All Forum Posts by: Henry Lazerow

I believe a member on this forum has a turnkey review site that may be helpful for you. You always want to be skeptical if the same person is the broker and also in charge of the rehab/original acquisition. It provides opportunity for conflict of interest. A lot of these little providers end up flopping over time.

Another option is buying stabilized rehabbed properties. Where you select your own broker to represent your best interest (help you get best property for cheapest price) and then also select a property manager. A good property management company will be able to coordinate/bill out any repairs for the building and run it "turnkey" for you. 

Do an owner occupant 4 unit with only 3.5-5 down. The biggest advantage will be living free and being able to save the money you would of spent on rent each month. This makes a huge difference in your ability to buy more properties. 

Other then that. Small banks sometimes do 20 down but its a riskier ARM and might not even be available as a complete newbie depends on location, etc. For a non owner occupant 25 down fixed is the safest option.

@PJ Kolnik Lender was Adam Oris with Guaranteed Rate.  Not sure if allowed to post contacts in here so feel free to PM for it. I can not recommend Adam enough, he did an awesome job getting everything prepared properly for the out of state member and approving power of attorney, etc. 

The 2 Chicago owners are going to handle the property management. I did have a property manager lined up but being rehabbed units and a class A area figured it would be a good learning experience to handle themselves at first and then switch to management after buying a 2nd building. 

Excited to have had the opportunity to help a BiggerPockets member buy their first investment property a 4 unit in the eastern part of Chicagos West Town neighborhood. Just closed this Wednesday!

It was a rocky road with the first property under contract the leases came out showing lower rents then we were told and decided to break contract. Worked out being the right choice in the end when we found the perfect property. 

For their first purchase my clients wanted a safe "turnkey deal" the next project they are looking at will be a value add where can input the BRRR method and be on a path to building a large portfolio of rental properties.

Property details....

Gut rehabbed building with condo quality finish in 2011. New roof 2 years ago. 

4 units with 2 in front and 2 in large coach house. 2x: 2br 2ba, 2x: 2br 1ba 

Purchase price: $943k - Gross rents: $7200 with market rate being about $7800

At 25% down the mortgage payments came out to roughly $4600 bringing in a nice bit of cashflow. One owner of the LLC was out of Cali seeking higher cash on cash out of class A properties then can be found in his hometown.

Looking forward to seeing them progress!

Some photos of property....

Rehab finished......

Garden: 

Floor 2

Coach House - Huge Master 

The typical agent when searching the MLS only checks the boxes of Price Change, Reactivated and New. Many consumers also have alerts set up to show these same three terms. By dropping the price even a little bit it will generate many new leads for your property.

@John Vo Use a TIN rather then your SS 

Basically as Brie said income is only part of the approval process talk to a lender they will be able to give you exact numbers for what you can buy now vs what you will be able to buy at the reduced salary, etc. A good lender is a very helpful resource. Maybe ask on BiggerPockets for some recommendations in your city. 

100k should be fine for investing unless you are in very expensive markets. You can also count 75% of rents towards your income when buying a building. For a first investment I always recommend to look for a stabilized fully rented building, line up a good property manager and jump in. You will need to typically put 25% down on the non-owner occupant. 4 units is a great way to start as you get more cashflow then 2-3 units and can still avoid ARM loans, etc.

If you have the right stabilized building, stick to affluent areas and good property management team don't be afraid to invest outside your direct area. Just put a West Town (Chicago) 4 unit under contract for an investor out of California. 

I second @Lumi Ispas peak properties is great to work with! 

Feel free to message me for some more recommendations and provide details on what specific part of Humboldt Park, which makes a large difference when picking the right property management company.

REIA is a great organization for networking you should check them out.

Take major caution at anything set up by a guru. I have ran/audited the numbers by several of these gurus/wholesalers and the comps are often straight up fraud, fake numbers on the so called flips, etc.