All Forum Posts by: O'brian R.

I'm really enjoying this thread. Thank you for taking the time to share the details of all your past deals. It's helpful for us new investors who are just starting out. 

I'm curious though, could you share a bit on how you found your team? 

I had heard this from my lender as well. Too bad since HP financing at 10% is amazing and how I got my first property. Hope to pick a couple more before October.

You can put down 10% on a SFH with Homepath even as an investor. I did this for my first property. Though with Homepath foreclosures that are larger than 1 unit, such as a duplex, my lender was requiring at least 20%. All banks don't do Homepath loans, but you can call around and ask or look through their site for qualified lenders (https://www.homepath.com/)

I'm wondering if there are any issues with financing a property under my name and have myself on title only, but have the down payment funds come from my spouse's bank account. My wife and I have a long term plan to each finance 10 properties which is why we don't want to both be on title for each purchase.  I'm just curious as to whether we'll be required to put my wife's name under title because the down payment funds will come from her account. I suppose an easy fix would be to add myself as joint owner to her bank account (which she wouldn't mind). Thoughts?

I second The Millionaire Real Estate Investor by Keller - this one is good for establishing the the big "why" you want to invest and mapping out what your end goals are so that you get started right.

Also What Every Real Estate Investor Needs to Know About Cash Flow by Gallinelli - if your a numbers person, this one is for you. Even if you're not big into numbers, this book is essential as it lays out all the different financial terms you see thrown out on BP such as cash-on-cash return, NOI, cap rates, GRM, etc. After reading this book along with learning about the 50% rule on BP, I felt like l could analyze any deal.

@Will F. I know this was an old post, but I'm looking into doing something similar. Did you end up going with National Family mortgage or just do the NOLO form?

Would have loved to attend, but will be out of town for Mother's Day. Sat night could work though. Have fun!

Care to share with me which turnkey operator your investor was working with?

The most common incentive for turnkey providers that I seem to always hear is the opportunity for future business with investors who are happy with their current turnkey purchase. Maybe this is what you're implying, but if not, could you explain what financial incentive turnkey providers have after the sale of their properties that you're referring to?

I think that applying the conservative estimates of 50-60% of rents toward expenses as @Jay Hinrichs recommends is a very smart way to secure your investment long term. My hunch is that you may likely be overestimating your expenses considerably for the first few years assuming 50%, but in the long run you'd be happier that you did once the rehabbed property begins to age and experience unexpected issues (i.e. bad tenants, repairs, etc).

Often the pro-forma sheets I've seen from turnkeys will state very low yearly maintenance estimates (~5% of rent) and total expenses may only be 30% since they are newly rehabbed. These assumptions will make the properties look awesome in terms of cash-on-cash return and monthly cash flow. Problem is if you're buying a long term (30 year) investment, I think it'd be wise to at least run the numbers not using the lowest possible expenses (i.e. 1st year after purchase of rehabbed property), but some estimate of what the average expense may be over 30 years. Could this be 30%...maybe. But based on the collective experience of investors here on BP, it certainly seems that people experience closer to 50%.

I grew up in the OC, live in LA now, and I'm also new. So like you I'm interested in out of state and also interested in turnkeys. I think the cons mentioned by @Jon Holdman highlight some my biggest concerns.

As for fees, they are definitely going to vary depending on who you're talking to and what area you're considering. Though I've seen slightly lower PM fees through turnkeys than what you'd get for hiring a PM on your own.