All Forum Posts by: Jesse Waters

@Anna Buffkin

The bank is First Citizens. For this loan they are lending to LLC, commercial (5+ units). There seemed to be some flexibility in the deal. They told me that when I walked through the door 3 years ago they wouldn't lend to me, now (the same people across the desk from me) they will.

I also do business with Guild Mortgage.  I have 5 mortgages, so its hard for me to get residential mortgages (4 or less units) for less than 30% down.  It sets me back to put up down payments that high, however, it does help cash flow.  When you talk to Guild talk to Rick Starnes at their NE location.  He's a friend of mine & has a good understanding of the investor mindset, although, he is still limited by the rules of his bank/Fannie guidelines.

Its funny that you are in Greenwood investing in Columbia, I was thinking that Greenwood has potential, small town feel, big city aspirations, or perhaps that's the majority of the state???

@Darren Eady

I most certainly will pass it along. There are a few items that weren't previously discussed. First, they are lending to LLC, which I have held for 3 years and they wanted to see my experience & history as a land lord. The loan officer in this case is also a RE Investor as is his wife, so, I felt that passing his first line test spoke well for the potential of this deal.

It might be some time before I bring one into close with them, we are partnered up on a rehab and have our next 2 purchases lined up via seller finance.

Welcome@Tracy Selfridge to BP, great to see other investors from SC on the site.  

When I look at a property I assume 100% financing to see how it looks.  True, the cash flow will increase with a higher down payment but there is a cost, more money out of pocket, and I haven't really seen any properties that I have looked at that drastically improve more than a small percent by putting a larger down payment on the property. 

Just my 2 cents worth.

So, I have been trying to get lending sources lined up.  I had talked with some boutique lenders such as B2R, La Quinta etc, and only coming out with high rates & less than favorable terms.  Last week I got some paperwork in the mail from the bank that I keep my business checking account at.  Since I was going by the bank I decided to drop by the bank & face to face with the folks there.  

After I took care of the paperwork I asked to speak to their commercial lending rep.  

We went through the normal introductions.  When we got down to business,  I was floored by the terms that they are offering.

Under $500k 20 year am with 7 year balloon for 4.6%.  

The big kicker here is that they are only asking for 85% LTV, DCR of 1.25.

Most other banks/lenders I have talked to want something along the lines of 70-75% LTV. By cutting my down payment requirements in half from the 30% I had been paying to 15% it would seem that my buying power has just doubled.

@James Wise is spot on, lost of things to consider about large tree's, but I wouldn't not buy a property just because it has a large tree, it would depend on factors like the ones James mentioned & if you can get some consideration from the seller for the tree.

I would side with @Andrew Jordan on this one.  If you hold fast on your position you might both lose the deal and lose any chance of doing business with this guy again.  Missing out on $10k hurts, but getting $10k is better than not getting anything at all.  Work out a deal that everyone is happy with & everyone wins, perhaps you will get repeat business from this buyer.

I agree with @Jerry W. on this one. I always report my expenses exactly as they are. Generally, when your loan goes through underwriting they don't just look at your taxes, and you underwriter is halfway decent they understand the use of depreciation and certain allowed write offs that may show a tax loss but still create positive cash flow. Also, it has been my experience that by putting a larger down payment on a property the lenders will go ahead and count what that property is going to earn, in their estimation, towards my income, mostly offsetting the impact to DTI, or any negative impact that a purchase would have on my DTI. If you don't have a larger down payment or a lot of equity for a property, they usually want 1-2 years rental history on it.

Hope this helps.

For me, both. Up until recently my company matched 6% with a 4% profit share. I'm in the oil & gas industry and we just lost the 4%, but it would be foolish to pass on a free 6%, as soon as they make their contribution thats 100% ROI on my money.

Also, I have been able to use my 401k as proof of reserve funds during the underwriting process on my recent few purchases.

Hopefully, I can retire early on my RE stuff, then when I hit "retirement" age pick up income from the 401k & social security (if it still exists).

I have read a good number of them. Rich dad got me going in the direction of REI. After a while the books seemed to repeat themselves... Same thing new format. I found some of his "advisor" series books to be pretty good, though mostly not written by Kiyosaki himself. Both the "ABC's of real estate," "the real book of real estate" and "Loop holes of Real estate" were all full of good info.