All Forum Posts by: Brian Mitchell

Investment Info:

Large multi-family (5+ units) buy & hold investment.

Purchase price: $350,000
Cash invested: $45,000

First REI! Purchased in early April 2019. This 5-unit came with renovated rooms, new siding, and roof. Closed it with one unit vacant and will be able to fill that likely before 5/1/19. The property is a 10.9% cap but there is room for improving expenses.

What made you interested in investing in this type of deal?

The revenues made sense, plus I was able to get a small amount of seller held financing.

How did you find this deal and how did you negotiate it?

MLS. I used area comps to justify my price. It took a couple of sit-down meetings with the seller to come to an agreement.

How did you finance this deal?

Bank Financing w/ some seller financing.

The basic meaning of insurance is to transfer risk from one entity to another.  We started purchasing insurance as early as the time we began to drive a car!  Most people are familiar with home and auto insurance because it's something they've had for a while.  Business insurance may be different as this is usually gained later in life after starting a business, or investing in real estate.  In May we will talk about the Business Owner's Policy (BOP) and all the coverage's associated with it.  We will discuss property coverage triggers, enhancement endorsements like Sewer and Water Back Up, and the importance of avoiding Co Insurance Penalties by insuring your property to value. 

I look forward to seeing you in May.  Thank you Jason Lamoreau for presenting last week!

I need a presenter for June, July, August, September.... If anyone is interested let me know.

-Brian

Hi All,

Everything is a go for tonight at Buffalo Wild Wings!  My 10am bank closing got moved to 3:30 so I should be there on time.  If not, Jason Lamoreau will take the lead as he will be guest speaker tonight.  Thanks Jason!

Brian

Stay tuned for the May meetup info!  Hope all is well.

@Benjamin Biellon. Yes it is

Coming from S. Maine.  Can't wait!!

Great question!

Hello!

Thank you all who came out to the March meetup last week.  A huge Thank You to Bob Langworthy on his excellent presentation about taxes and how it relates to your investments.  Great work, Bob!

In April, Jason Lamoreau will be talking about what he does, building inspections.  Jason owns Maine Inspection and has a couple teams of inspector's checking over buildings for prospective buyers.  I've worked with Jason personally and can vouch for his work.  He will talk with the group about what his company does and the technology they have to do the job.  We will have a Q&A session, too.

I hope you can make it!  Please think of a person who might benefit from this meetup and bring them.

Best,

Brian

@Nathan G. When in doubt, lawyer it out. Good call.

Hi All,

I have a deal under contract which will encompass some seller held financing.  Both myself and the seller are looking to have something on paper and are trying to work this out together.  Below is my draft but feel I should add more language to the interest rate section to protect myself if I pay off the loan early.  Anything else I may have missed?

                                                                                                     PROMISSORY NOTE

2/9/2019

Total Amount Borrowed: $25,000

XYZ, LLC promises to pay John Doe TWENTY FIVE THOUSAND DOLLARS 00/100 ($25,000), 60 months or sooner with an interest rate of 5%.

MONTHLY PAYMENT/PREPAYMENT PENALTY:  It is generally understood that XYZ, LLC will make monthly payments to John Doe  at a minimum of $471.78.  There will be NO Pre Payment Penalty at any time of XYZ, LLC chooses to pay any extra payments to the loan as to pay it down the balance sooner, or pay the loan in full prior to the end of the 60 month term.

Signatures...

Note: I may decide to make the seller second on my mortgage, however that is TBD.  Certainly, wording around that would need to be there if the seller requires it.

Any suggestions?  Additions?

Thank you!

Brian