All Forum Posts by: Joe Freeman

 Sounds good, I'm reaching out now!

Hey @Rick Zavala glad to hear this! I can get you connected with a couple different lenders that would be able to shed some light into DSCR loans. I'm a local Realtor here in Chicago with Jameson Sotheby's as well, so would like to connect and see what your goals are.

Propwire is the best way to go if you're not looking to pay the monthly fee for Propstream. I could help you run comps, I have access to the MLS to help you as well.

The prior owner should have provided the documents they had on file for the previous tenants. Do you know by chance if they are on month-to-month leases or long term?

@Phillip Trepp

Hey Phillip, glad to hear you're looking to fight what the market is giving us here! I'm a licensed Realtor here in Chicago and focus on the North/Northwest Chicago as well as the suburbs. Shooting you a message now.

@Fatima Bassett Hey there, I'm familiar with creative strategies/seller financing you can use to do everything the right way if purchasing a seller-financed multi-unit property. Not sure if that was what you were referencing. 

There is also now conventional financing that allows you to put just 5% down on 2-4 unit properties as well, so you don't have to go the FHA route necessarily.

@Fernando Lozada With studios some of my clients have found a lot of success in MTR by renting out to traveling nurses and flight attendants.

It's very important also to make sure you know any and everything about the HOA for that studio because typically there will be rules and regulations that could cause some issues for you wanting to rent out the studio. Whether there is a rental cap in place for the HOA, or possibly they don't allow rentals at all. If they do allow rentals though, next question should be what types of leases does the HOA allow.

Happy to share any of my experiences with you regarding managing condo associations here in Chicago and some of the issues/concerns owners have with rentals in HOA's.

Make sure you run your numbers using multiple exit strategies such as LTR, MTR, and STR. Cap rate isn't something you should focus on with a 2-4 unit property, focus more on what you are coming out of pocket each month to cover the remainder of your mortgage payment. If you're coming out of pocket let's say $800 per month for your mortgage, think of how great that sounds, even if it's not profitable right away, you're building a cash machine you'll reap benefits from for years to come.

The days of the 2-units rent covering the cost of your mortgage are  over, and I would say focus on appreciation and the cash-flow you'll receive after you move out of your unit and rent it out. For example, if your mortgage is $4,500, and 2 of the units cover $4,000 of that, when you move out and rent your unit for another $2,000, you'll be cash-flowing at least $1,000 per month and gaining appreciation while your equity goes up.

I would wait 3-5 years before you begin looking to live elsewhere, rents will have increased quite significantly in that time, and you have the opportunity to refinance to a lower interest rate, ultimately leading to more cash flow.

Best bet is to look around the neighborhood for the type of styles comparable properties have for their front doors then go from there. If you've had success with going outside the norm of the neighborhoods similar to where you are working in the past, then by all means go for it. Obviously, like others have mentioned before your budget also needs to be factored into the equation. 

If there happens to be no comparable properties to the subject property, then I would make sure to ask some agents or clients of recent sales in the area on what factored into their decision and bounce ideas off each other. Hearing others perspectives makes way for new creative ideas to come to you, so definitely worth a shot as well.