All Forum Posts by: Sam L.

Thanks for the tips. I do have a strong personal income/credit, so worry a bit that asset based lending would not play to my strengths, especially in my area where you need to rely on tenant turnover to get up to market rents (working at a loss or breakeven until then).

I realize its a standard requirement, was hoping there might be a non-standard lender which would consider W2 income in place of that.... I've heard talk of "global DTI" and my total DTI should work out for the buildings I'm looking at.

Hi BP, I've got a duplex (and a condo) currently, and am looking to make the jump into 5+ units, but it seems lenders want 100% net worth on these loans. Anyone know of a lender who doesn't have that req? I am looking at places about $2mil, and have 20ish % cash down payment, and have very good documented W2 income and credit, but don't have the $1.5mil+ net worth they seem to want.  Any way to make the leap, or do I just need to keep saving?

I believe https://www.studebakersubmeter... might be able to work with what you've got, give them a call.

Is this more than a 4-plex? Do you also meet the net worth requirements?

That's different.  Most houses have 2 car garages because that's what LA R1 zoning requires.  He's quoting the RD15,RD2,etc rules, which are trickier.

This chart lays it all out (but be sure to read the notes, hillsides are different, etc, etc)

http://planning.lacity.org/zone_code/Appendices/sum_of_zone.pdf

How much are you budgeting for foundation/anchoring piers?  I've not gotten estimates on this myself, but have heard that the necessary foundation work for a hillside lot is tremendously expensive on its own.

If you don't even know what rent control is, you may not be ready to be a landlord, you need to do a lot more reading first.

And the first thing to know about the LA area is that there are over 80 separate incorporated cities in LA county.  It can make a huge difference which city you live in.  Take some time and figure out the lay of the land.  It's very unintuitive, too.  North Hollywood is in city of LA, West Hollywood is its own city.  Some cities are better or worse for landlords/property owners than others.

Sorry, I said multi-family but didn't actually clarify, this is a 5+ unit property...  

Thought FHA was only for residential up to 4 units, and only up to the per-county max value. Do they have a program for 5+ unit buildings?

So, as I understand it, hard money is a good option for equity based deals where the borrower's credit & DTI may not be there.

I am looking for a financing option that is basically for the opposite situation. There's a multi-family I'm interested in, where I would be living in one of the units (evicting current tenant for owner-occupancy). The bulk of the other units are rented at below market rates. I would plan on paying over market rate for the OO unit initially, with the idea that reduces as tenants cycle through. Even initially, the property would be cash flow positive accounting for what I would budget for the unit I'd occupy (and can document my ability to pay that higher rent, etc). However, the purchase price of the whole complex is high enough that I would have minimal equity after covering costs, tenant relocation fee, etc.

Any options to make this deal work for someone with good credit (700+) and high W2 income, but nowhere near enough cash for 20% down???  I also own a duplex that's currently 1/2 owner occupied, and after I move out that will easily be cash flow positive, but only have about 20% equity in that so don't think it can help me here.