All Forum Posts by: Adrian Chu

First thing first, research construction cost.  

In Tacoma, I've seen a number of main house + ADU considered as 2 units, so you can just build 2 of those.

Interesting, perhaps it's a different crowd of travelers.. 

Everyone is an investor inspired by Fortune Builders :)

FYI - airbnb is getting hit HARD due to this health situation.  One of my clients own and manage a dozen airbnbs and they are getting cancellations left and right.

 That's the norm in Tacoma these days. 

By the way, I recall getting a few of your letters.

Single Family homes are awesome.  Get as many rooms as possible and rent out each room for $700-1000+ a pop.

Who are your favorite lenders in the Bay Area? Would like to learn more about what their loan programs are like (DSCR, how they calculate DS, rates/terms).

There's no one size fits all. It really depends on what type of loan you look for.

1) Low LTV = First Republic Bank including IO loans for 1-4 units.

2) Max LTV with a slightly higher rate = Luther Burbank, Opus Bank and Chase. Chase can turn on and off the faucet at anytime so it really depends on how much loan volume they need. Once Chase turns on the faucet, it's hard for other banks to compete.

3) Bridge loan = Avid Bank where we talk directly with the underwriter and have a loan approval over lunch or when we leave his office. He is so flexible that we don't want to work with any other banks. In fact, he has extended long-term loans to us in the recent years. I have also used Bank of the Orient for a couple of bridge loans before, but our contact there has left the bank.

4) No doc loans = East West Bank. I heard other Chinese banks such as Cathay and China Trust also do no doc loans, but I don't have first hand knowledge like EWB. 

5) First Foundation is also really competitive in the MFH space.

By the way, we can close a loan on 5+ units in 17 days. For folks who say we need 45-60 days to close a commercial loan, they have no clue what they're talking about. :o)

Best of luck.

 Thanks for sharing!!

Has anyone done a TIC conversion? Want to better understand the process. :)

Who's your favorite local bank for commercial lending options in the SF Bay Area?

It's hard to turn $1m to $500k/yr passive, that's a 50% return!  

That being said, I would consider pursuing multiple avenues in parallel, but you don't want to spread yourself too thin and lose focus.  Some ideas:

1. Take advantage of primary residence loans/tax benefits

2. Do some fix and flips to quickly earn money

3. Re-invest proceeds into long term rentals (stuff that has a balance of cash flow and appreciation) - BRRRR strategy is ideal.