All Forum Posts by: Pete Schmidt

Looking for investor / partner to work on some bigger projects.  Currently I have 8 rentals, all producing good cash flow.  Also own a property management business (I have a property managers license), and a services business which does everything from landscape up to complete gut remodels. Both businesses are licensed, insured, and have workers comp for the 4 employees on payroll.  Other than HVAC and roofing we do all work (have excellent subs for those).  I'm currently managing 20 properties for other people and have excellent reviews from customers and owners. My first investment property started in 2007 and official start of the management business "J&P Unlimited Inc" was formed in 2013. This has all been done part time while working my full time law enforcement job. I believe it about time for me move on to bigger and better.  Need to find something for me to transition into and what better than what I have spent the last several years laying the foundation for. Looking for some type of investor that knows what has to be done to make finding and financing go smoothly.  The small amount of cash I can provide, will be made up in my knowledge of the area, rental market, and providing the crew to remodel, repair, and rent/flip the property. 

I appreciate the advice and that makes sense.  This property has been such a pain when it comes to financing (but guess that’s why I got such a good deal and no one else was able or wanted to get involved). After speaking to more lenders it does not sound like it will ever get easier due to the trailers. So basically I think I may just hammer down the payment and get it paid as quick as I can then enjoy the $6k cash flow a month.  The next one I pick up will be a multi family all in the same building or all trailers without a structure, not a hybrid like this one.   

How would one go about establishing the value of an abnormal property?  Being new to this scene im not sure how anyone would go about coming up with the value of it. Last year I purchased this 1 acre with a 2000 sqft brick house and 6 mobile homes for $150k (owner financed after I put $30k down). It was very run down and only 3 trailers rented. I put $150k into it with repairs from personal funds as well as through 0% credit cards. Im going through the process to refi now and was just going to get the loan to pay off the seller ($105k) and $50k worth of materials financed. This of course leaves $100k of personal money tied up in it. Reading more on BP it looks like I should try to cash out my personal funds so when the next comes along I can have it on hand to buy and repeat. As of today the property is pulling in $4750 a month and will be closer to $6000 after I finish the reno on the last unrented unit. Problem is finding anything close to be able to comp it with. Most of the mobile home parks that have 6-7 units are beat up and run down. 3 of mine are newer with all new appliances, hvac, floors, walls, roof, ect. The house was gutted and remodeled with granite, tile, wood, ss appliances, ect.  Anyone have any ideas to break this down so the bank does not compare it with some run down park and say the value is not there or its too risky?

Im pulling $60k year now from rent.  Next year will be just over $70k (I will have the last place remodeled and a few of them will have the rent increasing).  

I appreciate the feedback guys.   Not having delt with this before, I was not sure if this was the norm or not.  Sounds like it is, so thanks again.  

How deep do banks normally dig for commercial realestate loans? Here is my situation. Full time I work for the State Police, have a property managers license and Mgmt bness where I manage 20 homes owned by others as well as 1 that I own. I purchased an acre of land in an LLC being partners with my mom (she put the down payment down and I handle the rest). Purchased the property for $150,000 owner financed, and put $30,000 down (no bank would loan to me because it had 2000 sqft brick house and 6 mobile homes on the same partial of land (and they were all trashed). I spend about $50k in materials/repairs and have 6 of the 7 properties rented for the last year. 7th will be done next month. As of now it's pulling in $60,000 a year. I have purchased all the materials with store financeing and credit cards that have 0% interest for 18 months or better. I have been knocking them down quickly but does not leave much for cash flow. Figured if I could take out a loan for $155,000 I could pay off the mortgage, and every credit card Or loan associated with this property. Doing so though they want my personal taxes and finances, my property Mgmt finances, I have a repair/construction bness as well a graphic printing bness. They said they need along of those too. Though It seamed like a bit much since the house aloneness covers the mortgage and then some, I turned it in. (My credit is great and other bness are profiting. Now they want to see my moms last 2 years for taxes. Is this the normal procedure for a commercial loan or they just jerking me around here? Seems a bit excessive considering the value of the property and what its pulling in vs what I'm asking for.