All Forum Posts by: Sam W.

George Paiva,

LLPAs are Fannie Mae's method of accounting for risk...its a culmulative amount based on property type, credit score and LTV (might be something else...can't remember). I think it starts out at something like 1% for investment property...add X% for different levels of credit scores...and add X% more for different levels of LTV.

I think (but am not 100% sure) that the LLPA isn't applied as a closing cost (fee or otherwise). I think that it is rolled into a higher mortgage rate...but will defer to the experts.

Sam

Godess Clemons,

Welcome to BP. There are a few of us from your neck of the woods here.

I'm sure there are many attorneys in the area, but you might look at:

Justin C. Miller, Esq.
3443 Medina Road, ste 101-E
Medina, OH 44256
(330) 952-1780 Phone

Disclosure: I have no business affiliation with Mr. Miller and receive no incentive to recommend him (other than I think he does good work).

Good luck.

Sam

David T. / Muriel Brannon,

I don't know about Mr. Barazandeh's program, but I will wager you can find many of the answers to your questions here on BP. I'm not a Texas tax sale expert, but I'm fairly confident there are a few "hanging around" BP who would be happy to answer your questions...for free!

While this gets into the soft, squishy world of trying to predict the future, in my opinion it is very important for REIs to understand the dynamics of the market and position themselves propertly...just as it is important for stock and bond investors to do the same...or those who invest in rare coins.

First, institutional money is driving up prices in certain markets. That is by design. Just as with other commodities, institutions provide the environment for rapid appreciation: scarcity and demand....then they allow private investors to take it from there. In reality, the hedge funds just jump-started the train - private investors like us are driving it by jumping on anything with 4 walls and an address. I'm amazed when I read some posts about 20-30 bids on a property and it selling within days (hours) of it being on the market. This isn't the hedge funds .... this is individual investors jumping on the train because they are afraid of being left behind (and the funds are loving it).

In my mind, the savvy investor positions his/her self by following the rules and not being distracted by the shiny objects. If you are a buy and hold investor, stick to your metrics. If you subscribe to the 50% rule (as I do) use it religiously (or the 40% rule...or 61.5% rule...or whatever works for you). Don't feel compelled to make a bad decision because you think the train is leaving the station. Maybe that's one ride you don't want to take.

Last thought...and this is strickly a gross over-generalization...but it seems that some areas of the country make it very difficult to employ certain strategies based on prices, the market, and completition. You might have to look other places. Granted, some folks are so good and smart that they can make money anywhere. But for most of us smucks, I think the less travelled road is pretty attractive right now.

I have the same experience in NE Ohio as Justin Silverio does in Boston....$1950/year vacant vs. $1099/year occupied. This is for a 3-family. By the way, for a MF, my insurance company considers the property occupied if one unit is occupied.

Christopher Boggs,

You're paying about the best rate here in our area....another place to look at for comparison is Alside Supply on Poe Rd in Akron. Won't be much different in price though.

I've never listed on anything but Craigslist...very popular in my area.

I have a vacancy right now. Lots of action on Craigslist. As a science experiment I'll post it on a few of the other sites mentioned here and let everyone know the response. Of course, will only give insights into the use of these sites in NE Ohio, but might be useful to others in the area.

Nathan Huzzey,

Not sure a licensed "professional" would do the work without pulling permits. He has much to lose if it goes bad as well.

Paul Nagy,

I like it...cash-in about $25.9K (down + ~ closing + 10% for initial repair"stuff"). NOI around $229/month = rough CR of 10.6%. You didn't mention utilities so this is assuing tenants pay all their own.

Now, the first year that you'll live there you'll have neg cash flow for this unit, but you know that.

If they're units with no skeletons in the closets, I think it is a good solid base hit.

If an investment depreciates by 30% it must then apprecitate by 43% just to get back to even. Do I think real estate (across the board) will appreciate 43% in the next 2-3 years? Nope.

Of course a realtor wants you to pay full market price.

You must look at your objectives. For me, cash flow is key (when dealing with buy and hold rental property). If market value doesn't allow acceptable cash flow, then I can't buy it...the carrying cost is too high for the "promise" of appreciation down the road.