All Forum Posts by: Arpan Patel

First off I wouldn't recommend HM for your first deal as it is very expensive. Secondly they don't typically like newer investors because of the high payments and risk of the property not working out due to management. However, to answer your question the rates are about 10% for 6 months. They all find a different way to get there but there you have it. Some lenders will have yo put in 10-20% of the total cost of the project in the deal as your contribution. They all have different funding criteria for what a good loan looks like but usually it is usually something like they will consider it a deal if the all in cost of the project is 70% of the ARV. There is typically some type of property evaluation fee they charge so they can do their homework on your deal (300-1000).

To answer your final question, there aren't really any tricks to it, just be overly prepared. Know everything backwards and forwards and be confident. Remember, they are already investing in your area so you aren't teaching them much about the area they don't already know. They are just checking to make sure you know it as well or better than they do. I would also partner with someone who knows the game a bit more so your credentials look better to manage the opportunity. 

I hope that helps!

Market research and then throw it into the rental property calc on BP and see what it spits out. That is what I would do. Market research has been well covered on this site but comps, intrinsics of an area, population trends, employment trends, etc.

depends on what products you are looking for. It also depends on which strategy you are working on and the dollar amounts. lastly, volume is a consideration as well. There are others but those would be the main criteria outside of the normal rates, interest, fees, structure, etc.

This is where you will need to hit the streets. Talk to local professionals or financiers as to what strategies are working and try that. Furthermore, maybe visit a grocery store and just ask people what is going on in that community. Lastly, talk to the local precinct and village offices (especially building and permits) to get an idea of how business is done there and how safe the area is. Hope that helps 

Agreed. We employ the BRRRR strategy and keep rotating capital. You could do the same and we do split 50/50 with investors. You could also try flips after a while and keep that rotating as well. There is more risk for that type of investment though but nonetheless it is a recurring model. Also, maybe ask what returns he is looking for and maybe just purchase a MF and see if that resulting cash flow would satisfy his needs then make that the target and walk down that path. Probably start with what he wants and then find either the most effective way to get there right away or take the longer approach with other strategies or a mix over time and try that. Many options on the table for you.

Depends on the area and comps. What are the other higher priced homes that sold in your area and around the same parameters of your home doing to get top dollar? Then try and do something similar and you should have a strong case for any refinance rebuddle. I hope that helped

Maybe hire a management company that can handle it for you. I have a few people out this way who have done this and it works well even after they are paying a good amount for those very active and hands on services. Can save you a bunch of time and it'll get done right if you manage it well.

Agreed above. Get yourself a cushion and play the slow game. You can succeed but the margin for error is higher and you won't be setting yourself up for the best chance of success.

I wouldn't and we don't advise people to do so. If you are making money today then just keep managing the asset so it'll make money later. We don't model appreciation of rent growth or value increase due to factors outside of our control. DCF to track back to NPV I would say don't make or break a deal, they are just nice to know in the long run. If your units aren't cashflowing today then all else doesn't make sense.

no you don't however you will needs for a down payment. Also, the amount of money you need to put up will be different as well. Many people have hundreds of mortgages so you know it is possible to have more than one. Conventional is still a possibility and so is private lending. Good luck!