All Forum Posts by: Andy Schornack

Call Bruce Boeder or Katie Melander. Both are good. Send me note if you want direct contacts but both own their practices.

Thanks for sharing!

A lot depends on what avenue you are looking to refinance into? If you are refinancing with a local portfolio lender it will be a different process than with a Fannie/Freddie process. I tend to see more value in the local portfolio lender but I am biased.  I do see the advantages of working with a secondary market lender but as you accumulate more properties this becomes less advantageous of a path and completely disappears after 10 financed properties. 

In any case, let's look at Fannie's Eligibility Matrix as published in March 2016. Remember you need at least six months seasoning on a property but would encourage you to wait until 12 months.  This gives you some targets for this particular avenue. 

Jeff you may want to look at a local lender in Edmond. I know Citizens Bank has a national profile for how active Jill Castilla is within the community. Likely they will underwrite the loan based on the property cash flow, personal financial profile, and your overall global cash flow. 

My experience as a very active portfolio lender:

- LTV 75-80%

- 1.20 DSCR

- Global Cash Flow > 1.20

- Property management overview (outsourced or self managed)

Sometimes it is easier to get started with a local lender and stick with them. You may even want to use them as a transitory lender until 12 months seasoning is reached and then refinance into the secondary marketplace to lock in a 30 year rate. Other times, it makes sense to go straight into the secondary market.  

Good luck!

Wow, some scary comments on here and some good. Debt as a goal? Hubba-wha!?! 

The goal should always be growing free cash flow while maintaining adequate reserves. It is a very attractive market to drive good returns with low debt costs and good rental demand but we have been on a nice run and cycles do change. Reserves and true cash equity provide cushion for the next cycle.

As property portfolios grow, repairs and maintenance should be systematic vs reactive. Reserves are needed to accomplish. Remember when debt burdens become too large, it will take you out and strip you of your flexibility.

Nothing is good in excess, just don't get crazy. I personally like to keep within 5-10% liquid at all times. This allows me to cover any major unforseen expenses, for instance a roof replacement or heaven forbid another environmental cleanup.

NE Minneapolis is a hot market right now, may be more worthwhile to gauge your target areas for the best value. In any case, good luck on the search!

Good luck Evan!

Try Plehal Blacktopping for the driveway (free estimates). On the retaining wall, probably a landscaping company to handle. W Landscapes is a respectable firm. 

Good luck!

It's hard to tell without better understanding your local market. Here's a bit dated resource but there is some good information in here on costs across the country on new construction: http://www.mnhousing.gov/get/MHFA_1016268  

Costs in general are up from since this report was completed. 

Hi @Tony Lind, you may also want to check out Keith Peters or Paul Johnson at Security Bank & Trust in Waconia. They are actively looking at new deals right now.