All Forum Posts by: Steve L.

Stupid question maybe?  Why doesn't the person with the 150 million committed put up the 10 million?

I am not sure about Chicago and what is public record.  In California, I could have my title company pull all sales in the last 12-months that are public record.  See which lenders did loans in the association and call those lenders.  

One very good tip for this method.  

There is a big difference to banks between "cash-out" refinance and a "rate-and-term" refinance.   So it might be smart to put loans on properties above your total cost (possibly "friendly" loans) to make sure you don't get any cash out upon refinance.  

I use this method for most of my acquisitions.

My own cash, line of credit, private party and temporary financing make the acquisition.  Once I get 10-20 properties stabilized I will refinance them to long(er) term commercial financing (as a package), I usually have 1 or 2 package refinances in process at all times.

Best method ever. Every so often the bank pre-pays me to buy a positive cash-flowing house.  

...one at a time.

If you have a W2 or long-term business incoming financing 4 is relatively easy.  You can do up to 10 with reserves and experience.  

After that you can do seller financing, private party loans, portfolio loans, commercial financing.  

This topic has been addressed many times on BP.  

But I would suggest you think about Property #1 first.  A lot will happen by the time you get to Property #8.

Theft happens.  The cost of doing business.

Even if you have video evidence it is pretty hard to get the police to do much about $1,000. 

Hope you get them and maybe your property back?

I think this is an interesting strategy.  My answers:

1. You can 1031 exchange a property as long as the value is greater and the debt is greater.  You can also trade for less but you have to pay some taxes.

2. Your strategy doesn't factor in market cycles or appreciation, which is fine. If a market appreciates taking on debt and acquiring more properties accelerates the strategy.  If a market depreciates owning none/less is better.  I would continue to buy properties until you get to 4 conventional loans if it were me and if you want to aggressively pay off after that, I would do it than.  

3. I am a fan of debt, especially at these rates.  Putting cheap debt on a property and paying it off super fast is a bit counter intuitive.  Say you have 4k of closing costs on an 80k loan and you pay it off in two years. You are only amortizing the 4k over 2 years instead of 30.  

4. 

Pros:

- It's a conservative strategy that is safe

- It gives you a clear goal and doesn't require a lot of external factors to go right to be successful

Cons

- It takes a long time to see the fruits of your labor

- You incur a lot of transaction fees (1031 exchange, loans, payoff, new acquisition)

I would like to see included a goal to buy the house 20-30% under market value.  That would super charge your strategy and gains in my opinion.  

Check out the SDCIA.  There are lots of opportunity to flip within the San Diego metro area.  It is very competitive but it is a very big area.

I really don't how it is relevant at this point.  If the agent broke the rules what ramifications do you expect to help your position?

1. Are you happy to pay 88k?  

2. Do you really think the listing agent would ever admit what they did/didn't do to the Seller?

3. Do you think the Seller will somehow lower their price 8k?

You complaining and making accusations is going to stop them from ever doing business with you again.  

I have been in your shoes many times with agents. They are all lairs to some degree. Your job is to make the best offer you feel comfortable with and not think about it anymore.  

I have thought an agent was bluffing and missed a deal I would pay way more because I was testing them.  I have also moved my offer up in a highest and best scenario when I was the highest offer by over 10k.

Your goal should be to have them like dealing with you so much that they give you last look on all the properties they can.  You'll win some and loose some, but the path you are taking right now isn't helping anyone.  

Determine the cap rate for other mobile home park sales that are similar and nearby.  You could start on loopnet or call some commercial agents who specialize in parks.  MobileHomeParkStore.com also has some parks.

Use existing NOI / the cap rate. If you want to know what it is worth after you make improvements you would use pro forma NOI / cap rate.