All Forum Posts by: Account Closed

I strongly advise against paying any upfront fees for lenders.  Check out my blog linked through my profile. One of my first posts (actually maybe it was my first post) was dealing with this same issue.  The real lenders in your market go to the REIAs.  Start going to them and network and get to know them.  Maybe one of them will refinance you out if they think there's sufficient equity.  Then again, they're going to want to know why you're not just selling it.  Did you change your mind and now you want to keep the property as a rental?  They'll want to see sufficient cashflow.  Do you want to keep it as a primary?  Don't know a lender who would do that in today's lending climate.  Can you not sell the property?  They'll want to know why.  Lenders may be suspicious why you can't wait for the cash until you sell it.  Are you struggling with the expensive debt service? 

I think it's a great idea.  Please remember, however, that even if you own a property free and clear, the bank may still put you through the ringer and could potentially not qualify you for the loan.  Lenders usually want to see a history of 2 years rental history before they can use that to count towards your income.  I'd say your best bet to pull out equity is a small, local bank.  They're usually more open to those scenarios.  You could also consider marketing for owner finance deals where you don't need to qualify for the loan.  Good luck :)

I have two schools of thought on this depending on where I have been in my investing career.  A few years ago, I was doing just a few homes a year, and I couldn't afford a loss.  I had a property that wouldn't sell, so I refinanced with a lender and kept as a rental.  Actually, I sold it on a wrap around, took it back when they defaulted, rented it for a bit, and then sold to another investor, but that's another story...

Now that I'm doing much more volume, and running a true business, I would prefer to discount the property to get it off my balance sheet, even if that means taking a loss unfortunately.  No matter what though, make sure your lender gets made whole.  I've been in that situation as both a borrower and as a hard money lender.  In both cases, reputations were built and respect was gained when lenders get paid back in entirety, even if the project takes a loss. 

I agree with Jon- you're stuck with them until lease renewal or if you can find a way to evict.  It's not easy to evict for trivial items such as pet waste normally though.  This is why I prefer (and I think John also but I could be wrong) month to month leases only.  If I don't like a certain behavior, they get a 30 day notice.  Attitudes change when they realize the landlord has the authority to do that, and I believe the month to month is powerful.  :)

Gotcha.. thanks!

Ann, I guess I'm out of the loop.  Can you point me to some info for becoming "verified?"  Thanks :)

It's been a very exciting few weeks.  So many people have noticed our development that the local paper ran a story on it!

After thinking about your situation more (and not being able to find the edit button for my post-- is that feature gone now?), if you're interested in the borrowing provision of the 401k but want to invest for profits you can enjoy and live off of today, you could contact the current custodian of your 401k account.  They may be ok with you borrowing a portion of it and you could avoid the rollover and potentially higher fees of a solo 401k!  

I did this several times from 2008-2012 when bank lending was even tighter than it is now.  My advice would be to go to several small, local banks with just a few branches.  Talk with the head (in many cases since the bank is so small it will be a Vice President) of commercial lending.  These loans are portfolio loans that they keep in house instead of selling to Fannie/Freddie.  So they don't have to conform and be as strict-- you'll still have to qualify and the property will still have to have good Cashflow and equity though, but they can fudge around some of the hard and fast rules if they want to.  In my experience, these loans will most likely be 15 or 20 year amortization a with a 5 or 7 year balloon.  I'd find out what each bank wants and try to get prequalified with them before you do the initial purchase.  I wrote some articles on my blog on this a few years back which is linked through my profile.  Good luck :)