All Forum Posts by: Travis Sperr

@Jenny Bayless You may not need a cash out refi if you structure the deal a little different - if you are using an HML to purchase and rehab the property, presumably at about 70% of the ARV and then do a rate and term refi into your conventional loan. The conventional lender will lend you 70-75% of the value, you can typically roll your closing costs of the refi into the new loan - only leaving about 3% of equity above the conventional loan requirement (not worth cashing out because of the seasoning requirements). The 6 month cash out refi (when you haven't paid cash for the property), I believe to be a fannie requirement, most banks are going to be 12 months.

If you are not getting 70% of the ARV in your initial loan and paying HML rates you may look around a little bit. I bought most of my rental properties using this strategy and would be happy to walk you through it if the post isn't clear.

Welcome @James Coplin there is more information than you will know what to do with right here on BP! I also encourage you to checkout the meetups around town, there is a lot of free and low cost meetings that will help you grow your network. 

Last note - do not buy any training or course that cost more than $200 until you have been around the business for at least a year. You will thank me later for this. 

Good Luck getting all learned up!

@Account Closed there is a lot of information you can find concerning this topic online - the biggest issue is if you disturb the lead based paint and the amount typically measured in Sq Ft that is disturbed. The LBP doesn't need to be removed just because it is there.

Spend some time on this site:

https://www.colorado.gov/pacific/cdphe/pre-renovat...

Be sure to hire a contractor that is LBP certified - which is like a 4 hour class and maybe an exam the threshold is pretty low. 

Good Luck!

@John Samuelson I am not a CPA -

There are no income tax implications on a cash out refinance - it is a loan not income. 

You cannot do a 1031 exchange with the cash out proceeds.

You should run it by your CPA based on the questions you asked.

@Lyle McCartee I think you are going to have a tough time with this loan for a few reasons - not a lot of private/hard money lenders lenders making loans in Pueblo, the loan to after repaired value is about 84% LTV, most will want to be around 70% and lastly the rate you are looking for is too low for the loan to value you seek.

Best of luck on this one!

@Andrea Michels you will want to use the @ symbol (followed by at least 3 letters of the persons name you wish to tag) otherwise they may never see your post. 

Thanks @Matt M. for the mention. 

@Ginny West happy to connect and provide some direction to you. 

I can offer a little insight here as this is exactly what our company does. We have raised about $60 million in our mortgage funds and individual private investors.  As a few have mentioned there you can be brokered a note meaning you are the lender on the note and deed of trust or we raise money in a private placement fund and use that money to make the same loans. Neither is a loan from the money investor to the lender (it is an investment) as there is no promise to pay from the lender, the payments come from the borrowers. In either case liscensing is not required to make the loan in Colorado but is required to broker or raise funds. 

Clearly there are pros and cons to both types which have a lot to do which how much money you have to invest, how many days of the year your money will be invested and ones trust for the manager of the fund. 

10% is a decent return to do the lending yourself, in first position, but if you have only one borrower my guess is your money is on the sidelines at times bringing your effective return down. Even is a lender is charging 4points and 12%, in most cases the the lender would keep the points and a servicing fee as part of the rate so your return would be the same, but if they could keep your money working 365 days a year you would have a higher return. 

Happy to answer any other questions anyone may have. 

With limited information provided - I think you need to start by figuring out what your goals and immediate needs are. If investing in real estate is more important to you than where you live, it sounds like Florida is a good option based on what you shared. Getting a real estate license would certainly be helpful to better learn how transactions work and give you the ability to create some income through commissions so long as you have time to focus on it. 

If $10k in debt has you strapped you might consider working as much as possible to pay that off and save another $10k to take a real run at investing. Of course there are no money down real estate investing models, but in our market will require a lot of marketing dollars to find the leads. 

Real estate success has everything to do with how hard you are willing to work at it. Not just reading books and listening to podcasts, but networking, knocking on doors, beating the streets for the right opportunities.

@Rob Grove in order of your questions.

Certainly you can wholesale from a distance with the right team on the ground in the market, especially since you will likley be more familiar with your current market than your new market.

As far as a duplex, I am not the best to answer it has been a while since I have been on the hunt for a duplex. Very difficult to even consider without knowing your ability to finance.

Wages are likely similar to the Twin Cities, with less taxes (likley hire in some fields - tech, construction, etc). There are plenty of houses under $400k in the suburbs, under $200k very tight, all depends on where you want to be. Rents are high but not that far off of what I have seen in the cities. I have no idea what the positions you listed pay, too far outside of my expertise.

Good Luck!