All Forum Posts by: Ali Horbach

Hi Samantha. I am in Sarasota. It's been hard to find deals that pencil for me but I underwrite a bit conservatively and they are out there. There are some great REIA and exchangers groups in both Sarasota and Tampa that I would connect with. Happy to connect with you as well if you are looking for some commodore.

Thanks Steven. On my last loan the bank would not allow me to transfer the deed to a LLC without the loan being able to be called due. I was not aware of that until close to closing. Does quit claim avoid that or would I just need to be sure the lender would allow for the deed to be transferred?

Hi, I am sure there are lots of posts on this but it seems I am always getting conflicting opinions. It is so much easier to finance in my own name vs LLC. What are the best ways to protect yourself from liability? Do you really need to purchase in a LLC or are there other avenues that get you as much protection (eg umbrella insurance, trusts) if you purchase in own name and then protect after? I just went under contract on my second small multi- family. I have always purchased in my own name in the past but trying to do things better moving forward. Thanks in advance!!

@Chris Mason thank you. Yes this is inline with what I am discovering. The lender will not allow me to take title in an llc or trust or they can revoke the loan. If I would have started the process as a loan as taking title in the llc the rate would be higher than what I got which is 3.5% 80% Ltv on an investment property (duplex)

Maybe it would have made more sense to take a higher rate and be protected but I was not aware I could not close in the llc. Note taken for the next one.

I have a meeting with an estate planner this week to run through options to protect myself.

Appreciate everyone’s thoughts. When I was younger I had a portfolio of a half dozen rentals all in my own name! Really stupid looking back but As we get older we get wiser and have more to lose! Love the learning process!

Hi- I will be closing on a duplex this month and wanted to move title to a trust or LLC post closing however the lender is telling me I cannot do that per the loan docs. Rates were higher for LLC and Trust. Probably should have confirmed that earlier as we close next week. Any other options to protect myself and not own this property in my own name?

Curious as to others processes for onboarding existing tenants that you are inheriting with a purchase.

Would love to pick up a few nuggets from others systems.

Thanks!

@Jason J.

Hi Jason. what type of assett class it is?

I have been leasing retail for 14 years and run across this often. We always require the potential tenant to submit a letter of intent along with financials and sometimes their business plan (for start ups) Financials could be as simple as a P&l or snapshot of assets/debts to start. If we move forward in negotiations we would then require full financials such as tax returns and credit check. Sometimes it is more seamless if you create your own letter of intent with your preferred terms and then have the tenant mark it up with their comments. Might be easier to compare this way and will also include the business points that are most important to you such as lease term, rent, maybe personal guaranty etc. If they are national tenants or strong franchises they typically have their own form they will use regardless but I have found it very helpful to have our own form ready for the mom and pops. I would visit the locations of their existing businesses if they have so you can see how they are run. Also which of the potential tenants is the best co-tenancy or will have the less cost to build out and also to demo if they don’t make it. Also which do you see as more Amazon proof and viable for long term. Finally do you think that tenant is a good fit for a long term relationship or do you see any red flags early on. It is always costly to have to release a space. Something a lot of tenants don’t realize. Happy to talk further if I can answer any questions for you.

Hi Following onto this thread. I am seriously seeking a 2nd home/STR rental near a ski area. I flew out to do some driving last month but time was limited and only investigated Park City, Sandy, and Midway. Would love to connect with the Utah agents on here to discuss some options. we spent some time near Brianhead last year. I might be open to that area as well. Thanks in advance!

Thanks @Account Closed. #1 noted! 
Ideally I would like 25% with no points and at 4%. I have only 5% debt and plenty of funds. I would think there should be better options out there but haven’t gotten traditional financing on multi fam in many years. 

 Curious what you all would do. In contract on a duplex investment property. (it is too close in proximity to primary  to ever qualify for a 2nd home and is currently rented) Here are the financing options, all 30 year fixed. 

1. 30% down at 3.25 % no points

2. 20 % down @ 4.5% ; 5 yr prepay; 2 points

3. 20% down 5% 2 points  

The Cash on Cash is very similar @ 11%  for option 1 and 10% for option 2. As well as equity payback period @ 9 yrs for option 1 and 9.42 for option 2. It is a difference of $20,880 over 5 years (length of projected hold time) in interest or an extra 34,500 out of pocket now. My gut tells me that I can do better by reinvesting the $34,500 into another property and taking the lower down payment option but what if we end up holding the property past 5 years. Also what are feelings on a 5 yr prepayment penalty? being as I underwrote the deal as a 5 yr hold it didn't concern me terribly but it would mean not being able to refi any cash out. Option 3 is slightly higher interest rate but we could refi the property in under 5 years. Both leases expire this year and are under market so there is growth in the property. 

Thanks for reading! Love to hear all of your thoughts!