All Forum Posts by: Ryan Herting

Hi BP Family, 

I just got finished listening to episode EP 462 of the Bigger Pockets podcast featuring Terrance Doyle. If you don't know his story or who he is I recommend checking him out and listening to this episode. I won't give away too much of the episode, but a  HUGE takeaway was about where you should invest. 

Specifically, the episode dives deep into the question of where you should invest, and covers the age-old notion that "you should buy when everyone is selling and you should sell when everyone is buying." Altho this is a great concept, for many, it deters them from investing when their market or neighborhood is hot. Especially for new investors, this can be a real challenge emotionally and monetarily if they live within a hot market and they want to start investing. 

What Doyle really drove home is, no matter how hot the market is if you know the area very well and have eyes and ears on the ground, success is more likely. Moreover, success is more likely for reasons like you can manage the project and its details, you have insight into the wants and needs of your end buyer, and most importantly, you have those relationships in the area.

SO.... MY QUESTION FOR YOU BP FAM, WHAT ARE YOUR THOUGHTS ON INVESTING WHERE YOU KNOW/LIVE OVER TOP PERFORMING MARKETS?

@Account Closed,

I see what you mean. I believe the macro effects will be minimal because of their business model and the product they are offering. To elaborate, although the product itself is similar to timeshares, the structures themselves are not usually multi-unit complexes, they are SFH homes that people/their company looks to acquire. Additionally, it's a new concept, so it will take some time for the market to adopt this notion. I believe it will be some time before many Pacaso homes saturate a neighborhood.

I will look into this more for you because this is something I would love to learn more about.

Hey @Hunter Jones,

Due to changes in Fannie/Freddie guidelines as it relates to second homes and rentals, pricing will be in this range. As banks vacate the scattered residential market it leaves limited options for financing this property. That is actually a great rate for where the market is currently. It's a strong side-by-side comparison to what banks were offering to borrowers. Which was 5/1, 10/1 arm, 20 or 25-year amortization. Keep up the good work and let us know if we can help. Depending on LTV, and FICO you might get closer to 4.5% currently.

Hi @Frank Rizzo,What is the goal of the HELOC, too acquire more rentals? If so that is going to be hard with DTI currently. No bank will touch him, he needs to look at hard money or private money to build a portfolio. Let me know if you want to chat further about this.

Hi @Bryant Payne,

I would agree with the large majority to focus on LTR, unless your area is a "Hot Zone" for STR. The BRRR strategy is definitely a book I would recommend reading. Also listen to BPs podcast on BRRR

Real Estate is a way to financial freedom, but the reality of it is it will take time. I would recommend staying in ur current job while you are starting your investing journey. 

I know there are many opportunities out there when it comes to REI, but FOCUS on what you know best. This will make the investing process easier and give you more confidence to keep going.

Hope this helps!

Hey @Account Closed,

recently been getting a bunch of ads for this timeshare/Airbnb/investment opportunity called Pacaso. I'm still doing more research into their product, but from what I know so far, I think they really carved out a new kind of real estate investment verticle. The Co-founder of the company was actually the co-founder and CEO of Zillow. I'm more curious about this product than against it. 

As for other homeowners not being thrilled about timeshares entering their neighborhoods. From what I know, ownership works like shares and it can be broken down from 1/2 to 1/8, so turnover isn't as equivalent as a regular timeshare or Airbnbs. Also, these homes aren't concentrated currently in one location.  

Again, I need to do more research, but heck, people thought Airbnb wouldn't work. If you have more information as well and thoughts, would love to hear yours. 

Hi @Allen McGlashing,

I would recommend using a private lender. They can usually do 85% LTC. Is the current debt owed currently 80% of the value? Or are you seeking 80% cash out? Let me know if you would like help with this.

Hey @Virginia Radcliff,

If the goal is to do more projects then yes, pull the cash out now while rates are at all-time lows. If there is no need to pull cash and do more deals, then do a rate and term refi for a lower rate.

Hope that helps!

Hey @Tyler Williams,

2-4 units are viewed as higher-risk loans on the capital markets. Usually .25-.50 bps more expensive than SFR.

Hey Lucas, 

Some companies had to tighten their loan offerings due to covid. Thankfully our team has kept strong through it. To answer your question, 75% LTV is the norm. There might be a couple of lenders offering 80%, but there are probably far and few.