All Forum Posts by: Selina Giarla

Also @Selina Giarla , this is just for your consideration , I know one CU that has 10YARM "Movable" product that their ARM is always have spread of negative 50-75 bps compare to 30YFRM.

Currently they have:
10/10 40 Years APR 6.440% Payment per $1,000 $5.77
30YFRM 6.875% APR: 6.892% Payment per $1,000 $6.57

Quote from @Selina Giarla:

Quote from @Jake Andronico:

@Selina Giarla

In Reno, NV w/ 50% down there are a ton of turnkey deals. We're seeing new builds as some of the best value right now because they're looking to offload their inventory before the end of the year. 

Would be happy to send analysis. 

 Hi Jake - yes I would love to hear more about these. The nevada state/city tax is higher than the MA state tax I pay so I would also need to factor in the income tax to be paid there in my analysis.

 Nevada has no state income tax and the 4th lowest property taxes in the United States.  Property taxes do not assess on the sale of a property. 

I would stop for a second.   With your current investments how many more do you need to hit your number?  With the returns you currently receive?  Both cash flow and expected appreciation.  

Even if you could hit your number how do you scale?  Financing, downpayment, plumber, property manager by towns, lawyer, real estate agent, personal time, etc.  

I would recommend you change your REI investment approach.

Let us know how much you need to scale to hit your number If you can't do it, then let's discuss another REI model.

Quote from @Selina Giarla:

Quote from @Guy Gimenez:

Quote from @Selina Giarla:

Quote from @Guy Gimenez:

@Selina Giarla

Sounds like your sourcing your "deals" from the MLS (retail market), which means you're paying retail most of the time. It's always hard to cash flow retail deals which is why most investors market heavily to locate motivated sellers. Profitable deals are found primarily off market through dedicated marketing or through relationships.

 I would love to understand how to get into the club of these off-market deals. Where do I start and what makes them "off-market"? You are correct, I am only involved in searches on zillow, crexi, and the like. Would love your guidance here.

 Off market sellers need to find you, not vice versa. 

 1. SEO

2. Pay Per Click

3. Social media ads

4. Relationships with other investors and/or bird-dogs (ie deal finders)

5. Driving for dollars

How and on what platform do I let them know I am looking? LOL

You'll need a website / landing page; FaceBook and Instagram account. If you're not familiar with social media marketing or SEO, you'll need to hire a specialist who can get you off the ground and running. It's expensive though...always has been, always will be. But that's where the distressed sellers are found. You can also try direct mail to targeted households. The return will be lower but it is less expensive. 

There are definetly DSCR lenders should be able to offer an IO and ARM mortgage.

Quote from @Selina Giarla:

Quote from @Stacy Raskin:

Quote from @Selina Giarla:

Quote from @Stacy Raskin:

@Selina Giarla, what kind of loan are you trying to do and is it for an investment property? If so, what state and what are the details? There may be some additional loan programs depending on the situation. 

It would be for a rental. I was aiming for texas but open to other landlord friendly states so long as the numbers work. I just need an idea of where to start. I have no idea... is the 10/1 int only ARM at 9%, 7%? Pts, no pts? Not sure.

An option is to get a DSCR loan. 1-4 unit programs generally have better rates compared to 5+. These have 30 year fixed options.

More info here:

DSCR loans won't use your income to underwrite the loan.

DSCR loans are based off of down payment, credit score and either actual or market rents so it helps to supercharge an investor's real estate goals and net worth.

Here's a bit more in detail about how rates are calculated for DSCR loans:

1. Credit score- the higher the best. 760+ generally gets best pricing for investment property loans with most lenders

2. Loan to value ratio: The higher the loan to value ratio (LTV) is, pricing takes a hit. So your pricing will be higher for a 80% LTV loan than for a 60% LTV loan.

3. Prepayment penalties- usually 1-5 year terms. The shorter the prepayment term has an impact on increasing the rate.

4. Are you cash flowing the property? More on how that is calculated below. Is your DSCR ratio greater than 1-meaning are you cash flowing (according to the lender's criteria of mortgage, property taxes and insurance (and HOA) if applicable). Many lenders will not do a DSCR loan unless cash flowing. If they will do a loan with less than 1, the pricing takes a hit. This criteria is for 1-4 and 5-8 unit programs.

