All Forum Posts by: Matthew John

@Rebekah Keller I am using asset based lenders now because I don't qualify for bank loans and I can put the debt under an LLC so it doesn't impact my personal DTI.

I'm looking at Tidal Loans as the best offer at 5.875% interest on a 30yr fixed and 80% LTV. I havent used them yet, but will update when I do!

@Alexander Wright I don't personally invest in Detroit, but if you were looking to capitalize on the recent Chrysler investment, I'd research the neighborhoods surrounding the plant. Look for other development happening the area, check the crime rates in the surrounding neighborhoods, and most importantly drive the areas. 

Even if we do see the Detroit comeback, I tend to agree more with @Christian Hutchinson in that the suburbs will see the most upside. Macomb County is, I believe, the 3rd largest county in Michigan and has seen some of the strongest population growth over the past decade.

I'm a Metro Detroit bull and believe we have one of the best markets in the country! Honestly, I think it's pretty hard to lose if you're local and actively managing your investments. 

@Nicholas Bastianelli Yes, I have reached out to them all. You're going to see appraisals based on comps for anything under 4 units, nothing you can do about that. Some of the companies she referred me to didn't answer or didn't know I was talking about, some offer these loans but the terms/fees aren't great. So far, the best one I have found is Tidal Loans. I haven't closed anything with them yet, but I'm hearing 80% LTV with 5.875% interest rate for a 30yr fixed.

@Ryan Keenan Yes they are for 1-4 unit. I have, but can’t find portfolio lender who will service single properties with no docs. I don’t have the tax returns to qualify for traditional bank loans so these are my only options.

@Rene Doyle Nope this is just a single private lender on a small multi family. The seller is financing 98% of the purchase price and the lender would be funding the down payment + rehab.

@Rene Doyle Me either, but I know many people must do it here.

For people taking down large multi families with seller financing & still raising money, how do they secure the investors interest?

If I buy a $5m property and need to put down $1m and the seller finances $4m, most people will have to raise the $1m. Unless they’re giving them equity, I’m curious how they’re structuring this.

Hey guys, 

I just got a Multi Family property under contract and I want to bring on a Private Lender to fund the down payment and rehab costs. 

I'm trying to figure out a way to do this so the Private Lender is protected when the Seller will have a first position lien on the property. 

Normally, I use a combination of a Promissory Note and a Loan/Mortgage Agreement. 

The Private Lender will be lending from an SD IRA so we aren't allowed to give them equity in the property and also use them as a lender. We just want to figure out a way for them to lend money at a fixed rate and protect their investment somehow.

December Update

The numbers look great this month! I've increased my prices because I expected more travelers for the holidays. A lot of people have family back in Michigan and it's a popular time to visit during the holiday. I've decided to take advantage by adjusting my prices higher 30% higher than the last month. I've hit a record month in revenue without booking all the days. 

Despite the record month, I did have an issue with a guest...

One of my guests flooded the floor in the bathroom and it leaked into the kitchen below. My cleaner got there after the guest left and the bathroom floor was pooled with water. She thinks the guest overflowed the tub or accidentally left the water running when running a bath. This was coming through the floor right below the tub. 

I contacted Airbnb support and they assured me they would pay for the damages, right now I'm going back and forth with their Case Manager. 

I'm working on reassessing the damages now with my contractor, but it's going to be $3000 or so to fix the damages. This will be the true test of Airbnb to see if they stand behind their host guarantee program. I can file a claim with my regular insurance company, but I want to see if Airbnb actually backs up their hosts.

The biggest problem is now I'm booked the entire month and I have this damage to my property that needs to be addressed. It's possible that more guests could worsen the problem, but Airbnb has not given me any updates on canceling my current reservations. Right now I'm just trying to stick it out until January because I blocked 2 weeks off to address this issue. I cannot fix this damage to the property while guests are staying at the house and if I cancel their reservations on my end, I get punished. 

I have blocked off 2 weeks in the beginning of January as that's the earliest time I can get access to the unit and have my contractor solve the issue. We'll see what Airbnb does up until that point. 

In other news, I am deciding to turn another unit over into an Airbnb. 

So far Airbnb I think is going well (other than this latest incident) and it's generating more income than I would normally receive with LTR. This next property is about 2 miles away from my existing Airbnb and it's a 2/1, 830sqft, SFH. Great location in relation to this one and it's not a duplex. If Airbnb, it will still rent for $1000/m, but I've already furnished it and I'm getting it ready to list. Will keep everyone updated on how this all progresses!

@Kerry Baird I contacted every single one you mentioned! I am going to try them out and get back with feedback. Open to anyone right now! 

@Kerry Baird Thanks for the reply. Have you used any of these lenders yourself?