All Forum Posts by: Ken Calvin

Interested in hearing about anybody's experience with them!

The consensus is issuing a 1099-INT works, whether or not it's mortgage-style secured by real estate, am I right?

The thing is we want to make this as easy as possible for our private (family/friends) lenders. If we just have to send them 1099-INTs, they just report that income on their tax return and we deal with the rest of the paperwork. As far as 1098 is concerned, it's supposed to come from the lender but we'd rather not make our private lenders confused figuring out how to do that.

 Not yet. I hadn't asked rates for a while. What did they offer you? 

@Anthony Thompson If you know anyone doing 30 year loans under 6% (non-recourse), I would love to know!

A few days ago, I found a post in a regional investor's FB group that I'd like some opinions on:

What do you do to find out if it's legitimate or if it's potentially someone harvesting information to perform identity theft? We exchanged a couple emails and the communication style didn't give me the feeling that it's from the face on the FB profile. Also, on the FB profile, the people engaging on his posts are from multiple countries using multiple languages. What do you guys think? What is reasonable to ask for to help with his legitimacy? 

Still not yet, waiting for rates to fall below 6%. What rate, LTV, and what not are you offered?

You're in a very unfortunate situation, it's the risk that we involve ourselves in when using hard money or bridge loans. If I was in your position, I would talk to people you know to see if they'd be interested in lending to you, aka private money.

As far as closing a loan with them, that has not happened yet.

See my post in this thread

I've done this and it does not require seasoning. I purchased with HML in SMLLC. Did rehab and rented the house out. 6 months later, I deeded the house from LLC to myself. Then, I did refinance. After that, I deeded it back into LLC. It did not require seasoning at all. The only thing that held us up was title transfer, I think the county is slow or something. They have a "verified through" date and it took about 10 days before new title was recognized so I could close the loan, and then ~10 days again to deed back to LLC.

A couple things to consider. 

First, if both of you are planning to grow your real estate portfolio, individuals can you have max 10 financed properties to fit in current conforming loan guidelines, even if someone else is on the loan. This includes title being held in LLC with 20%+ ownership, I believe, but check with your lender and maybe some other lenders as well. If you and your partner structure your deal together like this, I think you can collectively have 10 properties. But if one partner is on one financed property, you can collectively have 20, but that might not be a partnership anymore.

Second, if you are going to be the primary person on the loan, which means more responsibilities, you might consider having more rights or ownership in the LLC. I don't know much about how personal guarantees work though.

Here's something worth considering. You take on the loan individually and your partner applies a junior position loan on top, so your partner is a debt investor instead of an equity investor. Then, on your next deal, your partner takes the loan individually and you'll be the debt investor.