I've included an example below to help illustrate this.

So different lenders have different rates (which do vary even for DSCR loans) but these are factors they all consider.

See example below:

DSCR < 1

Principal + Interest = $1,700

Taxes = $350, Insurance = $100, Association Dues = $50

Total PITIA = $2200

Rent = $2000

DSCR = Rent/PITIA = 2000/2200 = 0.91

Since the DSCR is 0.91, we know the expenses are greater than the income of the property.

DSCR >1

Principal + Interest = $1,500

Taxes = $250, Insurance = $100, Association Dues = $25

Total PITIA = $1875 Rent = $2300

DSCR = Rent/PITIA = 2300/1875 = 1.23

DSCR lenders generally let you vest either individually or as an LLC. It's a great way to increase your net worth and these loans can also be used to pull cash out of a property as it appreciates allowing you to reinvest money into new deals.

Happy to connect to discuss further. 

Thank you! Are DSCR usually fixed rates? Do they require annual DSCR tests? Do I need to refi to pull cash out? I see you referenced that so curious how that works. Does LLC as borrower have a higher rate than if it were personal? What if the LLC would be brand new with no financial history? Assuming DSCR is greater than 1, are the rates usually better than 30 yr fixed. Is there an I/O option?

DSCR can be fixed rate or adjustable. DSCR ratio is done once at purchase or refinance/ when the loan is worked on. Cash out is possible if there's equity depending on DSCR ratio if DSCR loan. LLC same rate as personal name but some lenders have LLC review fees. For most lenders, fine if new LLC. Rates depend on lender. There are 30 year fixed rates that are similar to interest only. There are 40 year fixed options with 10 year interest only and then 30 year fully amortizing.

Quote from @Selina Giarla:

Quote from @Bob Stevens:

Quote from @Selina Giarla:

I'll start here... I have 8 doors. I have been involved in many facets of real estate. I am not a newbie but my portfolio is small and I am eager to grow it fast. I like to stick with 2-4 unit properties so I don't need a commercial loan, and I don't have a ton of cash in the event of a massive vacancy or capital investment, so more expensive isn't necessarily in my wheelhouse. I recently started out of state investing in Texas. Since I am out of state, I like to avoid the uncertainty of older home and prefer new builds or houses that are within 10 years old, max. I prefer Texas because it's a landlord friendly state, there is no state income tax so I don't need to file taxes in TX and MA (where I am from), the tenant's pay for a lot of the repairs, maintenance, etc. and there are no snow removal costs. Construction/Labor is cheap and its a growing state with respect to population, and lack of available housing.

All this being said...I CANNOT find a good deal. The houses are expensive, the rents haven't caught up, the int rates are through the roof, and the rent alone cannot even cover the operating expenses and debt service, nevermind turn a profit. Even if I go up to 50% equity, and zero out my vacancy factor, cost to lease, R&M and CapEx underwriting, I barely turn a profit (a few hundred a month). I want find a deal and put in an offer within the next 2 months. How are you all finding anything that makes sense?!

 I live on the beach in FL and do all my biz for many years in the Cleveland markets, deals everywhere. All my personals have always been not less than 20% NET cap based on cash purchases. I will close this week on a duplex all in full reno 80k, rented for 19k a year. Sf all in 75k, rented for 1300. TODAY I will go to contract on a 2 br all in will be 45k, rented for 1k. Again best part I am on the beach in FL, 

Good luck 

BTW whoever is telling you to avoid props older then 10 years old, simple has no clue what they are doing. Every property I flipped (about 500 YES 500 )  or owned was built between 1910- 1930. They were built better back then, 

 Such great numbers! Do you hold long term ever? I struggle between investing all cash or debt because my strategy is more towards holding long term. How do you source a reliable contractor to do renovations out of state? And who is "watching" them?

 hold for a while and flip some. I have an entire team in place. I literally just got off the beach and have guys working on 4 renos and one walking that 2 br I mentioned. 

Good luck 

Quote from @Selina Giarla:

Quote from @Stacy Raskin:

@Selina Giarla, what kind of loan are you trying to do and is it for an investment property? If so, what state and what are the details? There may be some additional loan programs depending on the situation. 

