First Deal Help (Hard Money)
Hello BP Team!
Our team is new to REI and have our first deal under contract. We have to close by Nov. 25th.
So, let me start off by explaining how our LLC's structure is set up and I'll attach a graphic that might help as well. In essence, Triumph Investments & Holdings is owned by 4 LLCs. 10 people total own the 4 LLCs (broken up by families).
- The lenders have to see every LLC's operating agreement and I will have to use a standing power of attorney in order to close on behalf of everyone else.
This is our first property and out of all 10 of us, no one owns their primary residence, nor have any experience.
Deal:
- 4-plex
- BRRRR strategy
- Purchase price: $75k
- Rehab budget: $25k
- Currently, tax assessor values land + building for $144k
- No MLS access and could not get in contact with the two rehabbed quadplexes on either side. Tax assessor values them for $142k and $144k, but I don't know if that's before their rehab or not.
- I did NOI - (accounting for vacancies, repairs, and management) / typical Cap Rate = $190k but banks wont use that for 4-plex.
- We've had the title search done as well as an inspection and had an inspector come in with a $17k bid.
Lender:
- Due to BRRRR, we are using hard money lender.
- Down payment plus fees and what not
- They are requiring $1500 up front just for appraisal and inspection
- Is this standard? I don't think we should have to pay for another inspection, since the inspection we had conducted was performed by a licensed inspector.
Questions:
- The purpose of our structure is to keep individuals anonymous for liability reasons (Created in Nevada). Should I look for another lender that respects this? Or is that standard?
- Is the second inspection standard? I don't think we should have to pay for another inspection, since the inspection we had conducted was performed by a licensed inspector.
- Is an $8k buffer enough for uncertainties?
- How are inspectors going through hard money deals so fast and with minimal costs?