All Forum Posts by: Thomas P.

Levi Graziano Are you still doing the meetup? If so, I may join you this evening.

I have been driving for dollars lately and found some good potential properties.  I have found phone numbers for the owner, but it goes to a message saying the caller is not accepting messages at this time....every time.  I have a potential address that the owner is living at now other than the property she owns.  I plan on mailing the person, but I'm curious what letter template or wording are you using that is working best/getting the best response rate?  

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We love to hear from those smarter than we are!  What would you do?

You have 17 SFR rentals. You are tired of managing them yourself, but to hire a property manager would hit the cash flow bottom line too much for you to stomach. You decide to sell 5 for a net profit of $131,000 to lessen the workload. What do you do with the $131,000 assuming you want to stay in the SFR space?

Do you:

A: Tuck the cash away ready to ponce on the next downturn 

B: Buy more flips while you wait 

C: Use the equity to pay down/off, let's say 2 of the remaining rentals to replace the cash flow you lost and take out a business line of credit to fund future flips/acquisition

D. An altogether different and brilliant strategy you thought of all by yourself!  Defend your answer!

does anyone have any experience with winning an auction and then not performing? What were the repercussions? Did they charge you a fee, a penalty? They do not ask for a credit card when making offers. Just wondering if anyone had this situation

I've read and read on the HELOC topic of paying things off faster than a mortgage using a HELOC, but I'm not sure I've got my answer so I'm going to pose the scenario to the BP community:

Let's say we owe $57,000 on an LLC owned rental. It's on a 5 year balloon, 25 year amt at 5%. Payments are $514/month. Year five is coming up May 2017 and we will have to refi. My question is, if I paid the house off and took out a HELOC for the payoff amount to cash out (assuming I can find a bank willing to do a HELOC on a rental property), it looks as though I could pay the house/HELOC off faster, around 10 years, if I just kept making just above same payment I am making now of $543/month. This is a assuming a HELOC of 10 years fixed at 3.5%. This versus getting another 5 year balloon, 25 years amt at 5% and having to pay the refi costs.

Is my math wrong?  Even if it's not, is their a better vehicle with a better combination of cashflow/paydown?

@Eric Jones

I don't really get your math because by my calculations, a HELOC does indeed work out better.

On a amortization schedule, you are paying much more interest at the beginning than you are on a HELOC. On a HELOC, more of the same payment goes to pay down principle.

@Justin H. What loan to value is BBT doing on that 15 year fixed rate product?

Tom, Id be curious to find out who your lender is. We are in the same boat and are having trouble locating a lender locally who will do 15 or 30 year fixed, LLC owned, cash out refinancing at 80% of appraised after repair value. We are in Knoxville, TN.

B and C for me for the same reasons Brit mentioned. I like the B a little better because the risk/reward is better. My B tenants tend to take of the property better which lowers my maintenance and repair costs over time.