All Forum Posts by: Bryce Y.

Walk away seems to be the only option.  Be thankful you found this out before entering a deal with this person.

Their expense number seem a bit low as mentioned.  I have rentals close by in Desoto.  For 1% rent/price I'd prefer an older home in a better neighborhood, ie north Dallas.  You will be dealing with a better tenant class and more appreciation.  

Yes, perhaps I misspoke a bit. What you described goes on a lot more than you think, it's just not advertised. I work for a HML and I've seen this happen. Negotiating a lower rate and points is possible if you bring a proven track record (with them) plus volume. I just don't think it's reasonable to expect this right off the bat. If going rates are 4/14%, and you get them down to 2/12% for example, the question then becomes can you find cheaper money? I think most successful investors (like yourself) probably could.

 I usually agree with everything you say, but I'm going to have to disagree here.  To my knowledge, most HMLs have investors whose funds they loan out.  They make their money on the points and pass on most/all of the interest to the investor.  Lowering their rates would mean investors would have to settle for less yield.  Not necessarily a problem, but lowering the points will cut directly into the HMLs profits.  Is it worth their time/effort to earn 1-2 points?  I'd guess no...

You can definitely still do them.  I'm in Texas and I'm closing on one tomorrow.

It seems like there is a lot of time and effort spent on the design of each new build.  How feasible is it to create a "standard" floor plan that you can simply tweak as necessary (or just use one that you've used before)?  

This was a good podcast. I think Mehran has a good business model that has worked well so far, but imo the elephant in the room is what happens if/when the "boots on the ground" business partner is no longer there.  I'm not suggesting Dawn will do anything unethical but sometimes life happens and the relationship comes to an end.  It seems like  much of the success of the operation hinges on the local partner with skin in the game, otherwise he would just be another out of state investor using a PM.  Not that there's anything wrong with that, but as @Jay Hinrichs pointed out the current way he's doing it is superior.  I'm curious as to what's plan B if the local partner is no longer in the picture.  Liquidate the properties?  Find another city/partner?  

Have you verified the ARV? I'd bet dollars to donuts he's giving you an inflated or overly-optimistic ARV.

Assuming you quit, how difficult is it to get back in the workforce?  

Heh, good timing.  I just made this post.

http://beta.biggerpockets.com/forums/49/topics/132946-silly-underwriting-requirements