All Forum Posts by: Tyler Mutch

@Anthony Cozcoz I would go through an attorney at your local/preferred title company. It’ll be a couple hundred bucks but they’ll handle everything revolving around the closing and contracts to make sure it’s all done correctly!

Hi, 

I work in the trades as an electrician. I would be hesitant to do an out of state new build from the ground up, especially if this is your first deal. There are a ton of things that can pop up during a rehab to significantly delay the project, and theres going to be holding costs. The other thing to consider is that most of the time builders don't see a return for 18-24 months, are you prepared to have no cashflow for that period? 

Hope this helps. 

Hi Malcom, 

What are you currently doing for a W-2. does that in any way help someone in the real estate space? Are you good at marketing, can you sell? Providing value for many of the bigger investors comes with helping them enhance their business, and you'll many times come in as essentially an apprentice! 

Hope this helps! 

Hi Anthony, 

I would say that one of the best ways to get the ball rolling on this front is to define what a "good deal" is going to look like for you. Are you in it for the cashflow and need to retire yesterday? You're going to pursue a different strategy than someone who is happy in their job and is looking to build more wealth! If you don't know what you want, you can get stuck trying to make everything fit and waste a ton of time on deals that you really aren't interested in! 

Hey group,

Looking for some advice here, I have a couple of first lien notes on two separate investment properties owned by an investor in my local market. 

One of the notes is for 9k @ 20% interest only (150 a month), the other is 12k @ 15% interest only again (150 a month). The trouble I am having was that originally the terms were supposed to be for a year (expiring September 2021), then we verbally agreed to extend to March of this year. I understand the flaw of doing it verbally. He has been on time with the payments and I haven’t have any trouble collecting the cash flow. I am currently trying to refinance some of my portfolio and would like to have more cash on hand so I am looking for options to either sell the notes with no real defined repayment period (I’m speculating he will need another extension come March) , interest only payments, or find a way to leverage against them (if possible). 

How do I go about valuations for these notes? 

What else should I be looking for when looking to cash out on these notes? 

TIA

@David Seemiller

How long have you owned them? Most of the time banks will count that income as long as they’re on your tax returns. I was in your situation like a year ago, I had run out according to one bank because they wouldn’t look at rental income for two years. I just refinanced those two, bought another and have a preapproval from another bank who would count the rental income.

Hope this helps!

@Jimmy Mooney congratulations on getting the rate and payment down.

Gotcha, so your heloc that was enough for the down payment was the 60%-75%. Usually banks do 75% on a cash out but will go higher on a HELOC( I just got 90% LTV) I would check around and see if any other bank could go higher on the LTV for a heloc and allow you to be at that 20-25% down on an investment. If you wanna shoot me a message to discuss more details I'm up for that!

Just make sure you have an exit plan and are comfortable with the additional payments.

@Stephanie Peterson I think especially now banks are tightening on the down payment amounts, so traditionally you may be stuck.

That being said, it doesn’t have to be your cash, if you can get it from someone else as an “investor” is one route. What about your primary residence? Can you get a heloc or access an equity from that? Also, I just refinances with a smaller local bank and they suggested that I open a business line of credit based on the value of my other properties. I would for sure look into those to help you get that down payment put together.

I don’t know what your market is like, but I just did a seller finance deal earlier this year with only 10% down and just refinanced out of that.

Hope one of these suggestions helps!

@David Seemiller I’m pretty sure commercial lenders are more relaxed. It’s based more on the asset and a certain loan to value rather than your personal situation. But the interest rates are usually a little higher!

Can you raise enough capital for the purchase price that you’d be looking at, season it for six months and then refinance? That would help with a couple of things; you can put in “cash offers” which are quicker and less red tape when closing! This would also allow you to keep growing providing the numbers make sense on the rental you’re purchasing!

Hope this helps!

@Jimmy Mooney no sweat! That’s what the forums are for.

I’m not familiar with your specific market, but what would the probability be that you’d be able to house hack in your area? That way you could potentially cut your primary living expense and then rent your current residence to begin generating some additional cashflow!

Have you gotten it appraised? I wonder if it would be worth speaking with a lender in your area to see about getting an appraisal to see just how much equity you have and then being able to go from there!