All Forum Posts by: Henry Clark

My brother looked it up.  If your single and around an E5; its about $1,100 to $1,800 tax free housing allowance.  Better than the $800 I guessed.

My brother looked it up.  If your single and around an E5; its about $1,100 to $1,800 tax free housing allowance.  Better than the $800 I guessed.

Under your business name.

Do you have a Car?  Take a small $2,000 loan out against it for 2 years.

See if you can pay using a Business card of your company.

You will get two bumps, using the above.  You might pay $300 of interest over the two years, but not a big deal.

All of your vendors, give them written instructions on how to turn in transactions with you to credit reporting agencies.  Dollar size doesn't matter to much for now.  Keep checking in with them, and out on your credit reports as needed.

Sit down with your banker and go over your credit improvement plan and get ideas from them.

While in the service try this.

Option 1:

If your living on base, move off to an RV.

Use your housing pay to pay for the RV and lot rental.

Example:  Numbers don't really matter, as long as they work for you.

Go to an RV park.  Find one for sale you like.

Used RV $30,000;  Lot space $250, Electric, Sewer.

Pay down as fast as you can.

Financing.  As your banker how much down and what the interest rate is.  Ask for no more than a 5 year note.

What's your off base housing allowance?  Example use $800.

Monthly payment, do the expenses of $250 above.  Pay the remainder $550 down against the loan.  Lets say you stay there 2 years and pay down $6500 principal per year.

You have a used RV your bought 2 years ago for $30,000 which unless damaged is still worth around $25,000.  You have a loan for $17,000 left.  You make money, without much invested.

Option 2:

Same as 1 above, but rent a room out for $300 a month.  Charge them $150 of the lot/utilities, more than half.  Do the numbers.

Eat on Base.

Option 3:

You decide to stay in, then move up to Houses or Condos.

Who do you sell to?  Explain it to a new incoming soldier.

Best wishes either way.

Start Small and make Your Big Mistakes Early.

Step:

1.  You must get a subdivision of the property from the city.  Otherwise your bank or his, can't do anything.

2.  You will incur legal fees for Abstract costs, ours requires an abstract and does not allow Title insurance for a subdivision.  Also surveyor.  About $5,000 total depending.

3.  Check with City first on zoning.  Example: minimum site, road site allowed or grandfathered for barn, is there a close enough fire hydrant to the barn.

4.  Have your brother check if he can build in this barn and how much and what is required.  He will probably need an engineer to draw out the barn and do certified drawings.  How much?  Sounds simple to finish a barn, but the city will require engineered drawings.  It will probably be cheaper to build a new barn.  Example:  Someone has to certify the footings meet code.  Does it have footings.  What's the frost free depth for the city?

I would recommend your brother does his steps first and make sure he wants to do this, before you go the time and expense.  Good luck.  Love older Stone barns.

1.  If you refi, do it with the bank who will do your next investment step.  Other banks don't like or will not take a second mortgage position.  This forces you into taking cash out and going through another refi.

2. If you make your next investment with this same bank it will be easier since they already have your equity tied up and more importantly know you and you finances.  It's a headache working with 4 banks.

3.  Bank loan cap rate.  The Fed sets for each bank it's loan cap rate.  Could be $1mm per customer or could be $100mm; depends on their size.  Make sure your bank has a large enough loan cap rate to fit your needs.  Actually don't go with the largest bank.  Get a mid level bank so the loan officer will be there in two years and you have a relationship.

4. Your in the Real Estate business. Do your PMI calc and this would be your lower limit of taking cash out.

5.  Sorry, but I have bad thoughts about California, luckily your there and can assess the climate in your specific locale.  What devaluation can you take on your home, if your extended on loans?  Are you one law, one riot, one tax, one corporate HQ move,  one fire, one water restriction, one whatever; from your home being devalued and being under water.  Realize this is not an optimistic look, but I would factor that into how far would you finance.

6. If your financially strict, you might pull out your max loan level and park the funds. (not in bonds or the stock market). This makes it easier to move with new assets. For example; an SBA loan with 10% LTV with $100,000 is $1,000,000 investment.

7.  I would consolidate all loans under one Bank.  It would be bad to have equity with one bank and be under water with another; that forces you to refinance during low valuation periods.  Also less paperwork.  

Your starting from a Great position, so determine your risk score.  Wealth conservation or Wealth generation.

1.  Ask for owner financing.  Explain these lots might stay on the market for 3 years till they are sold.  Ask her to pay half now and the rest at the end of three years or when sold.

2.  Banks don't like taking second positions, so the above hinders getting a loan from them.  You may need to foot the upfront 50%.  Or do thirds by property. Your first payment would be for lot 1, owner financing on Lot 2 and 3.  

3.  You can sell but you would have to put a subject to closing.  Most buyers will steer away without even talking to you.  If you don't tell them, your messing with their dreams and their timetable.  If it doesn't work out you will have some pissed off people.

4.  You should have a commercial lender already that knows you so your question above should be to them on your financing.  

5.  I'm actually more concerned with your first time developing.  Have you got all of the boxes checked off.  Are there covenants either through a subdivision or city ordinances?  Can I put a trailer in the middle and devalue all of the properties?  Water, Sewer, fire hydrants, Electric, sidewalks, storm drainage.  Are/can the lots be subdivided into the 3 one acre plots?  Our county requires minimum 2 acre buildable lots.  Property to the middle of the road doesn't count.  Road access approved?  Is there a required time limit to build, or can I let the lot go to weeds?  Before you only cared about building a house. Someone else had to check the above off.  What's in your sell contract to reduce your exposure and can you make it enforceable, with defined penalties?  Are you in the county?  Have you done a Perc test or validated there is water?

6.  At 5% interest, can you cover the cost of these lots if they sell every 6 months?  How about every 12 months?  Whatever your market area demand is.

Please don't answer all of the questions above to me, I'm just throwing out the need for a City/County discussion.

Sounds like a home run.  Just check the boxes with the city or county.

@Connor Duff

Call Allen Langston

At Azeria

This is phoenix specific. 

@Peter Lee

Recommend you go with a contractor garage product.  You will get more $ per sq ft.  Let them worry about security. Make sure the overhead doors handle 14 foot clearance. This is a great product in a large city.  Hard to find a spot zoned and small enough for small contractors. 

@Ray Hauser

Costs about $3,100 per traditional storage unit.  This about $15 to $20 per sq foot.  This is for the entire building structure erected.  Does not include land, site prep, roads, fence, etc

@Kyle Bryant

Are you still studying site or have you built?   If still studying let me know town or road location and I will take a look at potential.  Happy thanksgiving.  Getting ready to go golf after 25 years with my brothers hope I don’t tear a muscle. I’ll check if you responded later. 

@Frank Hinck

Happy thanksgiving

Down near San Antonio.  La Vernia.  Enjoying the weather down here. Anyone looking for a development project down here.  Give me a yell. Can’t turn your brain of when your driving, looking for projects.  Will be about a $1.5mm Storage project with another $2nm potential housing development.