All Forum Posts by: Nathan Trunfio

@Eric Geiger Our closest reps are in IL (we're actively hiring throughout all Ohio markets though!) Please send me a message and I can get you connected with a Sr. sales rep.

If possible, collecting rent via ACH is ideal.  Your bank should be able to facilitate this.  There shouldn't be fees associated with it, and if your tenants are currently dropping checks off at the bank, this would be a win-win.

Here in Eastern PA (Philly and suburbs) inventory is still tight, but you can start to see more homes coming on the market at a faster rate than months prior. DOM is still low, pricing is either stable or increasing, and the amount of homes under contract still surpasses the amount of available inventory in many areas.  

With the election uncertainties, lack of continued stimulus programs, the end of foreclosures and evictions moratorium, pent up sellers finally stepping off the fence to sell, and the future distress of more homeowners, the supply and demand pendulum will likely slowly start to swing the other way over time.  But, it will take time, and will not happen in the immediate future in my opinion.

The interest rates of many residential Fannie and Freddie loans (ARM's) as well as numerous types of commercial loans are based off LIBOR plus a spread.

Anyone have thoughts about the effects of the banking industry changing from LIBOR to SOFR?  Here's my 2 cents:

Suffice to say that this will effect a lot of mortgage for real estate investors. This doesn't mean that you should panic, and if you have questions, read your loan docs, and call your lender.

What's interesting to me is that this has been planned for a few years now, yet there's still some unknowns, questions, and uncertainties from many of the counterparties involved.

From what I can see, borrower's won't have too much of an effect as the banking sector is trying to not rock the boat too much, and rates should be comparable - it's just a different "measuring stick" that a couple dollars around the world are based on :)

SOFR is designed to be less manipulatable than LIBOR since it's based on transactions rather than expert bankers judgments (it's pretty crazy to think that $200 Trillion of financial service products around the world are based on "experts judgments.") Although a number of people are concerned that SOFR will be more volatile, there will be other indexes that certain banks and institutions use as an alternative index option.

Most loan docs over the last 3-5yrs had verbiage related to the potential change, and they gave guidance on what indexes would likely be used, the calculations for the new index, etc. The global economic committees that oversee all of this has also imposed fallback provisions that will cover older loans that didn't have specific verbiage too. 

The biggest challenge and problems will be with the banks and bankers that have to deal with switching over all these indexes. The amount of logistics, paperwork, and clerical work is enormous..... but I guess that's what they deserve for basing so much money on an index based on experts judgments.  

Let me know your thoughts and feedback! 

@Ryan Fox Our offices are in Bethlehem PA. We're a vertically integrated real estate company that owns and operates multifamily assets, we're a private bridge lender, and we're also the largest Realty Brokerage in regards to transaction volume in PA.  We know the Lehigh Valley very well, and it can be a great investors market.  Shoot me a message and I can connect you with one of our realtors who specialize in helping investors.  

@Account Closed

Yes, in the BRRRR model, your "refinance" will pay off the initial acquisition loan, renovation costs, and down payment, thus returning all of your initial capital invested. Ideally, the refinance gives you even more money back than you put in. Regardless, you then take the capital that you got back from the refinance, and look for more properties and "repeat."

The BRRRR model doesn't imply that you need to pay off the ending refinance and mortgage before you "repeat." Typically, the refinanced property keeps a mortgage on it and it's paid off through the term of the loan via amortization (likely 30yrs.) You can always make additional principal payments with the cash flow from the rental and more aggressively pay down the mortgage if that's best suited for your investing goals & strategy. With today low rates, it's not necessarily a bad thing to have a mortgage on the property, plus there's tax benefits.

As for cash flow.....yes, in the BRRRR model the plan is to make sure that your rented property pays for it's mortgage payment, taxes, insurance, and gives you additional cash flow on top of these expenses.

Hope this helps! 

Definitely make sure you stay focused on the premise of the BRRRR investment strategy, and also the last two "R's." The BRRRR model isn't necessarily designed so that you can own cash flowing assets free and clear, hence why the strategy has you "refinance" and have a loan on the property so that you can re-capitalize your initial equity, and "repeat" the process and buy more assets. You can certainly work to pay down the mortgage with your net cash flow, but this will take a number of years to do.

Skipgenie.com (best IMO)

ididata.com 

https://www.locateplus.com/

Batchskiptracing.com

Leadsherpa.com & Batchleads.io ( both are texting platforms that have pretty good skiptracing built in)

In the end, there's not a right or wrong answer as to "what's best?" when it comes to SFR vs MF (2-4units.) There's too many variables, and it all depends on what your personal and financial goals are.

But, the business plan, execution of the plan, and the operator (both you and the PM company) behind each respective investment strategy is the key!  In most scenario's you still have to manage the management company, to some degree.

If you have capital to deploy, then there's never a "bad" time to invest in real estate. Bad real estate investments predominantly are derived from poor business and investment plans on a deal level, and not so much due to the market.  

There are still great deals out there where you can make great returns with numerous strategies: flip; B.R.R.R.R.; buy and hold; buy and sell turnkey; etc.  If you have access to good deals, and you use prudence and diligence to analyze and execute on them, then now investing now is just as good as investing later.

With that said, it's always important to understand whats going on in the market. Many of the micro and macro economic factors are bleak, which will bode well for future distressed inventory and acquisition opportunities.  At the same time, the current supply and demand fundamentals create an environment for some great investment opportunities. 

Know your market, know your deal, and make good and diligent investing decisions.... and you'll always find a way to to drive profits and prosperity while investing in real estate!