me out and walk me through this process and give me a good property. The lender is a great guy as well and just wants a solid overview of the deal.

Hey BP! I am currently under contract with a 9-unit multifamily. I have already talked to a private lender of mine that tentatively agreed to lend on the deal. I just gave him some easy round numbers on the deal, and he said it looks great. But before we go through to put together something more specific on the property so he can see all the numbers. What is the best way to present him with these numbers/data? And what all should I prepare and talk about? 

I was thinking along the lines of just a few slides of a slide deck showing the property and the potential. Is there anything I need to make sure I add? Or anything I should stay away from talking about? 

Thank you so much to everyone that helps out!

I have already met with the bank, and the seller has a great relationship with them because he has done a lot of business through them.  And the bank has already confirmed it is okay with them, as it is a local bank that holds the note themselves. So yes, more like a subject to where I am just picking up his payment.

I have already househacked a rental I still hold, so worst-case scenario I would pull a line of credit or bring in an equity partner if more capital was needed. 

Thank you for adding to the conversation!

Thank you so much for pointing this out, as I am obviously new to this. What would you suggest as a number or percentage after the refi/sale that would make sense for the lender?

Thank you for shooting me straight! I know I am going to make mistakes and wrong assumptions, but I hope to lean as much as I can so I don't make them anymore! 

Thank you for the input that would definitely be a great idea. If you would could you take a look at the reply above at the information I provided about the deal and then give your feedback on that. Thank you so much!

Thank you for the very specific response! I have not added all the details to this deal to give the full background. This seller is an older guy that bought this deal for his son and his son up and left a few years into it. When I got given this opportunity and talked to the seller he really just wanted to help me out and get me started. He has bought and sold over 300 million dollars worth of real este and doesn’t care that he’s going to lose some money by almost giving me this property. He said that he wished his son would have stuck with it so instead he wants to give the place to me. 

I’ll give you some quick numbers.

There is $385k left on the loan I am assuming from the seller at 4.25% for the next 2.5 years. 7 units currently are rented out paying $725 a month and I have documentation of this. There is also a single family house on the lot next to it that is included into the deal that I will be rehabbing and renting out for $1300-1450. 

They got the place appraised last year for $560k and that did not include the 3bed/2 bath single family house that I am getting in the deal. 

I have already talked to many people in the area and ran some comps and I will be raising rents to $850 starting Jan 1. On top of this the seller is prepaying all my expenses through May to help me out so I can stack up some cash while I graduate college. So in that time I should have around $25-30k in pure profit saved up in rents.

Once I have finished the rehab and stabilized the property I plan to either sell or refinance within the year. Which is why I told the lender there is very small risk because I will have a lot of cash and equity already in the property. I have the appraisal documents and everything checks out. 

I know this is a great deal is why I am wondering why there is a hold up. But I appreciate you showing me where he is probably coming from. Although he has been given all of this information. Thank you again for the response I look forward to farther conversation!!

Thank you for the insight! Would you have any recommendations on how to structure this private money loan that makes sense for the lender? 

Hey BP, I am buying a 9-unit multifamily property, and I am picking up the seller's loan. All I need to do is come with $95k as a down payment. I have been talking to a local guy I know who is an agent and has money to invest. He is interested in the deal but has been dragging his feet and finding it hard to get on the phone to talk to and communicate with. I feel like I am asking for pretty good terms that would benefit him, and if he wants different terms, let me know. Although he has not been very responsive, he still says he's interested. 

What I presented him with is a $95k loan at 10% interest only payments for 2 years, at which time I will either sell or refinance and pay the whole $95k back. Would be around $792 payments per month in just interest. Is this a good deal for him? I am at the point of saying I need a solid answer now and just looking for someone else to finance the deal. I am supposed to close on the property next Friday, so time is of the essence. Thank you everyone that helps!

Hey BP! I am currently going through the process of closing on my first multifamily deal. With the 8 multifamily units, there is 1 single family house on the lot as well that I am buying with the deal. This will be my 1st full rehab, as the outside was done but not the inside of the house. The framing on the inside is up, but that is all. I am trying my best to take everything into account, but there is no doubt things I don't know. I am getting 3 estimates on the property in the next week but could also do some of the work between my dad and me. I'd love any advice I can get and learn from people who have already been there before. Thanks everyone for the help!