All Forum Posts by: Matt Crusinberry

@Jeff R., I would say that the 70% rule is just that... 70% of the ARV, while fix and flip is going to be geared closer to a profitable number that you may be okay with. I wouldn't recommend using the 70% rule (personal preference) for properties that ARV over 250k. An example would be flipping a house in CA for $1 million dollars, 70% rule would suggest 700k with a 300k profit (obviously rough numbers w/o closing cost). While this would be an awesome deal and if you could land something like that in this market good for you, but the probability would be scarce. I would flip it for 80% or 90% of the ARV if the numbers looked like that. Really it comes down to what you're willing to accept as a return. I hope this helps, and good luck!

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@Web A., I am sorry if this comes out wrong, but why would you want to wholesale a listed property? Once the property is on the market, then it's available for all to see. Unless your able to get it under contract before others, or unless it's listed on FSBO, I don't see this is as a profitable route as you may be using time that could be used towards finding the properties that aren't listed yet. Other than going to the HUD and trying to double close. I wish you the best of luck because I know it's possible!

@Nicholas Borda, Auction properties are usually done in cash, but some auctions (e.g. auction.com) will allow you to get funding from a bank (rare from what I've seen). And to answer your question, this will depend on what you want to do with the property. I recommend you contacting a local bank and finding out their rates for your area, and check with different hard money lenders for your specific deal. I personally don't recommend going with a business loan or a personal loan, but again I would suggest to just call up the banks and ask. All of these are dependent on your background (i.e. credit, how liquid you are now or cash you have to put down, and history in real estate investing, etc.). I hope this helps and good luck!

@Jim Watkins, HML don't lend to owner occupied. My suggestion to you would be to just off load it as is, or speak to a bank to see what kind of financing is available (much like you stated before with a HELOC). Also you may also want to put this on a different discussion. Good luck!

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@Kathryn Bennett, If you don't have a mortgage on the property yet, you are able to put your "soon to be" on the house (however this may not be an option). On a side note, I agree with you... Let Dave and his followers do them, and you do you. Although I'm a fan of Dave's, he's not for me either (as per his debt ideas). Sounds like you have a plan, and you're continuing to learn the market and the investing game. I personally think you're moving in the right direction, keep it up. Good Luck!

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@Mike Bovay, 55% to find your NOI, so debt would come after that. Also self management will help change that number, but I highly recommend you run your numbers as if you had a PM (just in case).

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@Mike Bovay, I use 55% for expenses as a rule of thumb for a quick evaluation. I actually use this number even if the seller's pro forma says it's less (most likely will). If you are given actual numbers and it's higher, go with the higher number. I hope this helps, good luck. 

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@Adam L., Each of these have different paths you can take, depending on your deal. I recommend you check out each individually. Good Luck!

@Ernesto Hernandez, I recommend contacting the local banks that are near this particular property, and preferably the smaller ones. Good luck!

@Kathryn Bennett, If you have an infinite return, and it's cashing flowing decently, then just put a HELOC on it. You can either put your fiance's name on the first property before getting the HELOC, wait until you have 2 years of income from your new employment, and/or wait until you have 2 years of rental income from the property to help in supporting the loan (or whatever your lender is requiring). You could also put the property into an LLC as opposed to putting his name on it as well, but you would just be back into the situation your currently in, with lesser terms when you go to refi (due to LLC). This would factor in for your long term goals and your ability to only acquire a limited amount of properties in your own name.