All Forum Posts by: Charles Granja

Hi,

Would you trim or cut down a dead tree? It’s about 20 feet tall. It doesn’t look like it would fall over. I need to do something because when storms come, dead branches fall off and could damage a car. 

Trim- 400$

Cut down- 850$

If PITI was 1248$ a month I would've carried through with the transaction. I received a term sheet from a lender and received a quote from an insurance company that I use/determined property tax. I ended up backing out of this purchase because the mortgage was 20% more expensive and the cost of the loan was 7k more expensive than on a conventional.

Hello everyone,

I reached out to 4-5 lenders regarding DSCR loans and found it difficult to make a deal work, even in areas meeting 1% rule.

Here’s a recent scenario: 

Purchase price: 244k duplex, good condition

25% down 63.5k

Current rents: 2200, cannot raise 

Rate: 7.25%

Mortgage- 1570

Lender fees- 7500$ Origination/underwriting 

5 year prepayment penalty

This didn’t include discount points. I found a lender who would do 6.5% interest with 40% down, but it would come at a cost of 3 points so I ended up walking away. 

It seems that DSCR lending is better for situations where you can significantly improve the property or where you don't mind paying 10k more for a loan + 15-20% increase in mortgage costs each month.

For those that use DSCR loans how have you made it work? Do you balance cash/conventional properties with DSCR so that you are at least cash flow neutral? Are we just at a state in the market where it is difficult for deals to work? Do you use a different form of lending? 

Thank you for the recommendation. 

Rent-ready repairs on a unit or general maintenance requests. Just turned over a unit since this post but have another turnover coming up at the end of this month. 

Hi,

I am an out-of-state investor and had a turnover recently. The bid that I received seemed high so I traveled to see my properties. When I saw the subject property, I called property management because the job would take 2 days to complete but I was being charged 3500$ and the bid was exaggerated, After, addressing this with my property management company and the fact that they were not present for this initial inspection, they said the issue would be corrected. I called again and they said the job would be 750$ to complete, I said ok. I was just billed 1900$. What would you do in this situation? There is clearly a disconnect and I am paying for it, I would not have authorized this work for 1900$ and the property manager knows this, that is why I drove to his location to address the original bid. Also, all materials were available at the job site for clarity. I recently reached out to the property management and contractor for more details but wanted to hear your perspectives.

The work that was completed:

Re-installing doors that were removed but are in the room? Replacing lightbulbs, and all blinds (1-2 hours of work)

Small paint touchups on trim (30 minutes-1 hour)

Fastening a couple fixtures, not replacing (30 minutes)

8 small drywall repairs (3-4 hours)

Replacing 2 transition strips (1 hour)

Replacing 2 outlet fixtures (30 minutes)

Service mechanicals (1 hour)

Replace fridge rubber seal (unsure)

Replace bracket on vanity door, bathroom (30 minutes)

Hi,

Does anyone have any recommendations for a handyman in the KCMO area? 

Seasoned investors will tell you to buy but also have 500 rental properties and access to a plethora of resources that enable them to purchase at steep discounts. They also make less mistakes. They are leveraged and protected by their previous purchases after the 2008 crash. In a market with this much volatility cash is extremely relevant. You could lose 7-8% from inflation, 30-80% of your stock portfolio (current), or 50-100k on a 250k investment with a 4-1 leveraged position (near future). Make sure you understand the risks, most would say the state of the market is very concerning and that we are the top of the market cycle. 

I am selling my primary residence and renting. I am keeping my investment properties and will continue to buy but cautiously. No one knows what will happen with the market. The reality is that house prices are way too high and I hope they come back to earth in the near future so that more people can break-in. 10 years ago I could purchase investment properties for 30-40k in 64132, now the same properties sell for 130-140k. Everyone talks with absolute certainty about real estate because they have made a great deal of money but there are market cycles for every asset class. If real estate doesn't correct no one will be able to afford it in the coming years.

So 10k over list and not paying 15k for assessment fees? Sounds like a good deal if you property is valued at 210k. But is it? How many offers are homes getting in this area? What do the comps say?

If your friend is the realtor they should do a CMA and show you the comps so you can make an educated decision. Alternatively, you could order an appraisal but you shouldn't need to do that. If you are questioning this, I wouldn't sell off-market until you have answers. I'm sure you are fine in this situation but you need to cover all your bases to protect your net worth. Also, congratulations!