All Forum Posts by: Scott E.

You must have changed industries. Because as long as you stayed in the same industry and there were not large gaps of employment, a bank shouldn't give you a hard time about changing companies over the past 2 years.

Anyway I agree with @Greg Scott. You need a couple more opinions.

I always recommend you talk with a big bank, a local credit union, and a mortgage broker. Somebody should be able to write this loan.

You will need ~$4,000,000 to buy this 30 unit complex. Do you have that kind of money to get into this deal?

(I appreciate your confidence but even if you do have the $4M+ liquid, this deal is too big for your first one. Start smaller. Buy a fourplex. Learn how to underwrite the deal. Learn how to negotiate a good deal. Learn how to get the financing in order. Learn how to place tenants and manage tenants. Then scale up to larger complexes.)

An appraiser is going to look at homes with similar specs that have recently sold in the immediate area.

So naturally I do the same. But I also pay close attention to what is currently for sale.

Lets say you have a comp that sold 6 weeks ago for $400,000 in your neighborhood. But a very similar home in the same area is currently for sale for $375,000, it has been on the market for 70 days, and it still isn't selling. This one might not be considered a "comp" yet but it is an indicator that the neighborhood is trending down.

I also am very mindful of finishes. What type of tile, paint, or backsplash you choose wont necessarily impact your appraised value. But it will impact perceived value. I've had several homes sell for over appraised value because I was offering a finish package unlike any of the other homes in the neighborhood.

Not sure if that answers your question lol. But hope it helps.

 Looks like he bought it 10/10/2022.

Not trying to call you out but this is incorrect. I've used several hard money lenders (just closed on another loan on Wednesday actually). And they definitely require you to close in an LLC. You also need to sign a form that states you plan to use the property for investment purposes and have no intentions of occupying.

Sorry you lost your job. That sucks.

Your post is so broad and generic that it makes it hard to give advice. The more detail you give about your situation, the easier it'll be to give some direction here.

For example - How much money do you have in the bank? How much money do you have that you're comfortable deploying into real estate investments? What are your investment goals? Do you have any experience managing contractors? Any interest in getting into renovations? How active are you able to be with your real estate business once you do land a new job? When you do land a new job, how much disposable income do you expect to be bring in to be used for investing? Are you looking to "get out of the rat race" or are you planning to stay in Corporate America for the rest of your working life? How much equity do you have in your current REO? What exactly is the cash-on-cash return on those properties right now?

You get the point. There are an endless amount of ways to answer your question unless we have more info.

Don't take legal advice from a real estate guru. Talk to an attorney.

If the duplex is really worth $650k and you can buy it for $550k, then you need to focus on capturing that profit.

Buy the deal for $550k. Figure out the short term financing. Get it cleaned up if needed and flip it for $650k.

With this business plan you will have a way to pay off your aunt and your father within a few months. And you will probably walk with $50k-$60k in profit (after commissions and other misc expenses).

Of course if I were in your aunt and fathers shoes I'd just take the property to market myself. But it sounds like they're trying to do you a favor and maybe would appreciate the ease of selling it quickly and off market to somebody in the family...

Great post. Some of my best deals were the deals that weren't obviously deals on the surface. One story stands out the most for me...

It was a hillside property that was infested with mold, rats, squatters, and septic problems. It had sat on and off the market for literally 9 years. Nobody in town wanted it. But I saw through those gross factors. I knew all of those issues could be fixed with time and money. I instead saw a big flat lot. I saw a decent floor plan. I saw incredible views. Bought the deal and after ~18 months of rehab it was my most profitable flip to date

Just want to say I appreciate everybody's responses above. I knew there would be some valuable perspective on this topic.

Seems like everybody is in agreement that commercial real estate is in trouble (unless there is some intervention like James described, which seems like a sound solution to me!) 

Maybe it's too soon to consider ways to 'take advantage' of this pained market that we are slowly entering.

All I know is that in 2008 I was just a few years out of high school. I was in the real estate business (mortgage loan officer for Countrywide) but I was still too young and naive to take advantage of the opportunities that the 2008 recession presented.

I'm hoping that this time around I can be more prepared...

@Carlos Ptriawan@Nick Rutkowski@Account Closed