All Forum Posts by: Chris Seveney

Quote from @Jeff Welgan:

Quote from @Chris Seveney:

Quote from @James McGovern:

Are tiny home communities successful? Is it easy to sell for agents? What is typical margin for builders?

 Note that if you seek financing, its very hard to finance these properties as most conventional and non-qm lenders do not touch properties under 600 or so sf.

Great point and DSCR loans are available down to 400 sq feet and conventional options are available under 400 sq ft with some lenders that underwrite directly to the Fannie Mae guidelines and do not have underwriting overlays. Fannie Mae generally doesn't specify minimum square footage requirements, except on manufactured homes.

For conventional and DSCR investment property tiny homes - they need to be stick built and permanently affixed to the foundation. Manufactured and modular homes are not allowed.

For primary residences and second homes – manufactured and modular homes are allowed, but need to be a minimum of 400 sq ft and at least 12 feet wide and permanently affixed to the foundation.

Hope this helps and reach out if you have any questions!

which DSCR lender goes down to 400 sf?

Quote from @Jack Spicer:

Hey everyone,

I’m in college with a steady internship income, solid credit, but limited cash. I’d love to hear how others financed their first rental when funds were tight. What strategies or programs worked best for you, and what would you do differently?

Thanks for sharing your experience!
—Jack

House hacking is hands-down one of the most common and effective ways to get started when cash is tight — especially for someone in your position.

Most people start by using an FHA loan (3.5% down) or conventional loan (as low as 5% down) to buy a duplex, triplex, or even a 4-unit. You live in one unit, rent out the others, and let the rental income offset (or completely cover) your housing costs.

It’s a smart move because:

(a) You build equity while keeping living expenses low
(b) You gain landlord experience with minimal risk
(c) You get access to better financing terms since it’s owner-occupied

If I could go back, I would’ve house hacked earlier. It’s not flashy, but it builds a strong foundation and opens doors to scale up from there.

Quote from @Callie Mahoney:

Recently saw a company at Sheriff Sale buy a property under a "real estate coaching LLC". Is this a good tactic to appear like a ‘good guy' on paper? Is this unethical?

There are no “good guys” or “bad guys” in how entities are named — just strategy and optics.

Using a name like "Real Estate Coaching LLC" might make bidders or occupants assume it's an education company rather than an investor or fund. That can lower resistance in some situations, but it's not unethical unless it's being used to deceive or avoid legal responsibility.

At the end of the day, the courts, lenders, and experienced investors look past the name. What matters is how the entity conducts business and whether it operates within the law. It’s just branding — and branding alone doesn’t make you the good guy or bad guy

Quote from @Mike St. Jean:

I closed on my property a month ago. I asked my real estate attorney to email me the deed because we hadn't received it yet. I open it, and see that it was a quitclaim. My attorney never mentioned any issue or encumbrance. I'm now concerned of what could be waiting for me. We are in the process of getting a building permit to convert it to a 3 family and later refinance. Now I'm wondering if this quitclaimed deed can prevent either one of those from happening. I'm sure there are other risks as well. What should I be prepared for? TIA

First thing I’d ask is: What did your purchase contract say about the type of deed? If it called for a warranty or grant deed and you received a quitclaim instead, that’s a potential issue.

Second, did you get title insurance? If so, review the policy to see what coverage you have — it’s your first layer of protection if anything was missed or misrepresented.

A quitclaim deed doesn’t necessarily mean there’s a problem, but it does mean the seller isn’t warranting clear title. That can create risks, especially when you go to refinance or sell. Before moving forward with permits or construction, I’d have a title company or another real estate attorney review everything to make sure you're not exposed to surprises.

Quote from @Robert D.:

Hello all, I finally got around to having my LLCs set up through and attorney and it appears I have been left hanging here.

Attorney initially opened 3 California LLCs as well as 1 Wyoming LLC. He suggested we do it this route in which he has done all of his clients that were trying to accomplish the same as I which is asset protection.

After several mistakes in the grant deeds and his lack of communication all the way and getting back to me within a decent timeframe, I made the corrections myself on the grant deeds and turned them into the county, im assuming that they are finished, in other words, they were deeded into the LLCs. 

It’s been over two weeks now since my last email to the attorney. So I’m assuming he’s got better things to do than to help me with the job that I hired him to do. So I am sitting here just wondering what else needs to be done. I can’t really think of anything that needs to be done but then again what do I know? I’m not an attorney and this is the first time doing such a thing as this. Statement of information were also done for all four entities. Everything was deeded as far as I know. Operating agreements were also done. What am I missing here? He told me I needed to come in so that he could finish correcting the deeds which I had already done and turned into the county. So my last email to him was I told that I already took care of it and just to let me know what else needed to be done so we could finish this process. 

