All Forum Posts by: Stuart Udis

I am currently renting a condo and the tenant has expressed interest in purchasing the unit at the end of her lease. However she informed me she recently received negative reporting for failure to make 3 consecutive payments. I do not believe the misssed payments were financially driven, rather lack of oversight. She asked if I had any guidance on removing the negative reporting and admittedly informed her I am no familiar with this process other than it being my understanding goodwill requests are generally rejected and the credit repair companies are generally subscription based money grabs.

The one thing that stuck out in our conversation was the fact she initially applied for indiviudal student loans each year or semester (can't recall) and she pays one amount monthly that covers each individual loan yet each loan is reported indvidually so she has  4 or 5 90 day late derogatory marks on her report.  Assuming there was a financial element to the missed payments, it seems unfair to not have the opportunity to pay monthly for individual loans and the failure to pay all resorts in derogatory marks against all. Seems inequitable. Has anyone come across this or used this sucesfully as a basis to remove reporting?

$1.5M to $5M is an enormous spread. What differentiates the price point? Lot? Home? Combination of both? Also, in most markets there comes a price point where "high end" means the buyer truly cares who the builder is. It can become very difficult to deliver a product if you if you don't have the requisiite name/brand. Important to know this ahead of time as you may find youself having to associate with a builder that checks that box as well.

You are raising completely irrelevant scenarios. This forum thread is about syndications. One of the most complexed and demanding investment strategies that carries enourmous responsibility. Paying for an MBA or Law Degree (while I can argue may not be the best ROI for many) is very different than paying for a sydnication course. Let's stay on topic here. The individuals who are paying $10K for a syndication course are not taking the information they learn to seek employment, continue to learn their craft, build a balance sheet and then strike out on their own. They are spending $10K beleiving they will immediately be able to go out and raise capital and syndicate real estate transactions. Are you telling me the person without the financial means to make a $100K LP investment should be raising millions in capital to pursue 50 unit apartment syndications as the GP because that's what's happening. If you believe that is acceptable then you are the type of dilusional real estate investor these coaching and mentorship programs profit off of.

@Zach Howard  I am not against education whether it be through a book, these forums, coaching or mentorship but you can't teach a balance sheet. I also recognize syndication can mean a lot of different things and I am referrring to the courses and mentorship that supposedly prepare you to jump into 50+ unit buildings. If I were to offer the students out there pursuing those various mentorship programs two options: 

Option A: Invest $100K in a syndication where daily access is provided from acquisition diligence through exit and make a ROI on your capital; or

Option B: Pay $10K to take a syndication course

Guess what option most will select? Option B. You know why? They don't have $100K to their name. Now explain to me how someone who doesn't have $100K to their name should be receiving training on how to syndicate 50 Unit real estate transactions?

@Max Pfeifer You are definitely asking the right questions. I am generally in favor of purchaseing investment real estate in an LLC but one of the exceptions is the ability to acquire a property using FHA financing. The leverage (when good purchases are made) can be such a powerful tool to turbo charge your real estate investing journey.

Just be mindful of the transactional costs associated with buying and selling real estate (namely selling). It's critical to focus on growth areas where you can benefit from appreciation. Without appreciation, unless you hold that real estate for an extremely long time, you are likely bringing a check to settlement when you sell an FHA property levered at 96.5%. At the same time, there's no better ROI than hitting on an FHA property where you put down 3.5% that appreciates significantly.

Also, despite what you may read on these forums or see elsewhere there is absolutely no reason to create an LLC to mange the property, collect rent or do any other function related to the property you acquire in your name using an FHA loan. Provides zero protection or benefit whatsoever.

The family member who loves you most.

@Zach Howard You are leaving out key details on how many of these students operate, often at the direction of their mentors/coaching programs. The students are awarded Co-GP status (normally 1% or some nominal piece of the GP) in return for raising capital or finding a deal and then turn around promote these transactions on their personal websites and through social media/online forums in a manner where a  reasonable person would believe their role in the transaction is far greater. These students could easily disclose their role on their websites and social medial promotional materials but are intentionally silent in order to boost the perception of their track record and credibility.  Getting access is one thing, but using the Co-GP status in a misleading manner is problematic and deceitful. That's whats happening.  

@Amanda Gauthier No course is going to to prepare you to syndicate real estate transactions. These courses teach you how to underwrite and "teach" you how to raise capital. I will apply your circumstances to how these course/mentorships unfold:

You will start raising capital and you will struggle because you have no track record. You will begin with your friends and family and they will dismiss you because they know your experience level and going from owning two SFH's to syndicating larger transacitions is not a normal progression. The 506(b) route didn't work and they are out. This is normally the low hanging fruit and when they dismisses you, you will turn your attention to raising from randoms spending more money on filing as a 506(c). You won't have success there either because track record and experince is still a problem. You will go back to the people who taught/mentored you and they will offer you a proposition: Find us deals or raise us capital for our deals and you can use our trackrecord. In return we will make you a co-gp and the next time you go to raise money you can promote yourself as a GP of this large syndication. Raising capital will come easier. That's the playbook and its incredibly deceptive.

Meanwhile the companies who are spearheading thesee courses and mentorship programs are being paid to train their future boots on the ground deal finders and capital raisers. Is that what you have in mind? I suspect the answer is no. Therefore my recommendation is to continue to grow your portfolio organically while learning the business through experience (the best way), be exposed to more sophisticated transactions by seeking employment from larger operators, or a 3rd which I didn't include in my earlier post which is to invest in  syndications/deals where access is offered and you can make a return on your money while learning. 

@Mohan Chhabra I remember reading about this one when plans first emerged. From my recollction it was a bit controversial becausee the existing building was set up as artist studios, a little different than most conversions in the neighborhood which relied upon vacant buildings. How's the project progressing?

@Amanda Gauthier I can appreciate the desire to scale your business, but raising outside capital comes with a huge responsibility. There are few things in this industry I hate more than the syndication course/mentorship model. If you believe more experience is required before you can raise money then seek employment from a larger operator and/or continue to build your portfolio organically and learn the business. Pay a fee  to skip the line using disney lightning lane pass. Not for your GP badge.