All Forum Posts by: Ray Thorsen

I am shopping around to cash out refi 3 duplexes in Southeast Wisconsin Racine county that are in my name. My current bank is not writing on investments currently. Does anyone have a lender they used recently and would you mind sharing your rate and fees/points. I have one quote for  3.625 interest and $6500 in points/loan level adjustment plus all the other fees for a total of 8600 in fees for a 262000 loan. Reading the forums it seems other people are getting much better deals in other states but I did not see anyone in Wisconsin. I would be willing to travel in the surrounding areas if need be Waukesha. Milwaukee, Racine, Kenosha. Any help would be greatly appreciated.

Thanks

Someone who understands they are helping me find my next investment and not selling me a house.

We are also using Cozy for 14 units. We have been for over a year now. The biggest down side is the wait for the ACH to process.4 to 8 days has been our experience.  But it has made it 100 times easier to collect late fees because it automatically shows up in there account similar to there credit card bill if they are late. We also like the maintenance call tracking. 

I am looking for suggestions on the best way to fund purchasing a property at a sheriff sale using a free and clear property as collateral. I was going to traditionally cash out refi it but I would need the cash in about 25 days so I am unsure I can go that route do to timing. I am looking at Hard Money lenders but was hoping for ideas that were a little more cost effective. 

These are before and after I replaced doors in one of my units. It was a night and day transformation i thought. Cost $1200 plus hardware. duration 3 weeks to order I think and 1 day to install.

@Lucas Carl thanks for the tip. That opens up more opportunity for me. 

@Luke Carl When you say 10% down I assume you are talking about mortgage down payment. Is that true? if so at what rate and terms? Is it a local bank or a special loan for STR properties.

For my C+ to B+ properties I paint flat on the ceilings, satin on walls, except kitchen and baths we use semigloss. I have the same  painter and same paint colors for every unit. So I just call my painter and tell him the address and if it is a complete repaint or partial and he knows what to do and what to buy. He is a Sherwin Williams guy and he feels its the best. There are cheaper paints but then I would have to deal with my painter if it didn't cover as good as it should. This way he quotes me a price and he is done when all the rooms are covered correctly whether he needed to use one coat or 3. It is usually 1 or 2. He also is a professional so he uses primer when needed and knows how to edge and tape so the wood work still looks like wood when he leaves.  As for what color we have been using a light tan my wife picked out years ago. The trend seems to be moving to gray but then I would have to repaint entire units every turn so I think we will stick with our color. 

First off the 1% rule is a rule of thumb. Everyone may interpret it differently. My understanding is 1% of the all in price. Meaning 100k purchase and it needs 10k in improvements to be rent ready then the rent needs to be 1100 mo. to meet my interpretation of this rule of thumb. Keep in mind this is usually just an indicator if the property is worth looking at. So if rent comps were 1100 and the list price was 140k I would not look at it based on this rule of thumb. You still need to run the numbers even if you find a 1% property. Property taxes, hoa dues, utilities (if paid by landlord) will easily put a 1% property deep into the red. Property taxes in my neck of the woods are high so I usually adjust the rule of thumb to 1.2 or 1.3 before I may become interested.

I am looking for options on how to structure a loan from friends and family. I would use the loan for dp funding to buy a couple duplexes. I do not "need" the money to qualify meaning I can cover the DP amounts but it would free up my capital to purchase more. My lender is looking for a 5 year term with no interest or payments do until the 5 yr mark. He originally wanted just a promisary note but I wanted to give him a second lien position on a building I already own with plenty of equity and no desire to refinance. The same protection I would expect from any other lender. The questions came up about me being able to deduct the interest. Can I do that even though I am not paying it every year? On the flip side does he need to claim the interest income each year? Or could we structure it to where he gets a fixed profit at the end of the 5 years without him being an equity holder? He wants to stay on the fixed income side. Would that be long term capital gains at that point?  It would most likely end my chance at deducting the interest but if I am not paying it every year what does it matter to me?