All Forum Posts by: Peter Brown

Thanks Alex. I just PMed you.

@Dan Heuschele yes, they are fairly efficient. But they can't be perfectly efficient otherwise no true deals could ever be found!

@Cody L. Good point. This is basic finance that more expensive appreciating assets cash flow less and vice versa. The lower cap rates you see in the more expensive markets reflect both perceived lower risk higher upside due to expectation of stronger demand and rising rents.

My first deal was a duplex in a poorer neighborhood that cash flowed like mad...CoC returns 70-80% and up but higher risk and more management headaches over time. And more capex too as properties in poorer areas deteriorate faster. And years later the appreciation has been modest.

It really comes down to your time horizon and whether you want mostly cash or mostly appreciation.

@Marcos Gonzalez What are the usual terms for a DSCR loan, Marcos? And is the income based solely on projections or past actuals (assuming these are available at all)? Thanks

@John Acheson Hmmm. Can you explain this in more detail?

@Dan Beaulieu How do hard money loans work vs conventional, Dan? Thanks. I was looking at a deal recently that probably could not be financed conventionally. The cabin needed a well and septic. The lady had a septic plan and everything..The refi after these things were done would be no problem but i just didn't have enough cash to bring it down myself..thanks for your time.

@Emma Duncan interesting. How does the hard money lender allow you to scale faster? Because no money down and 100% financing for repairs? What kind of terms are you getting? How long and what rate does the hard money loan come with? Did they need to see a few successes under your belt to show you knew what you were doing in that particular asset class? Thanks in advance.

@Lara White what kind of properties do you buy? Was it hard to finance the first one?

@Alex Breshears This is precisely why my initial plan was to finance my first STR as a conventional loan for a vacation residence.

How many times can you do that though before you have to shift gears and go DSCR?

@Steven Wilson what do you do at the end of the 6 months? Is that enough seasoning to get a regular commercial bank loan?