All Forum Posts by: Robert N.

@Santiago Marquez I am looking for that tab you mentioned...I've been to the Network tab and clicked on Mortgage Lenders and have reached out to two of them thus far...final results not in yet. (Not sure if this is the place you are mentioning...so I will keep looking!) I'm not on FB.

I own an S-corp in a medical practice...been doing that almost 20 years. So, I am an owner BUT also an employee of my own company (so I do get a W-2). Another local lender stated that my dti ratio was not an issue...BUT they aren't sure about a loan on the new property under contract b/c the business on the first floor hasn't been established for 5 years. They should get me an answer in the next few days at least about cash out option on my original duplex purchase...but I'd like to have backup funding started in cash I hit a glitch. So, I am hoping for leads on who people are using for their lenders. 

I've had the property I want to cash out of since July, 2020. It was a BRRR. Just seems like others have done this without too much problems. I'd figure my regular job paying what it does would allow me to cash out no problem. I bought the property for $80,000 and put in a lot of work and money into it...and now it does cash flow nicely and looks great.

Hopefully the deal still works financially for you although the numbers might be lower than you expected. Making mistakes is part of the process of learning - and there is so much to learn! I view my mistakes as educational tuition on how I can make more money on the next deal. Not a single investor hasn't made mistakes...good luck and congratulations on doing what seems to be your first deal (even though you were kind of tricked into it). :) 

Hello BP,

I have listened and read many stories on BP of how people buy a property, fix it up, cash out and use the cash to buy the next - like a BRRR. However, I am having trouble which is frustrating. My income tax returns show that I make good money, so I thought this would not be an issue. I started with a local portfolio lender who said they would give me 80% of the appraisal value...I bought a duplex and fixed it up, rented it, and it appraised at $200,000. I had 100% equity in the deal. So, I went looking an found another investment property and put it under contract without having officially received my 80% ($160,000) cash out. I was flabbergasted that this portfolio lender then had me come in DAYS before I was set to close on the newer property and said he would only give me 25% ($50,000) - no reason...even after I pushed him for a reason. I had to sign to get my $50,000 loan so I could close on the new deal but I was not happy. I AM STILL HAVING TROUBLE finding a lender to give me 70-80% of the appraisal value on that first deal...part which would be used to pay off the $50,000 loan, but that should leave me with another $100,000ish which I plan on using on yet another property I just put under contract. So far, I am not having luck with my getting a cash out on my first deal and a loan for the new deal. I am in KY.

I am looking for lenders who will give me a cash out and a new loan for the property currently under contract (business on first floor with 2 apartments above it - all rented). What is the typical % rate and points I can expect to pay on these things. This will be my fourth property since I started investing in July, 2020 - so I am still learning lots! Thanks! (Worse case scenario, I have to sell my original duplex, do a 1031 exchange to get all my money out of it - but that isn't my plan! I want to buy and hold.) Any help is appreciated!!!

Ken,

I think it is a glitch...at first I thought maybe I was not changing the tab from annual to monthly, BUT after doing this so many times (Calculator Grandmaster) I think that it often "forgets" that I made the switch. So, if I put in $80/month for insurance for instance, the BP calculator changes it to $80/annual ($80/12 = $6.67) and my analysis are all off. So now I am in the habit of double checking each report before believing what it says for my CoC return and Cash Flow.

Welcome! I am investing in Lexington and the surrounding areas.

Hello BP community! I have run into an issue after I thought I did every thing correctly.

Here is what I did (my homework):

1.Called MANY banks and finally finding one locally who would do a portfolio loan/refinance for me.

2. Was told I could pull 80% out of the equity on a duplex I own (I didn't have a loan on this one, so I was 100% equity).

I thought - great! Now I can reinvest this money into other properties.

Problem:

The banker was slow in doing paperwork and I kept on him (like asking him many times to send an appraiser out, etc...I was polite but straightforward). I finally had to ask the bank for a different loan officer...but all that happened was it got kicked back to the original guy with him apologizing to me for his tardiness. I am new in this business, so I thought we would move on from there with this loan - no problem.

Now I am closing on March 5th on another duplex and need that down payment money being pulled from my first/original duplex...but here in the last minute, instead of the loan officer giving me 80% of my equity, he won't do it...now it is less than 25% and he says it needs to be a home equity line of credit. He is now "concerned" about my debt to income ratio (he has had my tax records, credit report, etc. for a while). The good news is that this lower amount is still enough (barely) to help me cover the cost of the closing, but I have a lot of equity still in the original duplex I would like to have access to invest in more real estate.

I don't want to mess up my closing on March 5th so I plan on signing the paperwork for this home equity line of credit today. I am asking for any suggestions as to how to get the rest of my equity out (and maybe a way to pay off this home equity line of credit with this current bank) is appreciated. I know there will be even more fees if I close this line of credit out early (within the first one or two years) but I'd like to move on and write off the extra expenses (closing costs/early repayment fees) as a learning experience. I believe if I was to take out more money from this property from another lender, and if the original lender found out, they could ask that their loan be repaid in full immediately.) Yep, I feel like I've been played...as I am new to this business, I have a lot of learning to do and looking forward to finding better ways of doing business in the future. Thank you for any advice.

Thank you everybody and @Joe Splitrock for going the whole mile in educating me on this. This has been very helpful indeed and I never expected so many wonderful replies. :-)

Now I understand much better the whole loan process and why most banks won’t loan on such a small loan amounts. It does not really make sense to get a loan on such a small loan amount (in this scenario at least). 

I talked with my local banker where I live and he's agreed to do a HELOC on my private residence so that I can then pay cash for the property in Ohio.

But if it was not for the HELOC being available, I would have used this loan (and not have felt so bad about it since some of the costs are incurred whether you have a loan or not). However, now I also know that some of these fees are negotiable and I might be able to get better terms by shopping around more. This was the fifth bank I had talked to about getting this loan and they were the only ones who would do it.

I am set to close on February 25. And looking forward to the next step of being a landlord! I do have property management in place. :-)

@Zeke Liston and @Kareem Johnson

Loandepot Is the place I use. It was given to me by my real estate agent. Here is the link to the agents info in Mansfield Ohio 

https://www.loandepot.com/loan...