All Forum Posts by: Axel Meierhoefer

@Wei Jie Yang OK, got it. The annual membership is really affordable and all the perks easily pay you back, especially if you plan to develop a portfolio.

You are basically telling me that you want to cook a gourmet meal but you are not willing to spend money on the ingredients and hope that your guest will not taste the difference. Maybe you should rethink that approach.

@Wei Jie Yang I have found the calculators here on BP work really well. Takes just a few minutes to populate and you get dependable results. I agree that you could create your own spreadsheet to make sure the formulas are correct.

@Wei Jie Yang could you clarify what you mean by "Cadillac of Turnkey companies". I read so many labels that I no longer know if that is meant literally or as in jest :)

Thx

@Amanda Aesho Out of state can mean many things. I am in the process of closing on a new investment in TN and live in CA. That's really far. You have opportunities closer by that you can actually drive to. I can make a recommendation if you like. To be of better service to you it would help if you could give a little more info. I do buy and hold as well, but I have criteria for % down, overall total down, overall price, monthly cash flow goal after all expenses(using and applying BP calculators), etc.

I am not a huge fan of typing, so if you like, we can have a call and discuss

Best wishes

@Somaya Abdelhadi I agree with @Ray Johnson . The numbers you provided sounded strange to me. Just as a very quick reality check, I went online. Here is the link for apartments rents https://www.rentcafe.com/average-rent-market-trends/us/tn/memphis/. Your 9 property average is $840/month. You say its free-standing houses. I suspect  @Joseph Back is right to suspect that you are in the bad neighborhoods. You will need local expertise to have a chance to make this work. As an investor, I would not take this deal, even on the numbers you mentioned. More details would probably only provide more evidence. As yourself: If they are really worth $780K, why wouldn't they rent for more?

Congrats. I can tell you it gets better as you repeat

@Wei Jie Yang the 200% rule is one of the rules for 1031 exchanges. You will either need to buy a property with the same or higher value than the one you sold or multiple properties that add up to a max of 200% of the selling price. That's what would apply to me as I am planning to purchase 4-5 properties in exchange of the one I am selling.

@Wei Jie Yang Thanks for keeping the thread going. I am in the starting phase for a 1031 and have the exchange liaison in place, the current property had the first showing this week, and I have been talking to Ashley. 

Have you spoken to MI about other locations than Memphis? I just bought a new construction deal (not form MI) that will close next week with tenant already in place to move in on the 22nd of Feb. I am tempted to not put all the properties I would acquire from MI using the 200% rules in Memphis but maybe have 1 or 2 in other markets. 

@Mark S. I would look for a lender that gives you the highest % of the available equity and the longest period of time. Normally you could get up to 90% for your owner-occupied home, but not the 100% you seem to be looking for. Fox max amount you might need an appraisal to prove your expected value. Zillow-estimate is a basic idea but does not officially count. Be careful if you live in an area that had a lot of appreciation as many people feel we are entering a phase of flat markets and if your market drops and you max-out your HELOC the bank might lower it if your property value goes down. You might have a hard time finding anybody lending with a fixed rate or it might be high interest%. If you have not already done yet, I recommend watching the videos from Michael and his company "Replace your mortgage". Yes, he put them up for the purpose of people paying back their mortgage faster but they have great educational value to learn about ins and outs of how HELOCs can be used. You might be surprised to learn that using it as a credit card is not so far off, but not in the negative sense that most people use it. I am happy to have a more detailed chat about it if you are interested. I am not a banker or lender or anything but have studied and applied it several times.

@Craig Ebersole, @Bob M. Guys, Kyle's resource is one of the best I have seen and should help you a lot. Lending on rental/investment properties versus personal residence is different and sometimes the criteria are really unfavorable for HELOC on rentals.

One thing I like to add for you guys to consider is rules regarding arbitration. USing one loan to serve another loan. It does not apply if you use the HELOC amount to 100% purchase your investment, but when you want to buy the new investment with a mortgage or commercial loan and use the downpayment from a HELOC it could be seen as a loan on a loan. I am not a banker or lawyer but have been warned several times about it in transactions. You probably have heard that underwriters want to see where your funds are to make sure you can afford your downpayment. If you take the amount it would take and put it from your HELCO into a savings account you have to pay a little interest on the HELOC for a month or 2 but you would avoid giving the impression that you are using one loan to fund another loan.