All Forum Posts by: Michael Glist

Is this a property that would be strictly an investment property or would you be looking to occupy one of the units? 

You will 1st want to make sure that the lender you are going to finance with is ok with that as the source of down payment. If you are looking to get conventional financing this will likely be a no go as they will require your down payment funds to be your earned funds and not a loan. 

The term revolving is typically referring to credit card stacking where you get approved for a few cards with a total combined limit of lets say $80,000 and then turn that into cash and use it for down payment. The thing to be aware of in this scenario is that maxing out your credit cards like this will definitely take a toll on your credit score so you will want to make sure you are already pre-approved with a lender and see what their policy is on credit. Some lenders will pull credit initially and that is all some will pull it a 2nd time before closing to make sure nothing has changed which is where you would potentially come into a problem with the new credit accounts as well as the lower score. 

If you get a LOC from a bank/credit union you will want to ask about the payment terms. Some will only require payment if/when you draw form the line of credit where as others will give all the funds up front and start payments.

You will also want to make sure that you take into consideration when looking at houses that you will likely 3-12 months reserves for the interest only payments (in going hard money) and you will also want to factor in payments for the LOC as well this way you know how much of the LOC you can put down and how much you will need to have set aside to make payments while fixing up the property (assuming it is a flip).

Again this is assuming you are using a Hard Money Loan or private financing as this would not work with traditional financing. If you are going towards traditional financing I would contact a local mortgage lender to discuss their guidelines. 

Yes would would need an LLC (or business entity) as well as an EIN to apply for a business LOC in most cases. I have seen it be done if the business is acting as a sole proprietorship but they did have a track record and was not a new business.

I hope this helps. 

I think it will depend on what type of lending you are looking to do. Are you looking to fund people down payment for fix and flips, are you looking to lend for the purchase and rehab of a flip are you looking at funding for long term rentals? Depending on the route you are looking to take and what your approval process for funding looks like will determine what you should charge as far as interest, fees and points go in my opinion.

There are alternatives to bank financing like non QM lenders or lenders that offer long term financing for renters. The thing you will want to look at is if you take financing now are you going to switch over to conventional bank financing once this all dies down. If so your best option in my opinion would be a short term rental loan 1-3 years this way you getting a better deal upfront with the plan of refinancing here once everything goes back to normal. 

Private money will typically get paid either monthly or upon selling/refinancing depending on the strategy you take and what your agreement is with them. So if you are looking to get a private loan to help you purchase a flip then they would likely get paid when you sell that property. If you are looking to get money to purchase a rental then they would likely set up a monthly payment kinda like having a second mortgage or HELOC. The best person to talk to about actual terms and repayment would be a private lender as they are all different and may have different rates and terms based on the plan and the property itself.

I know a few people in the springs that I may be able to connect you with. They are all active investors from wholesaling to apartment building owners. 

That is very unfortunate, I am sorry to hear you are having issues. I do not think that you would be able to evict him based on that reasoning. First I would check with your county. Even though everyone thinks there no evictions during this time due to the virus that is county by county based and not all counties are following that and are still allowing evictions. But either way I do not know that it would go through as I doubt it is in the lease that he cannot have people over even during a time like this. I would recommend either taking additional precautions on your end to stay safe or maybe even offering him 1/2 off his rent to stop having people over. Yes you would take a loss in rental income but evicting him would be a loss as well and this may get him to play ball. 

This is just my opinion and would recommend talking to a real estate attorney for more accurate advice. 

Yes there is, it will typically be in the form of an unsecured personal Line of Credit or the most popular of Credit card stacking and cashing them out to use the cash to purchase homes. 

It is possible, and depending on the lender you are using it should not be a problem. Also if the operating agreement is what is holding you back I would say spend a little time on making one so you can satisfy the lender requirement if that is needed. 

This is possible. Most lenders will have a $50k minimum for properties that need rehab work ad a $75k minimum for refinancing rentals. You can look into a portfolio loan, I know most lenders will require at least 10 properties to be in the portfolio. You could also look into a personal LOC and then pay that off once you sell/refinance the property.