All Forum Posts by: Zachary Ware

Before you do anything, consult with someone and find out the tenant/landlord laws in your specific area as these can make a huge difference in your options. You should find out what terms the tenants are renting on from the owner before purchasing. If you like the terms, they match your initial UW, or better, get a lease in place before closing. If you are looking to do rehab on the property or bring the rents up, make sure you follow the appropriate process for your area to end their occupancy after closing.   

Great post! I think you have to be very conservative with your UW assumptions at the moment. I would advise taking a look at deals with no rent growth but continued expense growth. Do you have any market-specific UW advise when it comes to what assumptions you are looking at? 

Great post! Thanks for sharing

Very informative post! How long did this entire process take you for the 26-unit refinance? 

 I don't have any specific recommendations for Evanston, but if you click the Build Your Team tab at the top left, there are some great investor recommended options. 

I don't think this is necessary information to disclose unless it comes up in conversation. The most important factor a broker wants to know is, are you a serious buyer. Do you have a track record of recent purchases? Do you have access to funds to close on a deal that they bring you in your buy box? I think this is a much more important factor than what cities you are looking at. 

Considering the amount of capital you have available to invest, starting directly with multifamily properties could be a favorable option. With a monthly income of 30-50k, you may even have the opportunity to participate in multifamily syndications, gaining valuable insights from the inside.

If you prefer a more hands-on approach, starting with single-family properties can provide a solid foundation in real estate investing fundamentals. While there will be key differences in aspects such as financing and property management, the knowledge and experience gained from single-family investing can be valuable when transitioning to multifamily investments. Though the management and financing can be quite different on a multifamily property, the foundational knowledge/experience will be transferable. 

Alternatively, starting with a property size between 4-10 units could offer a middle ground, allowing you to experience some benefits of both large multifamily and single-family investments. This size offers the opportunity to learn about and experience of managing multiple units, benefit from economies of scale, exploring financing options, and potentially considering partnerships. 

For anything non-owner occupied you are going to be looking at putting 15-20% down. For out-of-state financing, if you are looking for a turnkey property, I recommend a DSCR lender or a bank/credit union that is local to the property you are looking for. The advantage of a DSCR lender if you can find one that will lend anywhere in the country and they will be much easier/quicker to work with. Working with a local bank/credit union may provide you a better rate because they will know the market and feel comfortable with the risk of loaning on a property in their backyard.

There are multiple factors that affect the interest rate as Doug Smith said. You should reach out to multiple lenders and once you have enough quotes, you will be able to see which are high and low rates for your specific circumstance. Rates change often, even daily, so making sure you get quotes around the same time frame is also important if you are trying to judge them apples to apples. 

Hey Branden,

A different strategy you could look at for financing would be a DSCR loan. These loans are based on the profitability of a property, not the income of a borrower. These types of loans do require you to bring more cash to close as the LTV will be as aggressive as FHA.

There are many resources to learn more about DSCR, please feel free to check out the following link to find out everything you need to know about DSCR loans. DSCR Loans Guide