All Forum Posts by: Andres Ospina

Hello all, we are currently looking at a property in NJ that will need full rehab work. Previous owner purchased property about 2 years ago, but could not finish the work and left everything as is. Now, zoning map approves lot for 2 legal two family. We noticed during the house showing that there was one one gas meter, and one furnace. Would anyone happen to know who would be responsible for adding the other gas meter? (City or Contractor). Also are there any other permits or fees that I should be aware of when doing this? I appreicate the help in advance

Why wouldn't they give you a heloc on your house, i thought that was easy , i just went in a credit union last week and they told me what i need and stuff, if you have equity in your home  why wouldn't they you a heloc?

HI Sophia,

The answer to your question is simple and straight forward. Start with TD Bank, HELOCs on investment properties are a part of their lending business. I have an application in process on an investment property at the moment. I found them as a potential lender as a result of a Google search. I also have a HELOC application approved on another investment property with a credit union I belong to. These lenders want to see strong credit, verified personal income, assets vs. liabilities, verified rents, occupancy and a debt to income ratio no higher than 43%.Remember though, there are exceptions to every rule (they may extend the limit on DTI).

There are local banks and credit unions that will underwrite these lines of credit. I found other small banks here in New Jersey that do. In addition, some large banks other than TD do as well (their names escape me at the moment). 

Hey BP! Fairly new to the forums and on the fence about this deal-- hoping to get some advice!

I've been negotiating with the seller for a month now and I got the price down to $625k. Initial price was 750k. I've put down a conservative $700k ARV.

It's a duplex with an unfinished commercial space (500 sq ft) on the first floor, and two residential the second and third floor. There is a difficult month-month tenant in one of them (a month behind on rent, always late to pay), and a good month-month tenant who's always early on hers. 

Unit 1: Rented at $2000/month with market value $2400/month

Unit 2: Rented at $1860/month with market value $2400/month

Commercial space can be rented at $1500 - $2000/month

After taxes I'm looking at a 0.75% monthly return fully occupied, which is quite good for this area where appreciation has been well over 5%/year in the last 10 years, brand new units are being built by big name construction companies, and units rent within the week. I can also update the residential units once they are vacant for a healthy uptick in my rent. The downside here being the unit is on a busy two-way road, close to two major junctions where commuters regularly drive through on their way to manhattan.

Assuming the most conservative rental numbers and the worst-case capex expenses, I'd be at a 5% cap rate and a negative cash flow of around $ - 500/month at this price. I could write off the loan's interest against the income I make from my independent contracting business. I'd also have the cash to put 45% down and turn cash flow positive in a year, if interest rates don't fall. Once they do, I'll refinance into a cheaper rate and 100% turn CF positive.

Talks between the seller have gone a little stale. Is this a good deal at this price? If not, how low would you push?

I'd really appreciate some opinions from the pros :) 

Danny

@Andres Ospina I have been using directskip. You can pull lists with them and they will skip tract them for you. You can do your first 500 traces for free. Give it a try here.  https://get.directskip.com/eas...

@Andres Ospina

We use Idicore for our business but depends on what your skiptracing for

Thanks Chris,

Yes I am specifically trying to find owners of vacant properties or non owner occupied when their residence address is not on the tax records.