All Forum Posts by: Nicholas Lohr

I'm in the midst of a huge BRRRR deal and the loan and title are currently in my name. I had investors put in the money for the rehab.

When it comes time to refinance how can I keep them out of the loan process?  

How can they not be on the loan yet still have equity ownership in the property?

How to syndicators with 10-20 investors in a deal keep those investors separate from the financing part?

Just FYI that would make the opportunity zone part irrelevant. In order to get the benefit of the opportunity zone you have to do a major renovation / new construction project on the property. 

I just turned a 4-plex into a 6-plex by building 2 more units in the back of a parcel.

It took 2.5 years start to finish and the price was $250 per square foot. And that was me being the GC. It was a TON of work. The permit process and stacks of paper I had to deal with was really something. 

I NEVER should have done it. Spending 2.5 years to build a duplex is too long.  Think about the time value of money. 

I banged out a 6-plex remodel in literally less a quarter amount of of that time. 6 months.

The new construction thing should really be thrown into the "too hard pile" in my opinion unless you are building something really big or really know what you are doing. 

Does anybody rent these to cannabis based businesses?  

They are becoming a very hot item in my area these days.  I'm starting to hear some chatter about a shortage. And with the passage of the farm bill and the legalization of hemp I can see a huge demand coming.  Hemp takes up a ton of space. 
 

I bought a 6 unit in West Sacramento  (West of Jefferson Blvd) which is one of the least desirable areas in the Sacramento area and I had each unit listed for only about 3-4 days before I found qualified tenants no problem.  My qualifications are 650 min credit score, a clean record, and income of at least 3 times the rent. 

I did renovate each unit to make them look nice though. 

For commercial multi-family buildings (5 units and up)

Oh interesting. That could make sense actually. I wonder where the break even point would be where the closing cost of the conventional loan outweigh the higher interest rate of the hard money loan.  I suppose you have to do the math and figure it on a case by case basis. 

I think either way I still prefer the "sleep at night" feeling of going the conventional way even if it is more expensive.  

What if the market shifts during the the rehab phase and you can't refinance? What if you have trouble renting it out and it takes a long time? What if the rehab goes way longer than expected? What if something happens to your personal financial situation and the bank won't approve your refi loan? etc...

I like the feeling of knowing that if something (anything) comes up and I can't refi then I'll still be ok because I have the original 30 year fixed.  

I think you may have it backwards?  Usually the hard money loan will have a higher interest rate than the conventional loan so the hard money will be more expensive during the initial holding phase. 

As far as conventional loans being "lazy" I'm unsure what was meant by that. 

So frustrating right?! 

I just went through this in CA with a 3 day pay or quit notice. They just straight up ignored it!  

On the 7th day they finally vacated.  What I did was I texted them the exact date I had scheduled with the eviction attorney and a final plea that it's best for everyone that they vacate by the day before that appointment.  I think I said something like, "If you vacate by (date) then I can cancel my appointment with the lawyer.  By doing that we can avoid the painful eviction process, it can be a clean break, and you will avoid having an eviction on your record."   I think I may have mentioned how difficult it will be to get housing with an eviction on the record. 

Once it started moving in the direction of the "official" 3rd party getting involved (the lawyer) they got more motivated. 

Good luck. 

Got you.  It's probably best for you to contact a lawyer then, especially before you let more deals fall through because of this.  Unless someone else can chime in here.  I do get the feeling that you shouldn't be loosing deals because of this. I'll also say that I've done 4 deals in CA and I have friends who have also done a number of deals in CA and this has never come up before.