All Forum Posts by: Keith A.

@Mike Kalob

 Check with an insurance broker to look into other liability carriers.  Some have 4 property limits while others do not have limits.  I had to switch after going over the 4 property limit from USLI to Hudson which my broker quoted and we went with.

Good luck! 

Thanks for the replies.  @Dave Metsker This is what I think I'd prefer having my name on the deed or use a trust like @Rick H. An estate attorney mentioned I could leave it in his name on everything but mentioned it may be difficult with HOA, utilities, etc. Said if power/utilities were turned off it would be difficult and HOA may require it to be able to lease it. I know you can rent them but not sure how deep they dive on that.

 Also, this mortgage is through CitiMortgage.

I have a property (father's) that I can take ownership of through probate.  The value of the property is a little higher than the mortgage balance but not much.  If I rent it we will make about $200 per month.  It was updated recently with new roof, a/c, windows, etc so should be low maintenance for a while. At least for big items.

 If I take title on the property through probate then does the lender have the right to call the note since it will not be in my name?  Supposedly there is a federal law to prevent this but not sure if the lenders get around it. "12 USC § 1701J–3 - PREEMPTION OF DUE-ON-SALE PROHIBITIONS" "(5)a transfer to a relative resulting from the death of a borrower;"

I would hate to go through the probate process to change title and have them call it.  Curious if anyone has gone through this or has any help or advice.

@Lumi Ispas Your advice makes sense.  Could always make the case to wait longer but money sitting in the bank is just losing value and refi's can take time.  I was thinking it would be easier and have better terms to get a commercial loan if the loan amount was greater than 750K.  Something like the Fannie Mae Multi Small Loan Program.  I am making assumptions since I haven't spoken to a commercial broker on it.

I am familiar with SFH/4-plex purchases and doing multiple conventional loans via cash out refinances. I am looking to move to the next level and purchase a small apartment. i.e. 12+ units depending on cost per unit and return. I have liquid funds and also other funds tied up in paid off properties. The question is whether to buy something smaller with the current liquid funds as a down payment or pull out more to focus on something larger with more down.

For simplicity let's say current cash for down payment is 250K but with some time could be double at 500K.  Assume also that this is pure down payment and 6 month reserves are already taken care of.

It may be personal preference but thought I would throw it out there to see if there were pros/cons from people with commercial multi experience. 

Jim Robertson I am thinking the same but thought to see what others think. Not all units are created equal so having a specific goal acquiring a specific number would need to be based on the return associated to them.

Everyone talks about acquiring many units/doors but is there a preference if you are comparing two buildings where one building has high rents but low units and the other has low rents with high units.  Assume they both cost the same and have the same expenses and return.  

For example a 20 unit at $500 per door versus a 10 unit at $1000 per door.  Logic would say if the return is the same then go with less tenants but curious of the pros and cons.

Any input is appreciated.

Insurance in Florida for properties requiring wind can be a cash flow killer. $5000 seems pretty steep but not sure how large your property is and its age including roof age.

What I always do for mortgaged properties whether through Citizens or another carrier is to make sure you get a favorable wind mitigation inspection.  If you have an old roof then it will be tough.  Also, most agents quote a 2% wind deductible and $1000 hazard deductible.  Most lenders allow at least 5% wind deductible which I use and also put $2500 hazard deductible.  Verify that the replacement cost is correct as well as I had a case where they were way over what it would cost to replace the home driving up the price.

Hope this helps.

I went through the same thing trying to cash-out on the fifth property.  They mentioned it was a new guideline as well and was caught by the underwriter at the end of the process and refunded my appraisal. 

The broker explained that they can do a rate/term refinance on 6-10 but no money can come out. So what they explained (for free and clear properties) was to use private money and properly put a note/mortgage on the property and make at least one payment (need a copy of posted payment) and then they could do the rate/term refinance for the exact amount the note/mortgage.  I am in the process of putting a note/mortgage on the property using a private lender friend of mine and will try to do the refinance shortly after.

Great job on the update and look. Some initial bug items and suggestions.

Bugs:

-In the profile "Latest Forum Posts" there is a non breaking space " " after the name.

-My profile pic in the top right shows the red circle with an asterisk in it.  No mail exists.

-When I click on Profile Views from Dashboard I get a 500 error.

Cosmetic Suggestions:

-When viewing a post and scrolling the page, the blue top navigation has a transparency percentage and you can see through it.

-The vertical flow is nice except that top ad bar makes an ugly break in the flow.  I know it keeps the lights on but maybe for "Pro" members you could lose the top ad.  :-)