All Forum Posts by: Taylor Green

Thanks again for all the responses, I'm really learning a lot.

@Will Barnard I have been reading thru old threads trying to learn about buying notes. Just based on your input, it seems like something I'd be interested in. However, I have zero knowledge or experience about buying notes. Do you have any recommendations for books or any other sources of education on the topic?

@Jeff S I'm glad you view this as a good strategy. I have been trying to learn about the different types of HELOCs and have called a couple banks asking about the different options. I never realized there were so many different options. If returns are in the mid-high teens that sounds great, it would make this decision a no brainer for me! Since I'm new to this, I'm also not great with the tax implications so I'd ask my CPA about deducting the interest of the HELOC and other considerations. I will make sure I keep the loan term short, the previous loans I've made thru the broker have been short term, around 6 months before I got my money back.

Thank you guys again...

Thanks @Will Barnard I did misunderstand what you said... I thought you originally meant to only use 65% of your available line of credit to lend out just to be extra safe. The loan broker I have used a couple of times usually only goes to 65% LTV. I'm still learning the whole process, like how to read all the 'due diligence' documents he sends over. I won't lend thru the HELOC until I understand a bit more about the process and develop a bit of a history with the broker.

Do you know what is a standard return most people are getting using a broker? I'm sure finding your own borrowers would generate better returns, but I'm not at the point where I'm comfortable doing that.

Thanks again.

Thanks everybody for all the responses.

The general consensus I have gotten is that it would make sense to do this... A couple of things that I would make sure to do would be:

1) Find a reputable loan broker with a long, proven track record.

2) Don't invest more than 65% of the total HELOC amount available. (Which might be hard to do if the lending produces good returns!)

3) Keep a reserve to make the HELOC payments in case the borrower doesn't pay and have to take over the borrower's property.

4) Learn more about HELOC's... (Balloon payments, interest only payments, etc..) I never even thought about the different types of them.

Does this sound like a relatively safe plan? So far the suggestions have been great, any other ideas?

Thanks again.

Hi,

I was wondering if it was a good idea to lend money from a HELOC on your primary residence?

My thinking is if I own my primary residence free and clear, I take out a HELOC and use it to invest in lending opportunities when the difference in interest makes it worth it...

Ex: HELOC @ 6% vs. Private Loan @ 12%.

In theory, at least to me, this makes sense. I have tried looking for past threads about this and didn't find much on the lending side of it. Is there any downfall to this strategy?

I could refinance, but I just prefer not to have mortgage payments on my primary residence. Thanks.

Thanks for answering. I've been searching everywhere thru the old threads so I could put a link to it. I can't seem to find it, I will keep looking though.

You guys have answered my question though... I wish I would of chose a different thread title.

Absorption rate/rate of sales was exactly the information I was looking for to trying to figure out what a good market would be for flipping, thanks again...

Hi,

I was reading old threads and came across this one...

I know the margins are still tight in Phoenix for fix and flips, but I was wondering if anybody is consistently generating 10k+ profits around the 200-250k price point?

Thanks!

Hi,

I have just been reading thru old posts and I have tried finding out what makes a good market for rehabbing and flipping. Is it the same criteria for a good rental market?

Anyways, I have seen a couple posts mentioning 'the velocity of the market' is what makes a good house flipping location. I was hoping somebody could explain to me what velocity means in real estate terms and also, hopefully, what makes a good market for flips? Thanks.

Just to follow up on this thread.

The city allows you to put up to 200 sq. ft of storage space on the land before it needs to get permitted. The 6 units are on two separate tax parcels, so I'm allowed to put 200 sq. ft. on each parcel without needing it to be permitted.

I have had the property manager survey the tenants if they would have interest in renting a non-AC storage unit on the property for an extra $25-30/month. We had 3 yes, 1 maybe, 2 no response.

I will be putting up 3 connected - 8x6 units to start out with. The quotes have came in from $1500-$4500 to build, including the pad for the units to be built on.

If I charge $25/month for each unit and go with a middle priced bid of $3000, that is an extra $900 a year for $3000 investment. 30% return is good enough for me. Not to mention the increase in NOI.

This is my attempt to add value to the property, seems to make sense to me. I am just starting out though, so I'd like to keep hearing if this is a good/bad idea. Thanks!

Hi,

I was wondering if buying a pre-construction home in a new development will be worth more by the time the all the phases in the development are completed. Thanks.

Thanks Shahriar and Tom.

Tom thanks for all the details, I am originally from Courtenay and usually spend a couple months a year at home on the island. That's great the market is becoming decent to invest in. It is hard finding cash flowing properties up there... If you have any listed, let me know though! Have you seen many fix and flips on the island?

Taylor