All Forum Posts by: Travis Lemley

Arthur,

You most likely need to reach out to a HELOC lender (Banks and Credit Unions are good) in California and conventional lender (Broker) in California if that is where the property is located. Each state will have their own regulations that dictate the Max LTV you can have on a HELOC and Cash Out. In Texas that max is 80% on a primary. In Texas a HELOC is only available on primary properties and a max LTV of 75% on a cash out of investment property. Best of Luck

Booker, that is correct. 4% would be great if you can find that in the LLC. 5.75-6.5% is what I would budget/ pro forma at.

Booker,

Purely on the assumption this is a SFR investment property and not commercial (retail, office, multifamily, warehouse, etc..)

You can keep the property in the LLC and do a rate term refi and typically a local bank will pick it up if you have 680 or better credit, DTI of 38% or lower, and ample reserves. The same criteria you would need for a fannie mae/ freddie mack conventional on an investment property. If a bank isn't biting find a local mortgage broker who works with investors (maybe do this 1st if you know of a few) and they should have contact/ relationships with banks to broker the deal. The other option would be to deed it to your name personally and if you meet the aforementioned criteria you can go fannie or freddie. Our lender only requires that it be in your name 48 hours for straight rate term refi. 6 months if you plan on taking cash out. Rates on the LLC for our banks are 5.75% on a 20 yr am and 5 yr note. On a fannie you can get market which is 5-5.25% 30 yr fixed.

You may want to look at hard money financing for the acquisition and rehab.  Most hard money lenders will lend on the after repair value.  Once the rehab is complete you can do a rate and term refinance out of the hard money loan.  

Rajeev,

Reach out to Colin Nicholson at CBC Benchmark, they are a commercial brokerage company but he is a principal in that entity and a partner residential company.  Direct message me for his contact info.  Or Just google the name above. 

Reach out to the wholesalers.  Let them know the area you are looking and get pre-qualified with a lender so when they bring you a property you can show ability to close.  

I worked in Florida for almost 8 years in the commercial side of real estate as an agent and landlord representative.  We always had leases witnessed by two individuals for both landlord and tenant.  I would error on the side of caution.  

If it seems to much to manage from out of state look for a wholesaler to purchase the property and take the proceeds to purchase something closer to wither one of you so it can be effectively managed.  Good wholesalers are usually fair and reasonable and can coordinate quick closings.  The other option would be to find a hard money lender and use hard money for the rehab and refinance to a long term conventional note so you can rent the house and generate passive income.  Best of Luck. 

You never go broke making a profit no matter how big or how small.  But the buyer could ask the appraiser to consider an adjustment if you have solid data that wasn't considered that should/ could have been.  The other option would be to have the buyer request a new appraisal.  It will delay the closing and be at the cost of a second appraisal with no guarantee that the second appraisal will come in higher than the original.  Best of Luck either way.   

Sorry, need to clarify. Larger deals typically have tiered commission structures.  Under $10 million was straight 6-8%.  Above $10 million tiered with the first $10 million at 6-8% and then the remaining would be paid 3% from $10-20 million, 2% $20-50 million, and 1% or less on the rest.  I never got any deals done at 8% that was stuff I saw in the Carolina and Virginia markets.  In Florida, Georgia, and Alabama we were almost 6% across the board.