All Forum Posts by: Mike Dorneman

@phillip Davis I’ve done this and it’s worked very well. Currently, I’m under contract and using my HELOC to fund this deal. After the renovation is complete, my bank will refi the property with a commercial loan. I then pay off the original HELOC and can do it all over again.

Richard Ballard I think you’ve built a solid screening process. This is an opportunity for a perspective tenant to show you they are serious about your property. I have a similar process which requires the applicant to contact me at a scheduled time for a phone screen. Stay with your process and you’ll find the right tenant for the long term! Good luck

Shawn Clark thanks. I went with the title company to process the closing because they also provide me with my title insurance. The seller was a bit “unique” ;) so I wanted to make sure all the T’s were crossed and I’s dotted.

Just went under contract on a bank foreclosure. The building has been vacant for a year and utilities are off. The bank is unwilling to turn anything on for my inspector to test. That said, I’m planning on having a plumber do a pressure test on the plumbing to check for leaks. Any other suggestions out there aside from additional having a traditional inspection?? Thanks!

Hi Karen- I’m up in NE PA and closed on my second cash deal 2 months ago. The process was fairly simple and worked out great. The owner listed the property via newspaper and after reaching out to his Ad and taking an inspector through the building, we agreed on a price. I then called the title company that did a previous deal for me (with a realtor) and told them I was buying a house direct from a seller without realtors. They sent me a boiler plate sales agreement which I filled out and sent to the seller. He signed it and sent it back to me. The rest was like any other closing, we ran title and 10 days later met at the title office. I provided my title company a cashiers check and they provided the owner with his check. Done deal 😁 Is there anything specifically you were wondering about?

Just completed my 2nd deal, both of which were reno's and now rentals and currently working on my 3rd. My wife and I both have strong W-2 incomes and our first 2 deals we paid for with cash under our names. We've since formed an LLC and will be financing and purchasing properties under said LLC moving forward. We want to utilize the BRRRR strategy with a commercial loan moving forward. I also own a small seasonal business that can either show a minimal financial gain for 2017(about 35K), or a loss. Showing a loss would benefit us significantly due to being in a high tax bracket.

Question: Since we will now be applying for commercial loans, should we bite the bullet and show that our other side hustle was profitable this year to increase the chances of becoming "bankable" from a commercial perspective? Or do we show the loss to get the significant tax benefit? **I am meeting with my CPA in a few weeks, just interested in hearing what others may have done. Thanks!

@carmelo Caban I’d be interested in hearing about it. I walked through 2 deals in that area earlier this week that we’re not right for me.

Mike Springer thanks Mike! I’m heading to an investors meeting tonight with some other BP followers so I’m hoping to learn about some local banks that will be willing to work with me. Good luck to you!

I may have gotten myself into a tight gut spot early on in my real estate career. I purchased a property with cash under my name, rehabbed and have it renting at a great rate and have about overall 4% after all costs which is great! I leveraged this property with a HELOC and bought another, however under an LLC. (As per my accountants advice). The issue I’m running into now is continuing this process. I’m unable to HELOC the 2nd property because I have it seeded under my LLC. So my options as I see them are to begin the process of seeking a commercial loan or transfer the 2nd property back to my name. I’m sure there are much better options that I simply am not aware of... any advice would be greatly appreciated! So you have all he details, after purchase and rehab cost I’m into the 1st property for 35k and it is rented for $825/month. The second property total investment is only 22k and that also is rented for $825/month. Both properties appraised right around 55k. Thanks!

@Bob Derwin Thanks for info Bob. Is the meeting 7:30am? I ask because another real estate group meets tomorrow at the same location at 6:30pm.