All Forum Posts by: AJ Exner

The BB one looks really good, I was seeing low-mid 7s and with no-PPP that's pretty good these days.

I wouldn't be too scared of some of those fees. Sounds like you're getting good value by eliminating that PPP. 

The demand is there and there is plenty of opportunity all across NWA and especially Bentonville.

The growth there will continue with the development of the new home office and the revamping of the in-person work force, I think it could be a great idea.

Happy to connect if you are looking for help!

Hey Troy,

If you are investing in OH, Kiavi and some other big name HMLs might not be the best fit because of minimum loan amounts and minimum purchase price.

Ohio, along with AL, MS, parts of MO and a few other places can still get some solid BRRRR opportunities below 50k, which is (unfortunately) below the minimum allowed purchase price for a lot of groups and might even run into minimum loan amounts.

Kiavi not only has that, but they also push back if the rehab is over the purchase loan amount, which can happen quickly up there.

Otherwise, they are a great option if your deal(s) fit within their parameters. Plenty of other options though that I would recommend based on the specifics of the deal.

Happy to connect and help where I can!

Hey Jacob,

Plenty of lenders would be happy to help you get started! There are  3 factors that they would want to know and get a feel for before they would fund on this one.

Obviously with this being your first deal (on paper, on your own), they would want to get a sense of what kind of risk they are looking into. They would want to know your credit score and your liquidity to get an idea of your borrower profile. Especially in a bigger deal like this, they might want to make sure you have reserves on top of your cash to close in case the deal takes longer than anticipated or goes sideways at all once you start the rehab.

Besides your FICO and reserve requirements, you might also run into concerns with this being in Florida. A lot of lenders are bowing out of FL right now due to insurance costs and risks there, so I would anticipate some hesitancy from a lot of lenders which would likely reduce the initial leverage that they would be willing to give you.

All that being said, should still have plenty of options! What kind of leverage are you looking for on this venture?

Good luck!

Hey James,

How many units specifically are you looking to build on this parcel?

Hey Yakir,

I broker a lot of HMLs and there are a LOT of great lenders out there that will provide you with great products and great service. However, the biggest thing is having a good snap shot of what you are looking to do, because the process will vary wildly based on what you are looking to do.

For example, if you are a square peg and you are looking for something that fits what you are trying to do (fit in a square hole) but you are currently trying to fit in a circle, you are going to get frustrated and be ineffective because that is not where your deal is supposed to be. You might even get upset at the circle hole for not being a fit, but that is not what they are trying to do.

The circle hole would be perfect for the circle pegs, but given what you are trying to do, I would get a good idea on what you are looking for and maybe ask, 'who is the best fit for XXX'. That way you can optimize your time and energy and make sure you can get the deal done.

Happy to help where I can, but there are a lot of great choices out there based on where you are looking to invest, how much its going to be, your experience, and how long you think it will take.

Good luck!

I've got a lot of clients down in Birmingham, and understanding the impact of value, appraisals, and seasoning as well as what to do with properties below $100k is something I am very familiar with.

Would love to connect and see how we can help!

Hey Matt,

The biggest variables I've seen with groups in the 5-8 space is region, rural vs. urban/suburban, and loan amount/price per unit.

Most lenders want to focus in certain regions in that space, or even certain areas within those regions. They might also calculate DSCR a little differently within those regions, so you might want to ask that up front.

As well, make sure to ask up front what their minimum loan is for a 7 unit as well as if they have a minimum price per unit. Maybe the property you are looking at is above any concern, but just something to keep in mind.

Good luck! Certainly some good 5-8 unit deals out there if you can find them!

Hey Richard,

Fortunately there are plenty of HMLs that don't do any 'retainers' or 'due diligence' fees up front and would even only charge for the appraisal on the HUD. It really does vary by lender and it might not hurt to utilize a broker if you've experienced this a couple of times.

I would say that the points + $2000 is about right, but again, usually out of closing. I've seen the up-front due diligence on larger deals or more complex commercial work but not on your standard HML residential projects. Plenty of groups are more straightforward and can even have some unique quirks towards the payment schedule and other differentiating factors

Hey Christina,

There are a few that can do cash out refinancing at values that low. The issue is that you will want to keep good tabs on the fees because you will often run into minimum fee sizes and so you won't have as much wiggle room or negotiating power at loans that small.

Happy to connect and help if I can, certainly to walk you through the numbers!