All Forum Posts by: Tyler Bobo

Property management fees will vary a LOT from one area of the country to the next, from one manager to the next (what do they do, what don't they do) and from one building size to the next.  

Admittedly, I don't have much experience in the property manager field, but my first thought at looking at that is that if they going to nickle and dime you to death on everything, what's the 10% cover?  I would want the 10% to cover a lot of that stuff: they're charging for a lease renewal? Isn't that a one page document extending it and they're charging hundreds of dollars to sign that? Maybe this is all normal but it seems excessive to me.  

There's a million variable in the lending world like your credit, income, debt to income ration, the property type, specific market, how many loans you have, etc.  Historically 5.65% is pretty good but recently there have been better, depending on all those factors and more.  

I would talk to some local and some national or online banks so you're not getting all your quotes from one area.  If you talked to several banks in different areas about your situation and that's the best deal you can find then run those numbers on the properties you want to buy and see if they make since.  I get a lot of private money and gladly pay 10% on some deals (usually not rentals but sometimes) because I know I'm making plenty of money and have no problem paying my investors accordingly.  So I don't get too caught up on what I am paying in interest if my investment goals are met, especially after I've shopped around.

If you know your job has a time horizon and you mention that to your lenders you may have a problem there too.  Definitely don't lie to them, yet if you didn't volunteer that it might help...

@Ley Nezifort "Best Ever Apartment Syndication Book", by Joe Fairless and Theo Hicks.  It was recommended by several people on a previous post and I am listening to it on Audible:)  

Thanks everyone!  Yes @Todd Dexheimer, I'm not sure if fractional debt is a way I'd want to go anyways I just wanted to have a better understanding.  I thought it would be something like Brian explained and glad he verified that for me.  Todd, thanks for showing me how to get to a similar endpoint by using the debt and equity with different preferred returns.  I'm still in the earlier stages of planning and research and very much appreciate everyone's experience.  Have a great day!

Hi Casey, as an Realtor I'm glad you're asking the question, I see both sides of it and no one likes doing a lot of work for no pay.  I would not be asking several agents for help if you know you won't be using them.  I would interview a few agents, probably call around other investors and ask who is good working with investors, and maybe find one that is on or has a small team or at least admin who can do a lot of that footwork.  I'd find one you like, explain you'll be using them to sell, and need help verifying it's a deal when you find off market.  As long as they know you'll use them it will be worth there time even if it's quite a few.  However, you should probably only need them for the final numbers, hopefully you'll be able to know your market reasonably well to have a ball park of what a property is worth and will probably need your agent less and less for that, especially when it's a killer deal and you know there's room.

Also... don't discount the MLS. Don't count on it as your main source for leads however consider that most agents wash out in under 5 years in most markets. Actually, a TON don't last 1 year, and many veteran agents make mistakes on listings. I've bought a lot of deals off the MLS that were either listed horribly or I see something in the property others miss like maybe it could be a duplex for cheap and it's currently not. My favorite one that an agent, a very good veteran agent, had a horrible listing on, was an acre of land with a shack on it that was a moldy knock down. It was a foreclosure too and the photographer went and snapped a couple pics of the shop. The agent, and the photographer, missed the several thousand square foot semi truck shop on the back of the lot! A client called who was out of town and sent me to drive by it. (I wish I would have found it first!) He made a quick flip on it and sold for over twice what he bought it for, cash. So you never know what's hiding on the MLS!

Good luck!

If you're not tied down to a job at the moment and interested in moving into real estate I'd definitely think it would be worth your time to explore some real estate positions.  Depending on what type of investing you think you would like to do long run, consider a job at a property management firm, or as a Realtor, or real estate assistant, lender, or title.  You've got several options there both in the hourly/salary and also commission pay positions.  Try to have a meeting with several folks before deciding.  I'm not sure how much your other professional field earns but if it's not a large pay decrease and you're not super passionate about it then why not? Good luck!

Several people on here recommended the Best Ever Syndicating book, which I a halfway through and had a question I wanted to get out before I forget.

He mentioned you can syndicate for debt as well as equity.  In my smaller deals I use debt investors all the time, usually just 1 deed of trust to fund a distressed single family.  If I have more than one, there's more than one deed of trust and in case of default the 1st position is a way stronger position.

How does this work for a syndication, like if there's 30 debt investors there's not 30 liens correct?  Is there just one and they would end up owning the company/property together in case of default?  And since they're debt investors they're not owners so are they not limited partners in the deal like equity investors would be?  

Thanks for your time!

Thanks everyone for the great responses.  I just downloaded the Best Ever Apartment Syndication book on Audible and will be talking to a few people who replied as well, thanks for taking your time to help.

Danny Randazzo, I'll probably be looking at some smaller ones like the 1-2M range at first, and might just do an LLC with a couple other people yet I intend to move from there on up in value so I want to make sure I'm prepared when I find one that will require syndication. Thanks so much for your input!

I've been listening and reading about syndicating and don't know really what the first step should be. One article here on BP says they're usually structured LLC's or LP's. I've set up quick LLC's in online in my state no problem so where is the line between a normal LLC and Syndication? I'm guessing it's when there's money pooled from passive investors? So do I just need a limited partnership agreement written up by a competent attorney who understands syndicating or what should my first step on that front be? I want to make sure I have my paperwork in order before I go get myself in trouble:)

Side note so people know how to respond, I am not new to investing, or raising money partners one per deal, just looking to step it up a notch so I can get into a bigger playground.

Thank you!

If you have someone you've sold to before or trust enough you can ask them for a piece at the end (if it ever makes it to the end) but don't expect much as it's a long hard road and they'll be earning every bit of it if it makes it.  But most banks won't allow an assignment or double close.  If it's sweet enough you can maybe find a partner with the money and do all the crappy legwork with the short sale process.  It's not rocket science but it sure is frustrating:)  I've never bought one but have done several for my Realty clients.