All Forum Posts by: Logan Drew

 Hi Fabian:

First, I will say that the fact that you asked this question means you come from a good background where you value ethics at least enough to feel bad if you cheated on a test or in a game.  You can be commended for that.  To your question...  If you have no intentions of ever living in the new property, then it is an investment property.  It is fraud to state otherwise to get better pricing.  The entire market (rates/ pricing/ guidelines) is built on risk and contributing to the breaking of the system due to misrepresentation is not to be taken lightly (and is not taken lightly even though it is known that it is difficult to enforce).  Consider it like taxes... would you lie to save money on your taxes?  I hope not from both an ethical and legal standpoint.  If you don't get caught, it's still not right.  Everyone will appreciate your honesty after the fact because it helps the system continue to work correctly for future generations.  I'm sure you'll also feel better knowing you did the right thing.

Hi Austin! Congrats on your new job in Pittsburgh. My thoughts will be in agreement with @Jeremy T.'s. I am a native of Pittsburgh 23 years there and have lived in SoCal for the last 11 years cutting my teeth in the mortgage and real estate fields. I would say that you are in a great position to house hack a 2-4 unit in Pittsburgh. You can most likely end up with a few buildings before you leave there if you plan your steps correctly. Start with a 4-unit using an FHA program. Let me know if you need guidance on what neighborhoods to look at for great cash-flow, good entry prices, and safety/ qualify of life. I'm sure Jeremy has some good input on that as well as he is still there in the 'Burgh.

I too will be acquiring some units Pittsburgh for cash-flow within the next year to 3.  It's a great market for that sort of thing.  Worry about investing in SD when you get back so you're not complicating your move/ career move.  Pittsburgh has easy entry for investors and great potential with the right due diligence.

Good luck!

I got the same impression from 'John Botros'.  He used terminology that was outside the norm and tried to get me to submit a deal to him a few times (having seen my posts on a deal and reaching out to me to try to get me to send it to him).  He could never answer the questions I had for him directly (or with any accuracy showing he knew what he was talking about) and his offer was too good to be true... so I stopped responding to his emails and he went away.

I agree, he should not be on here if he is not legit.  I can't say for sure if he's a scammer and would never say that about someone without knowing for sure... but my spider sense went off and I ran out of there before spending much time on him.  From what I gather... his product is secured by deposits (which they may be planning on taking?), but he repeatedly says the loan product is an 'unsecured loan'.  It literally sounded too good to be true and probably wasn't real.

Good work on doing your research.  Time well spent...

 Hi Brent!

Welcome!  I agree with Ben.  Going to meetups and the like to get started is the best way to get in the door and inside some of the investor circles in your area.  My contribution here would be that if you can qualify for conforming/ conventional loans to reach your goals, then use those first.  Don't stray off into the hard money realm until you need to (because of project volume/ # of projects or time constraints).

Good luck!

25% down is required per conforming guidelines for 1-4 unit properties.  Does CashCall's "stated" claim to allow less down-payment for 4-unit purchases?  Or are you just curious about their stated program in general?

I'm not familiar with them either.  What are the specs of your deal?  It couldn't hurt to shop it around to verify the terms you are getting are competitive.  There is a lot of competition in the private lending space in LA/ SoCal.  This should benefit you.

Be careful with your presentation of this idea to potential conventional lenders when closing your deal.  Borrowed funds are not allowed to be used to close conforming or government insured or guaranteed mortgages.  The down payment funds must be owned funds.  You will need to source the funds if you close within 60 days of your receipt of these funds.  If the funds you receive are not a gift, you will have a violation of most lenders' guidelines on conforming or government mortgage products.

Hi Brian!

Congrats on your engagement, your new venture, and on joining BP!  

 The poster, who is new to investing, mentioned the use of tax assessment as their gauge of value. This is exactly the reason I posted about tax assessments.  I am literally telling the new investor not to pay attention to tax assessments.  Your post could be construed as if assessments are a good gauge of value in some locales, which it is not.  Whether the assessment is within 20% of the value or not, it is not a good gauge of market value.  An investor needs to run their own analysis. That said, the point is not to use tax assessments in the market valuation conversation and nothing else.  The conversation wasn't about the actual variance between market value and tax assessed value, it was to ensure tax assessed value is not used in analyzing the market value of real property and that it doesn't become a bad habit for a new investor.

 Further, the large discrepancy causing some homeowners' tax assessments to date back to 30 years ago is because of Prop 13 that protects older, long-time homeowners from higher tax assessments/ tax payments in CA (it limits the increase on tax assessments to a certain percentage of the previous year unless the property changes ownership, at which point the tax assessed value is updated within 12 mos of the close usually).  When you buy a house in California, the property is reassessed.  Thus, if you have a homeowner in CA who has owned their property for many years, they're assessed value can be WAY lower than that of their new neighbor who is a new homeowner.