It would be for a rental. I was aiming for texas but open to other landlord friendly states so long as the numbers work. I just need an idea of where to start. I have no idea... is the 10/1 int only ARM at 9%, 7%? Pts, no pts? Not sure.

An option is to get a DSCR loan. 1-4 unit programs generally have better rates compared to 5+. These have 30 year fixed options.

More info here:

DSCR loans won't use your income to underwrite the loan.

DSCR loans are based off of down payment, credit score and either actual or market rents so it helps to supercharge an investor's real estate goals and net worth.

Here's a bit more in detail about how rates are calculated for DSCR loans:

1. Credit score- the higher the best. 760+ generally gets best pricing for investment property loans with most lenders

2. Loan to value ratio: The higher the loan to value ratio (LTV) is, pricing takes a hit. So your pricing will be higher for a 80% LTV loan than for a 60% LTV loan.

3. Prepayment penalties- usually 1-5 year terms. The shorter the prepayment term has an impact on increasing the rate.

4. Are you cash flowing the property? More on how that is calculated below. Is your DSCR ratio greater than 1-meaning are you cash flowing (according to the lender's criteria of mortgage, property taxes and insurance (and HOA) if applicable). Many lenders will not do a DSCR loan unless cash flowing. If they will do a loan with less than 1, the pricing takes a hit. This criteria is for 1-4 and 5-8 unit programs.

I've included an example below to help illustrate this.

So different lenders have different rates (which do vary even for DSCR loans) but these are factors they all consider.

See example below:

DSCR < 1

Principal + Interest = $1,700

Taxes = $350, Insurance = $100, Association Dues = $50

Total PITIA = $2200

Rent = $2000

DSCR = Rent/PITIA = 2000/2200 = 0.91

Since the DSCR is 0.91, we know the expenses are greater than the income of the property.

DSCR >1

Principal + Interest = $1,500

Taxes = $250, Insurance = $100, Association Dues = $25

Total PITIA = $1875 Rent = $2300

DSCR = Rent/PITIA = 2300/1875 = 1.23

DSCR lenders generally let you vest either individually or as an LLC. It's a great way to increase your net worth and these loans can also be used to pull cash out of a property as it appreciates allowing you to reinvest money into new deals.

Happy to connect to discuss further. 

Quote from @Selina Giarla:

I'll start here... I have 8 doors. I have been involved in many facets of real estate. I am not a newbie but my portfolio is small and I am eager to grow it fast. I like to stick with 2-4 unit properties so I don't need a commercial loan, and I don't have a ton of cash in the event of a massive vacancy or capital investment, so more expensive isn't necessarily in my wheelhouse. I recently started out of state investing in Texas. Since I am out of state, I like to avoid the uncertainty of older home and prefer new builds or houses that are within 10 years old, max. I prefer Texas because it's a landlord friendly state, there is no state income tax so I don't need to file taxes in TX and MA (where I am from), the tenant's pay for a lot of the repairs, maintenance, etc. and there are no snow removal costs. Construction/Labor is cheap and its a growing state with respect to population, and lack of available housing.

All this being said...I CANNOT find a good deal. The houses are expensive, the rents haven't caught up, the int rates are through the roof, and the rent alone cannot even cover the operating expenses and debt service, nevermind turn a profit. Even if I go up to 50% equity, and zero out my vacancy factor, cost to lease, R&M and CapEx underwriting, I barely turn a profit (a few hundred a month). I want find a deal and put in an offer within the next 2 months. How are you all finding anything that makes sense?!

 I live on the beach in FL and do all my biz for many years in the Cleveland markets, deals everywhere. All my personals have always been not less than 20% NET cap based on cash purchases. I will close this week on a duplex all in full reno 80k, rented for 19k a year. Sf all in 75k, rented for 1300. TODAY I will go to contract on a 2 br all in will be 45k, rented for 1k. Again best part I am on the beach in FL, 

Good luck 

BTW whoever is telling you to avoid props older then 10 years old, simple has no clue what they are doing. Every property I flipped (about 500 YES 500 )  or owned was built between 1910- 1930. They were built better back then,