All Forum Posts by: Kenneth Garrett

@Mary Joe

The bank will be in first position.  The private lender will be 2nd.  When you evaluating an investment the private lender is typically the only lender.  Make sure the project has equity in it to protect your investment. 

@Virginia Aucoin 

That type of loan will be in second position.  Make sure there’s enough equity to protect your investment, otherwise your giving an unsecured private loan.  Don’t do this, your unprotected.  The interest rate should be 12% or better.  Protect yourself and most importantly your investing in the individual investor.  Make sure they have a track record of executing these types of deals.  You need to vet the individual as much as the investment.

@Mary Joe

I’ve been using private money lenders and have lent myself a few times.  Private Money Lenders take first position on the loan.  They have all the rights as a mortgage company to foreclose.  Make sure your mortgage document has all foreclosure conditions with it.  The note should cover the specifics of the loan.  I know a few private lenders who unfortunately had to foreclose on a loan because the investor could not execute the investment.  You will need an attorney to foreclose and it takes time and money.  

@Jay Sheth

There is no way I’m using the sellers inspector.  It’s my choice and I want an independent inspector who is representing me “The Buyer”.  Of course it’s your call.

@Dan Elam

Send me a pm.  Happy to share my check-in check-out form.

@Tony Zhang

A couple of thoughts.

Don’t rely on the Zillow estimate for value.  Run comps to confirm the value.

As far as the mold, you’ll need to remove it.  There are many types of mold.  I’ve had mold remediated in a number of attics.  Generally in my area $3200.  Sometimes you can clean it up with bleach solutions.  There are many products on the market.  You definitely don’t want to rent it with mold.  That will be a potential issue for you.  You’ll need to resolve the water intrusion as well.  Might be as simple as regrading around the foundation or redirecting the downspouts.

@Jaki Gandara

I have a number of rental properties I self manage in the north and northwest suburbs and one in dekalb.  Feel free to reach out.

@Jennifer Dejoyvor

Based on the potential ceiling height, it would be a storage room at best.  To make it a habitable space, the ceiling height needs to be a minimum of 7 feet for 1/3 of the required room size per the residential code, your jurisdiction might be 1/2.  Example would be a living space is required to be 120 square feet so 40 square feet has to have a ceiling height of 7 feet not sure you have that.  Bedroom code says a minimum of 70 (some areas 100) 1/3 of 70 is 23.3 or 24.  You’ll need an emergency escape window, smoke detector, receptacles, insulation, drywall, etc. Probably way over $2000.  Plus the railing around the opening.  

@Kevin Sabatino

Looking in the panhandle (Destin Area).

@Jesus Sosa

In simple terms, if I use the BRRRR strategy and I am able to pull all my money out and still cash flow $300 or better I consider it a home run. I have no money in the deal, generate $3600 a year and take advantage of all the tax advantages of mortgage interest deduction, property tax deduction, mortgage pay down, depreciation my ROI is actually much better. You can argue with yourself whether $300 is a home run versus $400 or $500 snd so on, but your tenant is covering all your expenses plus cash flow.