All Forum Posts by: Anthony Chara

If you don't go already, you should join a local Real Estate Investing Club in your area. If you're close to Minneapolis, I suggest you check out MnREIA. Ask the people there for referrals to attorneys that can assist you with these transactions or members that do these types of transactions. Also, you can reach out to my syndication attorney, Jillian Sidoti, too. 

35-40 Year AM. No Balloon. Up to 85% LTV. 4.6% INT including .5%-.6% for MIP.

Technically, Omar, you're not even supposed to tell people the amount you're looking to get them to invest (i.e. $30,000). That's based on the SEC's rules, not even Bigger Pockets. If you don't have a good SEC attorney I'd like to recommend you reach out to Jillian Sidoti.

First thing Jacob, NEVER tell a broker on your first call or two that you're looking for Seller Financing. What the broker hears is, "Hi, I have no money. Do you know any Sellers that will give me their property?" Also, if they can't figure out how their commission will get paid, they will generally not be open to discussing Seller Financing on your behalf with the Seller. Yes, these deals can get done in every market, but they generally work better in non-hot markets and on smaller properties. They also work better after you've created a rapport with the Seller directly.

Hi John, I'm actually in St. Thomas today looking at some properties. I don't know if this person will be able to help, but she's showing us some condos today and may have a lead or 2 for you. 

Patrice Johnson
patricekj at gmail dot com

You don't have to wait any time to Quit Claim the property into your LLC. However, the best thing is to just buy it directly into the LLC in the first place. If you buy a 5+ unit property, this is the norm. If you are only looking for 2-4 units, see if you can find a lender that will allow you to buy it directly into your LLC. There aren't that many out there that will let you do that, but they do exist.

Hi Neil, there are some valid points being made on both sides for you to buy or walk away from this deal. Here's my 2 cents:  First off, last time I checked my calculator a $12,000 return per year on nothing down is an infinite return as a few people pointed out. On the surface, that sounds like a good opportunity. One thing you need to double check though are the true expenses. Sometimes, people don't include a management fee or setting aside reserves for maintenance and repairs down the road.

Does your estimate of $12K a year include you paying someone else to manage the property for you? If not, subtract 10% of the collected rent a year from your $12K figure. Even if you plan on managing the property yourself, you STILL need to subtract that fee just in case you change your mind in the future and decide you no longer want to manage it yourself.

Second, if you don't  have a reserve acct built in to replace things over the years as they wear out like paint, carpet, flooring, roof, water heater, ac, etc., then subtract another 10% of the annual collected rent from your $12K of projected cash flow. 

If you have already subtracted those amounts, then this could be a good deal. You'd be pocketing about $300 per unit per month. However, if you didn't take the two items above into consideration, then after you do the math, you'll probably walk. Just because you can get 100% Seller Financing, doesn't mean you should take it if the $12K you think you'll make isn't $12K after paying for a PM and setting aside reserves.

Sounds like you're on the right track with your reno plan. Only other advise would be to talk to at least 3 sources that confirm you can raise the rents and how much before you proceed.

Also, don't be afraid to raise the rent. You don't know how high you can take it unless you try. I've know some people that haven't raised their rent in over 4 years, because they don't want the turnover. They don't get it that they're leaving big $$$ on the table, not to mention that they property is now under valued and not worth top dollar. Not that I mind buying them when they are ready to sell!!!!!

You answered your own question, Adnan. When you stated that you are "looking at real-estate as a business rather than hobby", means to me that you should start buying apartments which are greater than 4 units. When you buy apartments, you are actually buying a business that produces a stream of income.

My 2 cents anyway, but I'm very biased! lol

@Chris L. is spot on. There are some banks that will loan on deals like the one you're describing above Johnny. Most of those lenders are small, local banks. If you have a track record of previous success, they will usually loan you money, even if the building is completely empty. We did that with a 94 unit property in Kansas last year. Completely empty. Talk about not making the DSCR. We had a negative DSCR!! LOL

You should give Chris a shout-out too. If he's interested in funding the deal, he will probably require less paperwork and blood samples than a lender.

Good luck to you Johnny!!!