All Forum Posts by: Jibu V.

@Mitchell Snyder

I would double-check your expenses. CapEx, repairs, and vacancy assumptions seem a little low. Also, you may want to add in a property management fee of 10% to future-proof.

@Ryan McGhie

You don't have to use 70% of ARV but that's what the bank will finance on a cash out refi (possibly more). The $104K acquisition loan is replaced by the refinance. Take a look at the refinance section of the report. It says that you still have about $103K cash tied up in the deal. That's from unwinding the first loan.

Assuming ARV, rehab, and market rent are accurate, this deal would be much better at 70k. The current purchase price puts it at 80% ARV minus repairs. I'd want CoC to be mid to upper double-digits on a BRRRR.

If you're looking to BRRRR, it looks like there is an error in your calculation. The refinance should be based on the After Repair Value. In your case, you said this will be worth $250K. If you cash out refi for 70%, that would be a $175K loan and not an $81K loan. The cash out refi loan would replace the acquisition loan.

Try rerunning it with the revised refi numbers and see where you come out. 

It sounds like the scenario they are responding to is for a refi within their seasoning period. If you are trying to refinance within 6 months of purchase, it’ll be challenging (not impossible) to find a lender that will refinance based on appraisal value. Their response is more in line with a refinance based on the delayed financing exception.

Definitely talk to a few more lenders.

If all of my real estate purchase and mortgage documents are signed electronically, then I don’t see why lease documents aren’t just as legally binding. 

Also noteworthy - I did have to present a valid lease in court during an eviction process in order to support the rent that was owed. It was an electronically signed lease that I printed out. It was upheld. 

Thanks for the additional info.
Are there any fees involved for signing leases? Can it be exported as a PDF? And can use our own lease or does it need to be created within Innago?

It looks like it takes 5-6 days. You can expedite it for a fee. For me, I just need confirmation that the payment was initiated by the tenant timely, and it’s easy to see that in Cozy. The tenant can also set it to autopay.

Cozy.co is what I use for any properties that I self-manage. You’re right in that there is no app, but the browser version is optimized for mobile and keeps you logged in, so I don’t mind it at all. 

I checked out Innago after it was mentioned above. One of the differences I saw is that Cozy does not charge anything to make payments electronically, whereas that one does. 

www.cozy.co is a great website to self-manage rentals. Cozy can also be used to advertise the property, which syndicates the ad to multiple other public real estate websites. The prospective tenants can submit the application and pay for the screening directly through Cozy. This way, you not only avoid dealing with paper applications, but the prospect has already set their account up on Cozy. If they are approved, they can easily transition to make payments electronically via Cozy.

As far as ideas for obtaining leases, you could reach out to a few local realtors and see if they'd provide a copy of the lease they use for their clients. As well, you could reach out to a few leasing offices within the municipality that your property is located as a prospective tenant and obtain a copy of their leases for review. The more reputable apartment complexes will have had their leases vetted or drafted by real estate attorneys familiar with local laws.  Compare the different leases to see what's in each. Also, you'll want to visit your city or township's website, or call them to find out about their landlord/tenant laws. Some places have very strict rules on the licenses/certifications needed prior to renting out a property, as well as the disclosures that you are required to make to new tenants.