All Forum Posts by: Steven Goldman

What's wrong with it that the attorney is not going to keep the profit? Or is he just a generous egalitarian attorney? If you want to be a landlord than buy and hold. If you get a good return on the cash out so be it. Be aware that their are seasoning rules regarding properties purchased at sheriff sales. Also investigateate the title carefully especially if the foreclosure was by default. Make sure it is insurable. We regularly do cash out refinancing for BRRR investors. Good luck!

I suggest that you look for off market properties. This is harder work but has a greater reward. Some suggestions:

Here are three methods of finding off-market opportunities that your competition doesn’t know about:

1. Cultivate and nurture your connections to property owners and brokers. Since you can’t rely on listing services or online marketplaces to inform you about off-market opportunities, relationships are especially important. You are more likely to hear about an asset on the sale block first if you already keep in touch with potential sellers. And if you learn about it first, you have more time to prepare for the deal.

1. Get on buyers’ lists. Through the above-mentioned relationships, you can get yourself placed on buyers’ lists that keep you informed about properties that are quietly up for sale. You’re more likely to discover “,” deals that brokers know about but sellers don’t want to list for fear of alarming tenants or management.

1. Become hyper observant. Find off-market deals by discovering them before the seller commits to selling. A property with deferred maintenance or poor Yelp reviews could be ripe for new ownership and management, and a seller looking for a way out will welcome a pro-active lead. The same might be true if an owner has held the property for many years and has been toying with the idea of listing it. Without the rush from competitive buyers, that seller may warm up to an interested investor.

Remember most lenders will only lend on investment properties that have a debt service coverage ratio of 1.0 or greater. 1.0 is the minimum. Banks like 1.25. You calculate D.S.C.R.  by assuming a 20 percent down payment or 80 percent financing. Estimate the interest rate and then use a 25 or 30 year amortisation. After you have calculated your principal and interest payment add 1/12 of the insurance and taxes. That is the monthly debt you need to service. Next,  calculate the monthly income less 5 percent for vacancies and repairs. Divide the income by the monthly debt service and you have a D.S.C.R. 

Example: 1200.00 income 1150.00 debt service = 1.04 this is marginal. So make sure you know if the property can be financed prior to your offer. 

If the property does not work values are rising faster than rent. This is a problem throughout the Untied States at the moment. Remember most lenders do not like small loans.So messing around with $100,000.00 properties is for someone with access to their own capital (or a partner who has capital)through savings, HELOC or borrowing against their 401k. These lower value properties located in Urban core areas are hard to refinance but often have good cash flow.

Good luck!

Here is an article about the suburban Columbus real estate market. I would stay with bigger suburban areas as small towns can be harder to finance. 

https://www.newhomesource.com/...

Columbus is a strong market. To find a good deal you will have to find properties through wholesalers or off market websites. The competition in Columbus is stiff. Many of the surrounding suburbs are still not over appreciated and may be a rewarding place to look. We have made numerous hard money loans in Columbus and Ohio. If you find a property feel free to send us the scenario and we will lend our view point to your decision. Good luck! I love real estate a great place to invest your time and money.

A multi unit property is not for someone who does not have capital to maintain, rehab and invest. Most of our investors start with a 10-20 multi unit in order to establish the necessary procedures and relationships to be successful in the multi family market segment. Do not enter into an agreement on a 70 unit multi family that needs rehabbed without a full inspection and understanding of the potential expenses which may lay ahead. We finance multi families and you should also determine what the ARV will be when the building is returned to a more standard condition. Are you planning on student rentals? Be prepared for repairs and damages on the turn over of the units. We wish you good luck on this project!

https://www.google.com/maps/pl...  Here is a link to the building today. Observe the eaves and he incredible d aluminum installation by scissors lift and individual fabrication. Work of art. Preserved historic nature of the building.

Will dig them up and put them up for viewing. Built prior to the digital age.

Investment Info:

Office Space commercial investment in Quakertown.

Purchase price: $225,000
Cash invested: $350,000
Sale price: $975,000

This was a purchase of a Methodist church and parsonage. The previous purchasers withdrew at the last minute leaving the church who had built a new facility without a buyer. My partners and I stepped in and purchased the building, invested $350,000 for exterior maintenance and interior remodeling. Saved the sanctuary with hammered tin walls and ceiling and incorporated them into the design.

What made you interested in investing in this type of deal?

We needed a bigger location and wanted to preserve the integrity of this building which was erected in the 1800s.

How did you find this deal and how did you negotiate it?

Heard that the purchasers had left the church in a bind.

How did you finance this deal?

Bank financing

How did you add value to the deal?

Refurbished exterior with custom ornamental aluminum capping of the block and gingerbread on the eves. and fascia. ($78,000.00 80 feet in the air) Preserved the historical architectural interior of the sanctuary and the stained glass windows.

What was the outcome?

Excellent the building is adds value to the community.

Lessons learned? Challenges?

Always think big and never be afraid to tackle a bigger project. Always hire good professionals. Especially a
historic architect who can help renovate an older building.

In the current environment if you have funds you may win the day during the contract battle by not having a mortgage contingency in your agreement. When you pay cash for the property you must be aware of the cash-out refinance issues. First, on a cash out refinance, you are going to be limited to 75 to 80 percent. Also, you will not be able to use the increased value which may appear as a result of your excellent negotiating skills. What I mean is this: If you get a deal by buying in cash and it is under market value, you will not be able to refinance above your purchase price for one year unless you make significant improvements to the property. Cash works for a rehab and BRRR not so good for a buy and hold if you wan to get your cash out quickly. So your operating capital may be tied up for a period of time. If you are relying on a cash out refinance as your exit strategy than you need to talk to your lending source to make sure you can get your capital out without disrupting your real estate acquisition schedule. Good luck and happy hunting. Real estate investing is great!