All Forum Posts by: Michael K Gallagher

Hey @Chance B. I exclusively work with investors in my business and as you can imagine no investor wants to be tied down to a single agent.  So I essentially operate where if I write the offer and or bring the client the deal then we have a "exclusive" contract on that property.  They sign an exclusive agreement essentially just on that property.  It just brings some officialness to the agreement and I actually need it for my broker's compliance documents.  They require it as part of the transaction.  

Some other thoughts that may or may not help understand things: Any property you find on MLS will come with an established buyer broker fee/commission. Where you tend to see a seller refusing to pay the commission, is in an off market situation or a commercial situation. In both cases what usually happens, granted it can differ by market, is that the "buying agent" would come to you with a deal thats off market, and usually will have an idea of what the seller wants for price. Then they would most likely tack on a "fee" or "commission" onto the sales price when they bring it to you. So while yes you are technically paying the commission, but its all rolled up into that one number. Then there is language in the contract or LOI, whichever is being used, pertaining to the buyer broker fee. Its not an additional charge you pay. Unless you'd like to work it out that way.
   

@Ari Newman I’m apparently sleeping under a rock, but thank you for this thread and all the responses. Much appreciate the info! Fascinating stuff!

Hey Ryan, first off congrats on jumping in!  if you are going to be speaking to the sellers realtor, I'd suggest you also getting an agent, perhaps an investor friendly one if you can manage.  But if they have representation, you are not doing yourself any favors not having your own representation. As far as questions you can get a pretty good picture from:

1) are utilities all separated?  

2) list of any capitol improvements

3) age of mechanicals

4) is there an HOA or condo association.

5) current taxes, or any tax abatements in the area. 

Those are just the basics but usually give you a pretty decent picture of the deal just from those.  

If they don't know a lot of this off hand, its easy enough to find out during an inspection period.
 Good Luck!  Cheers, 

If it were me to start all over again it would be a house hack.  as many units as you could get initially, and then learn to manage, and from there you'll have so much opportunity and a great financial foundation.   

It is not a prop management specific software, but I'm a huge fan of Monday.com for these types of things.  It is so versatile, and can be set up to do anything and everything in your business.  It can manage rehabs, send reports to clients, communicate with clients, accept service requests...really can be set up to do anything.  I also like it because it is so flexible its one solution that you can grow with and keeping adding to, without having to change platforms at some point. It also integrates across any other app you might be currently using.  Slack, Gmail, dropbox...etc.  

@Nick Folwell I think I understand correctly that you are BRRRR ing a property, and after you are done and the re finance happens, you are still short to pay back your short term lender....If that is the case....and not knowing anything else about the deal I'd say yes. If you can pay out of pocket and you plan to hold the property for a while, then yes the time will heal all wounds as they say. I'd personally justify it from the rental cashflow. See how many months of cashflow it would take to pay you back your out of pocket costs to the short term lender. But if you are planning on holding it for at least 3-5 years, more times than not its worth taking the hit now for the long term benefits. If you'd like some help drilling down on the numbers and the returns thats really where I nerd out so I'd be happy to assist if I can be of value.

Hey Greg, not knowing too much about the property, but in general a 2 unit would qualify for a conventional fannie freddie loan. Depending on your lender the rates/terms will change but generally its going to be an 75-80% ARV loan and rates that I'm seeing for my clients on investment loans are in the 3.4-3.8 range at the moment. If you are buying cash, there really should not be a seasoning period that you need to abide by, but you'd want to get all the work done that you have identified so that the appraisal comes back as strong as it can.

In addition to approaching good mortgage broker in your market for this, I'd also recommend reaching out to any local credit unions you might have in your area.  They tend to be able to offer "portfolio" products where they actually service the loan themselves, and they can usually be more creative if need be.

@Keith Miller this is fantastic!  I cannot wait to read all about your Great uncle in his biography!  Thanks for sharing this, I myself have read vivid vision twice, and have still not don't my own vision...thanks for the kick in the butt to go take action on it!

Hey @Jason H Kantor ! I as well have always run into this issue. I have not really found an "easy" way to do this on a mass scale, but social media specifically Linked in has served me well for finding the officers or owners of those LLC's sometimes. You may have some luck mailing those LLC addresses but many times those addresses are just the lawyers office who set up and is representing those LLC's. I'm sure there are many others smarter than me on here though with some better tools.

That really depends on the situation you were in before hand.  I compared the "cashflow deficit" as you said to my cost of living before hand. And even with having to pay to live in the duplex it was still about 1/2 of what I was paying before so that was a win for me personally.  Again maybe not the glamorous win that you hear about all the time but for me and my family at that time it was a base hit, and really helped us get started investing. 

If you check the numbers on the property after you move out, I'd suggest making sure you are getting at least $100 per door pure cashflow.  Now what will likely happen is by the time you leave in a year or two or three even, rents will have gone up, so more than likely you'll be doing better than that, but if you can see as a worst case that with current market rents and you not living there, that the property cashflows at least $100 a door, I think thats worth going after in a big way.  because once you get into the house hack, there will be many ripple benefits you never planned on.