All Forum Posts by: N.A N.A.

What is your point Lance D.? What does this have to do with the subject?

He does have a job 10 days a month. Every third day, 7a to 7a (a very low salary, great pension for later). The two workers can work alone on these days. However, repairs, payroll, materials & his own labor is included in the improvement (rehab) costs. To make this work, multiple properties and production need to be consistent. A new line of credit is in the making, just like it was on the first dozen. It's much more difficult to obtain but possible. It's all local. I'm just trying to make this stronger and smoother to see if/how production can increase. Add another part-time employee for a third house? The workers left alone can only do so much without equipment. No tool trailer, no climbing on the roof, no nail gun, nor tile saw. You can't pay them to hold up a wall all day so basically the texture, prime & paint stage, and/or tearing out bad areas or old nasty carpet to bare wood. Properties are purchased with cash then paid back with refi/rehab funds for the next to be purchased. It just rotates and purchase money can be out on two at a time if one is rapidly refied. The whole idea is getting there quicker. Less production equals less labor funds needed with the replacement rental profit. I know this can't be done in a short period of time, but when you're replacing the income you had on much larger projects (that were sold, when they were selling) than you are trying to think what can he do to get there quicker.

Lets just say that you have no other choice but to make it full time. No, you shouldn't totally rely on it but if it was your only choice (we all know we have other choices) how would you structure to power thru it? Say you need to cash flow 3k or 5k a month. In the beginning off of labor (quickly) then actual rental cash flow. Now thinking, you have no other choice but to figure this out. How would you do this? You already have a dozen under your belt, but now you have to plan it out for the remainder. You have the skill to complete every single possible scenario of the properties improvements. You now have 7 days a week to knock out these properties. It's now a JOB and not a hobby. How would you make the best of it? No criticizing here, just think it's the only thing with no other options. How would you structure this plan on paper to actually work? What is your plan of action? Now you are buying cheap and paying yourself for man hours and trying to complete as many in a year as possible. It's tricky, not a smooth ride, tons of what ifs, but knowing some you can have ready in a month and some will take three. You have a part-time awesome helper (12.00 an hour) and another part-time (8.00) that can basically clean up, caulk, mud, tape, prime and paint (this guy spends 90% of his time on another house unless you need him as a third person). Now this is a job and you have to buy cheap and still in the end make the same cash flow and allow the same average % rule. I'm typing in a rush so please power thru it.

p.s. - Mike, (if you reply) please don't criticize my questions just think "how could I make this work". I value "all" opinions. I'd like to see it attacked from every angle.

Taz, this is what I'm trying to figure out. I'm going by the surprise of the other bankers and them stressing to me that they won't pull it like the other guy did. Their reaction was "oh my" and "why"? My bills are paid ON TIME as I've stressed in my earlier post, this is how we have obtained loans for years. I'm anal about not dinging my own credit. This is a concern to me and a shock. Why would I want to tell half a story and expect a whole answer? I'm trying to figure it out and see if I can help reverse it. It's important to me. Livelihood...

Taz if Fair Issac states it than is it fact that they apply the rule? I also think every time it's pulled it hurts. None of the new potential bankers said anything about what Fair Issac states. Also Taz, their was no problem and no missing pieces to the story. Why would I leave anything out? It is what it is and I can't imagine why such a drop. This is the reason I'm asking. Would the immediate DTI hurt me this much? Yes, John you are right. Every single point makes a difference.

Chris,

What part of OK are you located in? What part of the REO process are you?

John, I most certainly will write to them. I can't do a thing about speaking to them. An array of recent events sent me over the edge. Sloppy, unprofessional events. I just need to use my better judgement and decide how to word it. A great source just the other day informed us, the bank is 99% loaned out and can't make anymore loans until they free up some money. Not really understanding that side of things, I'm not sure of why. They said all the local branch's can't make a single little consumer note on anything unless they call the regional Pres. This also came from "the source". We've always relied on our scores to keep loans going over the past 10-15 years. I've hated being under one banks mercy and this now has serious consequences. Being loyal to them, has cost us our credit. If we had another line somewhere else, they would have possibly caught it. I've not viewed our credit since we started rental rehabs a year ago. The last person we should worry about hurting our credit, is our banker, right? Now with the lower credit and (you are right on with your guess) and a high dti I'm feeling pressure. Now we've always been self-employed with the exception of one full doc small salary (10 days a month). One bank said they would talk with us if we moved everything to them. Again, at the banks mercy. Another said they would basically expect it too. This last bank is very tempting. If they can give me some type of guarantee (although nothing is a guarantee) that they won't stop us in our tracks, I would be 100% game. I'm crushed our bank has put us in this position. But... not near as crushed about killing our credit instead of protecting us. They should had known how to structure this on our credit under a skill, right? If S. Williams can better explain, it might help me with my letter. Should they had known better than to just do a revolving without setting up as a trade?

S. Williams, you are correct on the revolving. It's all under us personally and I have not a clue you could list it under a trade line. I'll have to figure out the details of this and hopefully correct it with the new lender.

I've dreamed about a 775ish score, thinking this would help prove our stability and give anyone confidence in us, and now look. We do this for a living. It's our main bread and butter. We built a few customs per year, for 12ish years and with the "new" market we quickly switched gears. We've had a great year. Very physical and non-stop, but knowing we are hitting it hard for 3ish years will give us comfort. 100 times less stress than picky, greedy, can't make up their mind, wanting 10 changes a week, but not wanting to pay for it customers. Not to mention, these are still mine and not needing to be perfected for tenants. We absolutely love it. It's what we know, it's in our blood, it's not a challenge, we just love it. I haven't seen DH so happy and relieved of stress in years. We're on the same page at the same time. The stress is all in the financing. It's a constant worry about financing 35-50 small rentals. I have so many question about reaching our goal quicker by increasing volume, but now I'm stuck worrying about getting all the money we need to get there. The thought of paying a high percentage for private funds makes me ill. This means more time, work and less cash flow. We are trying to stay as close to the 50% rule as possible, as quickly as possible. Lots of random early morning thoughts here, hope you don't mind. If I've repeated than I'm sorry, I'm running back and forth to the laundry room and office. It's hard to pull yourself away from biggerpockets. :)

Local lender... 70 total... Within 12 months time. Also, the rapid debt but it was mainly the 10 times pulled, per the other local banks. They said once or twice a year if we were their client with a line of credit. We've never missed a payment nor ever over 30 days late. It just makes me sick, very very sick.

We bought two in January to total ten. I just wanted to add this since I stated eight (2008) then ten.

Thank you for your replies. Yes, it DID hit our score and more than I ever imagined. Our banker pulled it 10 times in 2008. We had ten loans on a line of credit. We've used the same guy for years. We have no other loans anywhere else. Not even a small or car loan. I've now had it pulled three times shopping for a new bank and a new line of credit. The first two said something about it, I brought it to the thirds attention before he had a chance. The processor at the first bank said "why on earth did your bank pull it this many times"? Now with three more hits it's killed it. How long until 10 RE payments made on time, should I see an incline?