All Forum Posts by: TJ P.

I see there is still no good answer to the OPs question. I'll add my experience and am reaching out to see if anyone has a real solution. 

Like a lot of us on here I have many rentals (some free and clear and some with mortgages) that I picked up in the crash years. I haven't purchased a property in 3 years. Why? The deals are gone and the financing options only make sense if you can find a deal. I'm sick of hearing about this bank or that portfolio lender only to find out that, oh yeah, interest rate is above 6% or the ammortization is 10 years or, sure, you can refinance all your properties and take out 75% of LTV...but the "value" isn't anywhere near what it should be after their "conditions" are accounted for so you get to jump through a bunch of hoops, pay a boat load of fees, end up with a higher interest rate and pull out a miniscule amount of your equity (looking at you B2R and private banking at Wells Fargo).

No thanks!

I'm looking for a bank that is willing to lend me money at 5% or below interest with a 10 to 30 year ammortization without a restriction on number of loans. If I can find an okay deal that cash flows at those numbers then I don't see why these lenders don't exist?? I'm even willing to put down 20% on every deal.

Maybe I'm mistaken and please someone point it out to me if I am, but I have not been able to find a lender who will give me a loan at 5% or under, 15 to 30 year ammo, 20% down, to a guy who has 10 loans already but has good credit and can show a good income outside of the rentals. Because, like a lot you, I'd love to be able to buy more. Even though my city has become difficult to find good deals, there are still a few decent places in this Country to buy rentals.

So for now, until I find that unicorn lender, I'm going to start buying with cash again.

@Max Dicce

@Leo Blandon

@John Smith

@Jhana Cayton

@Tzvi Ausubel

@Shane M.

@Paul Doherty

@Lacey N.

@Umer M. Chaudhry

@Mikki McIntyre

@Cecilia Arnulphi

Alright, Think I have everyone tagged who asked questions. Sorry my phone is exploding with responses and I appreciate all of you saying such kind words and encouragement. Ill try to answer everyones questions as best as I can but don't get mad if I forget to answer 1 or 2!

How I got money:

I purchased my primary in Seattle in Aug 2012 for $395k put 20% down on this.  Just recently refi'd at 600k and pulled out 100k for investing.  Paired this with some of my other properties cash flow reserves  I have saved. I was looking to buy apartment complex but realized I would have to invest a lot of time into doing this.  I run a insurance agency and this requires a lot of my time to do so I didn't want to spend a ton of time on this but wanted more returns that stock market. Thus TK emerged as my front runner.

Lender:

So to answer your questions on leverage. I put 25% down on each property and use the lender Talmer Bank (shawnhuss.com) to get my deals done.  Simple and close on time. 

You use all the typical process on closing (appraisal, inspection, etc.)

My loans are all locked for 30 year fixed at 4.35-5% interest.  Payments are anywhere from $275-$500 a month depending on the insurance and the prop taxes.  (this is where cash flow comes in)

Turn-key provider:

Like I said prior I use @Sean Tarpenning with USREEB.  I have done majority of my deals with him and his great team.  They do everything from screening tenant to rehab.  Its full service deal so they take car of everything which is what I was wanting. I don't have time to rehab, find tenant, etc... and for how much extra are you really making on this?  Time is money and I would rather find more deals than find a  tenant etc...

You can go on their website to check out their inventory or just get in Touch with Mackaylee Beach, which is USREEB sales dept. PM me if you want her direct info.  

Properties:

I stuck with all "B" neighborhoods with 2 year leases in place.  I went out to look at the neighborhoods to see difference from "B" to "C" too see what my comfort level was.  To be honest, there is nothing wrong with a C either its just felt 100% confident with a B.   

All properties are off the MLS and direct through USREEB.

Properties range from 50k-85k on ones I have purchased. 

My 2 cents:

This is way to go for any person who doesn't have the time to do REI full time. My thought process is all income is good income. So for all those people that asked me about cap gains, taxes etc. Thats a good problem to have! New problems are good problems. If you don't have new problems in your life then you aren't growing. This is why I wanted to try to close 10 of these TK's in 6 months and why I will have 25 before end of 2017.

For me SFR's are great because I haven't found a deal (i'm sure they are out there) that gets me better cash flow on MFRs. If you have some PM me :) Also SFR's you can sell to a regular home buyer whereas MF you can't. I liked having the option for "oh sh*t I need to sell this now." You are cutting out 50% of your options for exit strategy for me with MF.

Plan is to use the cash flow from all properties to pay off 1 property at a time. 40k a year will pay off 1 loan after 12 months not including any of my savings from my personal income or other 4 plex I have.  I plan to have all these paid off in next 4 years while adding another 15 through leverage.  Who knows though, things can change and I just need to be ready to change with them.

*****Thanks again for all your notice and such kind words. I truly wouldn't have had a shot without BP so thank you!  Let me know if you have any other questions and I will try to answer******

P.S sorry if I misspelled anything. I don't edit. I just post.

To be clear, I'm not predicting apocalypse, but I am predicting a 20% or so decrease from here. I think it's semantics if we want to call that a crash or a correction.

So, we obtained a rental through inheritance, (would rather have Mom), but as she passed we decided to not sell the place and keep it as a rental here in Cali.

@Kris Langford @Steve Moody I am just south of you in Eugene, and after years of spinning my wheels trying to invest buy and hold locally, I never pulled the trigger.  I finally got started  in 2012 by going with a turnkey company out of state - Florida actually, and out of state investing is still all I do.  I've always been focused on the cash flow, not the speculation.  My turnkey properties have performed well, and there has been substantial appreciation as a bonus.  It's not for everyone, and you have to be careful about who you work with.

@J.Martin

I would love to see if I can speak at this event.  I noticed a lot of investors are interested in conventional financing but aren't sure if they qualify etc.