All Forum Posts by: Jody Sperling

I've bought two properties cash. The first property I used $60,000 of my own money, $25,000 in private money, and $18,000 in credit cards. When the rehab was complete I took a $30,000 loan with my bank to repay the private loan.

On the current cash purchase, I used $7,000 of my own money, a $25,000 private loan, and a $50,000 private loan. When the rehab is done, I'll borrow $140,000 to $150,000 on the property from a Credit Union.

In both cases, the underlying value of the home is greater than the loan I'm taking from my banks, but I've spent enough time talking with the people I know, that I know I can find private lenders when projects arise. You want to get comfortable with asking friends, relatives, and relatives of friends if they would consider loaning you money for a real estate investment. I've had to collateralize  my loans with property, but that's the cost of business, and I'm confident in my numbers and work, so the rehab has always landed where I needed it to.

Offer high yield on loans, and if you need to broaden your network, the best question you can ask is, "Do you know anybody who would be interested in loaning money for a real estate investment?" Somebody always knows somebody, in my experience. Best of luck!

If you plan to buy retail and you don't want to move your primary residence, look for the worst house in the best neighborhoods. You'll have to pay twenty- to twenty-five-percent down because it's an investment property.

An often more effective strategy is to move to a new house and rent the one you previously lived in. Then you have access to lower interest loans, only need to put down 5% and have the added benefit of shopping through your own eyes, meaning your future renters will be as comfortable living in the home as you are.

We've done that twice now, and it's been tremendously impactful. Best of luck!

Priced correctly, short-term rentals have amazing income potential, but they're so much higher touch that for me, they aren't worth the effort.

That said, Texas is an amazing state to build a short-term rental portfolio and if you had a half-dozen or more in close proximity, the cost of hiring good management could make it appealing.

All of the people I know who have short-term rentals have said the once way they fail is the cost of housekeeping. It's hard to get a service that does the cleaning and maintenance cheaply enough, and profits tend to be sucked out of the property through the constant churn.

It's a great opportunity, and you should jump on it. If you plan to keep it as a rental, you should at least have an informally written and signed contract assigning duties and responsibilities, but if it's a flip, nothing extra is needed. Best of luck!

I've seen this discussion going around on the forums and the Facebook page. I read through several threads and all I come away with is to wonder why anyone cares. There's enough to go around. I've had more opportunities than I have money to capitalize on.

Sure, it's possible Blackrock's behaviors are hyperinflating the market, but we're not chasing retail as investors, and if anything, the inflated real estate prices make our portfolios read more robustly. As I see it now, the only reason to even think about Blackrock is to provide some excuse for why a person can blame someone or some business for their inaction.

Wealth building through real estate can be a snowball that rolls uphill. Best of luck!

Increasingly, I work outside the banks until it's time to refinance. I can't pretend to understand why a bank will refinance my purchase once I own a property, but they won't finance before I own it, yet that's been the case every time.

If you want to buy property without a bank because you have cash on hand, find properties that you can afford with the cash you have or can raise privately. My last two investment properties came from cash on hand plus private loans.

Its cheaper without the bank anyway, as in most cases you can find a property to buy with cash that you can rehab and repay your private lenders for and still get a loan at 75% LTV without keeping any of your money in the deal.

@Allen Zhu, my bank holds their own loans rather than selling them to Fannie and Freddie. Because of that, they do not limit the number of loans they will issue.

The catch is, it would scale too slowly doing it that way because my bank also won't allow me to obtain more than one traditional loan per year, and they have an extremely low appetite for Debt to Income ratio.

For that reason, I deal with the commercial lending side more often at this point. That said, in your case, where you already have ten, the opportunity to add is more natural.

I'm not a lawyer and cannot give legal advice. And I think the contract of your refinance most likely states that you will need to live in the property for one year following a refinance. That said, if your main concern is the bank issuing a due on Sale clause or anything similar, there's likely nothing to worry about. If you're paying the bills, the bank is making money.

Now, you likely won't be able to get any type of primary loan product if seeking to buy a larger house meaning you'll need a minimum of 20% down at closing, and your interest rate might be higher, but those shouldn't stop you from moving forward, I wouldn't imagine. Best of luck!

This may not be a long-term solution, but I know there are banks out there offering 1st Position HELOCs to convert mortgages, and I've heard of a bank that will bundle three houses into a HELOC like this. If you did something like that, you'd open up an opportunity to purchase at least three more doors before having to find alternative mortgage solutions.

That said, All my rentals on mortgages are with local Omaha banks, because I'm local to Omaha, and they have no limit to the number they will finance for me. So an easy workaround is to build a relationship with a local credit union or bank that is willing to hold their own loans. Then you have infinite possibility. Best of luck!