Three California LLCs plus a Wyoming LLC sounds like overkill unless you're managing a large portfolio or have complex liability concerns. A lot of attorneys sell these structures as a blanket solution, but they don't always consider cost, practicality, or your actual goals.

At $800/year per CA LLC, that adds up fast — and if you're not clear on why you need all three, that's a red flag. I'd seriously consider getting a second opinion from an attorney who specializes in real estate and actually explains their rationale. You might find that a simpler structure offers the same protection with far less expense and hassle.

Quote from @James McGovern:

Many investors in my area avoid participating in REIAs due to their high price. Is this a challenge in other parts of the United States?

Like many things in real estate, a lot of REIAs started as grassroots, community-driven meetups focused on sharing knowledge and building local connections. Over time, some evolved into more formal, for-profit organizations. Nothing wrong with that in principle, but it does mean rising costs — not just for events, but also for memberships, vendor tables, and speaker slots.

The challenge now is that the value proposition has changed. With so many free or low-cost options available — from Facebook groups to podcasts, Zoom meetups, and national conferences with better content — local REIAs can feel outdated unless they’ve kept up.

I think they still can be valuable if they bring together serious, local investors and provide actionable education — but if it’s just pitch-fests or surface-level material, I’d rather spend my time elsewhere. Curious how others feel in their markets.

Quote from @S Arely Cavazos Serratos:

We provide a great value to investors but sometimes they don't seem open to new opportunities. What approach works best on you?

Personally, I don’t respond well to cold calls. Even back when I worked a W2 job, I found them intrusive and rarely worth the time. As an active investor now, I get approached frequently — and the volume of unsolicited calls has only made me more selective.

What works better? A warm intro, a thoughtful message with clear value, or seeing someone consistently provide useful content. If I’m interested, I’ll raise my hand. Cold calling feels like asking for commitment without context.

Quote from @John Johnson:

Hello, does anyone recommend a particular website / or Facebook forum for note investors to network? Besides here on BP haha

 The Paper trail note investing community

Note and Mortgage Investing Simplified

buying and selling mortgage notes @brett burky

Quote from @John Matthew Johnston:

@Chris Seveney If I can ask you a question. The vertical shaft 2 hour fire rating. Is that an easier code to become compliant also ?

This requires shaftwall to be built around them, this is a lot more expensive than traditional drywall. you can do it out of a drywall or you can use CMU that is fully grouted as well. If you have never done this type of building I strongly would advise against it as you will need an architect to design it but also on your side need someone who can manage it and no how to oversee the contractor - unless you engage the architect to provide construciton services to oversee the GC.

USG Shaft Wall Systems Catalog (English) - SA926

Quote from @Mike Day:

I am considering investing in some notes for the first time and want to know what people think about this idea. Is it a valid strategy to invest in performing first position underwater notes (where the borrower owes more than the home is worth)? It appears that being underwater is not actually a popular reason to stop paying, and not that many people did it even during the great financial crisis. Barring some kind of new crisis, it seems like the risk is probably only a few percentage points higher than loans that do have equity, yet these notes have much higher yields. Especially if you can get a good payment history on these notes, they seem only slightly more risky. Am I missing something? Because I'm thinking of making this a niche.

You're asking the right questions, and on paper, the math can look very appealing with underwater notes — but in practice, there’s a lot more nuance.

First, remember that you really have no idea what the property is truly worth unless you can get inside. These properties often come with added risk: delinquent taxes, lapsed insurance, unknown property condition, and possible code violations or liens. The borrowers also have less incentive to maintain the property, which can deteriorate faster than you expect.

We've done hundreds of notes, and while it’s true that being underwater alone isn’t always the trigger for default, we’ve consistently seen better overall returns — and smoother exits — on loans where the borrower has some equity or a strong incentive to stay. When they have something to lose, they tend to stay engaged.

Foreclosure timelines and legal costs also vary wildly by state, so what looks like a high yield can get wiped out quickly if you’re not factoring in delays, legal hurdles, or damage upon taking the property back.

It’s not that you can’t make money with underwater notes — you can — but if you're thinking of making it a niche, just go in with eyes wide open and build a strategy around low acquisition cost, strong servicing, and legal efficiency.