Advice please!

[Nicole Clemens]

Hi guys, 

I purchased an SFR using private money and am now in the process of doing a cash out refi. My goal is to be able to purchase more rentals but without having to use private money (since it's not always available). Can someone please tell me if the right thing to do is to pull out as much money as I can from this property so that I have some cash on hand for my next deal? I'm a single parent with a house of my own to pay for and I definitely need to stay on the somewhat safe side.

The details of the property are as follows:

Purchase price including closing costs: 76k

Rent: $1050

Taxes: $150/mo

Insurance: $90

Repairs- minimal

Appraised value: $150k

After repairs were made, interest on the loan was made, and I pay my private lender off, I have zero of my own money into this deal.

Any advice or direction would be helpful :) I have two flips under my belt and also own a quadplex with a partner. I've read a million and one posts on BP. I'm definitely not being lazy. I just hesitate. Often. .....and question my ability to make the right decisions and am very worried that I'll make that one wrong decision that will change the game for me.

Thanks in advance! 

 Nicole

[Boyd McClean]

Keep it simple. Find a private lender with IRA money that will loan you money @ lets say 7% for 10 years. You will save on closing costs and if you are prompt with the monthly payment they in many cases will be willing to cash out at a discount after 5 years. Have an other private loan set to go in their place.

My experience has been they will take a 15% discount.

When you deal with banks you are dealing with bureaucracy.  Deal with a private lender and you have more leeway.

Find out in your area who are custodians for IRA's, search the recorder of deeds site for those custodians by name and it will turn up all those that have invested with IRA money.

Contact the mortgagee with a personal letter (hand written) and ask if they would be interested in investing in their community.

Custodians of IRA's have seminars for potential investors go to them and network. Then when you find one to invest in your deal then after about 90 days call and ask "who do you know in your circle of friends might be interested in investing with me as you have." Do you think a bank would do that.

Think outside the box. Just pretend that there was a law saying you could not borrow investment money from a bank, if the need was great enough you would find a way. Also think in terms of fractionalize notes. You need a $100K Mr. Jones says I will give you $50K ask Mr. Jones in his sphere of influence does he know someone that would invest the other $50K.

One area over looked are  women who are professional or business owners that make good money but don't have the time to invest. Look at Meet Up in your area for women groups that  cater to the above mentioned groups.