All Forum Posts by: Ryan McGlasson

@Derek Tellier  Thank you for the recommendation, I really appreciate it!

@Parker Borofsky  Hello! Just sent a connect and a message, I would love to chat with you further.

Hello all! I am beginning to team build in the Knoxville area, specifically for west knoxville, and I would appreciate if someone could recommend a great mortgage broker or a great general contractor.   

I have been looking through the forums posts in the past regarding the topic and I have seen a few times people asking for similar team members but for much different uses so I figured I would ask.

@Chris Tracy Thanks for the reply. Of course! They also need to see I am a fit for them and vice versa.      I agree, I was thinking it would be a wise decision especially with brokers but as you pointed out it would be a good idea to separate myself with a property manager too because of the possibility of another deal source. I appreciate the help.

Quick question I was thinking to myself but I really wanted others opinions on the matter. 

Currently I am team building out of state in the market I am planning to invest in, I know of course flying out to meet brokers is a must but, is this also true for property managers? Not entirely sure if flying out specifically for property managers would be too much assuming one can successfully interview management firms over the phone with a call or two rather than needing to in person.  

Is it wise to fly out to meet with potential property managers for just as you would to meet with brokers? Or phone interview them and meet with the one you have chosen when you're in the area?

Thanks in advance everyone!

I found this thread to be full of great advice although some conflicting. But generally I think everyone can agree no one should start with a 150+unit syndication. In my opinion if you were to want to do a syndication to start getting into real estate investing realistically you would not want anything more than 28 units. I agree with Brad Sumrok in saying that you should not just not go for it based or fear or inexperience, BUT you NEED to consider that it is not your money and that you must be knowledgeable to where there are no surprises.   It is a useful thing to have these kinds of threads to keep peoples expectations grounded sometimes.

@Bill F. I also agree it would make it much easier to start up with an LLC for the stated reasons.

Going off of what Michael Le said earlier and relating it to what you have stated I think I have gotten a better picture but correct me if I am wrong. If the investor has no decision making capabilities in the partnership it needs to be a SEC and if the investor has the ability to make decisions it can be formed as an LLC. If this is true then the LLC you suggest would suffice for this type of arrangement I assume.

The family investor I am referring to does have successful experience with renting one SFH and selling. If that would be a positive benefactor.

@Brian Adams   Thanks! I have been following your posts before but I must have missed this one. Really great breakdown in the article that I will study further. 

@Todd Dexheimer   I have heard of that book a lot, will look into it. If the family relationship does not matter to save it from an SEC I would still then need an SEC even if the only investor was a family member? They will be a passive investor but with majority equity. 

If raising 500k would not be effective, is this meant that its too small of an amount to raise or too large? 

The downpayment alone would be 350k , are the mortgage origination fees and the closing expenses part of the loan on top of the 350k? Or is the loan just for the downpayment?

Thank you for breaking down the costs associated, really gives me a better overal idea of the capitol needed. 

The best option would be to raise around 450k capital for the downpayment, closing and mortgage origination fee and also for the renovations correct?  I would assume the inspection fees,phase 1, survey fee and other fees would come out of my pocket to make the deal happen?

That will be the goal, loan sponsor and more ownership to them because of signing the loan. I really appreciate the articles as well they are extremely detailed and helpful.  

Question for you, from one article you state it is not a great idea to invest with just a partner or to use your own cash instead, but the next article states that it is acceptable to raise money from a partner so long as you are concerned about how the cash is treated and have the 6 listed questions answered so you are wise with the investment. 

Of course It is not a good idea to ask anyone for funding when you do not know what you are doing, which is why I would not try to sell myself to an investor yet, but is it still a silly idea to invest with a single partner if I were to take a mentorship course and really learn every detail of a deal? Of course I will not know everything but I will have a solid foundation to move on from, would it be a generally bad idea to still attempt to raise the capital and go for it? 

I read many stories/posts of people starting from my standing point of no liquidity or net worth then bringing on an equity partner to make the deal happen, many people say its a bad idea to try without the experience and you should go for it if you have the understanding on how to make it work.  Thanks again!

@Michael Le   Thank you for the additional information, most likely I would go the SEC route for the purpose of bringing on another member besides the initial investor.

@Dan Handford I appreciate the detailed breakdown of what is involved with each, I could see what @Bill F. Was saying but it was further clarification. How exactly does partnering with a more experienced syndicator work in this manner?  My question is vague, but I do mean in the relation with the original syndicator how does that work out?

@Dan Handford    Very true I will need another. I will keep that in mind as well to consider for the total amount. In your opinion what is a great way to learn the details of how these loans are underwritten? Specific guides on biggerpockets?Also with your reply to Juan Vargas, my deal would be a smaller unit for about 20 units. With a great local management team they could possibly sign the loan even if the sponsor does not have experience?

@Bill F. Just asking general questions to see if its an option worth or possible to pursue. It would depend on the total of the capital needed for the purchase if I would need to bring on another investor outside of family. But I see for two members in a family a LLC is much simpler.

That is a fair question I will receive a lot, of course we all have to start from somewhere. I believe if I find a deal that gives a great ROI for investors, the numbers they can view themselves should give more credibility to the deal than I can with my personal experience so far. But I do agree with the concern of the question of course, which leads me to asking the details of whats needed to accomplish this style of deal, which I am coming more to realize It would be a wise idea, as Dan Handford mentioned, I would need to partner with an experienced syndicator (preferably from here)for my first deal.

@Juan Vargas That is exactly it, I would prefer a larger debt if it means the loan can be non recourse.

@Juan Vargas

Thank you for the help! I would imagine at the time I am ready to bring a deal I am knowledgeable about how to close it with meeting lender requirements,by either observing an experienced syndicator/having a mentor. With that in mind my contribution would not only be the deal, but the time and knowledge to close the deal. But of course it may not be seen as much of a contribution since I do not have hands on experience.  Just need to close that first deal.

A track record with multifamily no, just one successful SFH rental. No non-recourse loan experience.

They do have the liquidity, and I believe the net worth. I am not sure how the net worth would be calculated to relate to the property although.

For a proven track record, of course new investors do not have one which is a set back. Does every lender look at experience of related deals to the loan? Or is the concern mostly if they have the liquidity or net worth? I ask because I read that people have gotten these loans (on themselves) with using package deals and marketing plans for the lender to show how exactly the property will make money, all this done with no experience, only the net worth and liquidity. 

@Robert Borr    Thank you for the quick breakdown of the terms and how they relate, quickly cleared up my misunderstanding.  Relating to what Juan Vargas touched on this would most likely make me a co-sponsor correct?

The due diligence will be a major focus for me when putting together and seeing through the deal. I do understand that I will need to pay for the legal fees and the SEC lawyer to put the paperwork together and I have no issue with using my own funds to allow myself to properly raise capitol for the investment to have the correct starting pieces.