All Forum Posts by: Louis Mannikko

Hey all, I am trying to figure out a way to fund my primary home construction. I currently own my own home, and our debt to income ratio is about 41%. I am trying to have my house built while still living in my current home, however, when we add in the mortgage of the new home, it increases my D/I ratio to about 59% and the bank I was working with said I would not qualify. I have a large amount of equity in my home, value needs to be officially appraised, but I should have somewhere between 47k and 60k in equity. Plus about a 40k down payment. I am looking to build a house with a budget of ~400k. Does anyone have any ideas on how I can accomplish this? I could sell my current home first, however, that is not ideal. Would a hard money lender be an option? That's obviously the most expensive route. Current idea right now is to sell our current home and rent a house while the new home is being built. I was just hoping someone on here had some ideas that I may not have considered. Thanks in advance for your time.

There are companies out there the specialize in brewery financing.  You could probably just google them.  Find one of those, as they will be better equipped to understand the issues around brewery financing.

There is also an excellent class in craft Beer & Brewing Magazine that will give you some helpful ideas:

https://learn.beerandbrewing.com/courses/building-...

If the brewery is killing it however, I am sure you could take their balance sheet to any bank and show the revenue streams and they will loan you the money.  Most challenges with breweries are around start up, as its VERY costly to acquire the capital needed to open the doors, and most banks don't like the idea of shelling out that capital without proof of revenue.

Good luck!  let me know how it goes.

Thank you both for your replies.

Good morning everyone!  Hope you all are having (or will be having) a wonderful day.

I am admittedly a newbie at the real estate game. So I am hoping some of you seasoned pros can help me move in the right direction.  Here is the scenario..

We would like to sell our home in Pompano Beach, FL and buy a distressed home that we could "fix up" to our liking.  We have had a few realtors come by and suggest that our home could sell anywhere from $280k (as is) to $320k (new kitchen and baths(2)).  The home has a new roof (more on this in a minute), new floors and a new A/C (I'm in Florida, so this is like gold).

The roof was financed through a PACE program.  For those who don't know what that is, its basically a private loan, subsidized by the local government and paid back in the form of a tax lien on your non ad valorem taxes.  So the loan is not against the individual (me), its against the property, and stays with the property until it is paid off ( so a new owner would need to take that on, but they also get the new roof).  I know this wasn't ideal, but it was the only way I could pay for a fairly expensive project, that HAD to get done (old roof was 50 years old).   based on the equity I have in my home, I could pay that off if it was a) necessary and b) required by the buyers to make the sale.

In any event, based on the numbers I have about 220k on my mortgage, so I am sitting at a fairly strong position equity wise. Problem is, realtors commissions will eat up 6% ($17k) of that if I have a buying and selling agent. Plus closing costs of around $5K-$8K (think this is close?)  And If I have to pay off the PACE loan, thats about $20k.  So you can see the equity is getting chipped away here at an alarming rate.

On top of that, we are trying to find a steal for another property.  Were looking for a 3+/2+ home in Jupiter, FL that is somewhere around the $200 - $250k range that we could put $100k into and make our "forever home".  Which is proving very difficult as well.

My questions to the forum:

1) Is it worth it to have both a buying and selling agent?

2) Should I pay off the PACE loan, or transfer that cost to the new owner? Do i have to disclose it? or is it something the title agency should bring up?

3) Should I sink some more money into the property and update the kitchen and bath to try to get to the $320 value?  ( I think I could do this for about $10k-$12k)

4) Does anyone have any good websites for foreclosed homes, auction homes?

5) Does anyone know a good Realtor in Jupiter, FL that sepcializes in Foreclosed, REO or auction homes?

Thanks.  Please let me know if you have any more questions.  I'll be happy to share more specifics on here or in a private message.

Do your due diligence here, ScrubJay protection is a huge concern in these areas.

Please send me more information on this property as well.  thanks. 

I'm curious. Can I get more details?

Hey All,

I am dead set on making real estate investing my future.  My goal is to have my first property within 90 days.    However, I am really having trouble understanding the acquisition and complexities around financing my project(s).

Is it as hard as I am making it out to be in my head?  I have heard there are 1000 ways to go about this, but I am inexperienced and don't really know where to begin on looking for funding.  I have access to a rather large sum of money in my 401(k), I have a conventional mortgage available to me up to $150k (at least that is what my broker told me on a 5 minute phone call), and I have contacted a hard money lender for more info (still waiting to hear back).  Not sure how to even go about finding a private lender

Just hoping someone can help me set off in the right direction. Books, Articles, companies, a cold beer to relax...  Maybe someone has had this same concern/issue when they were starting out and can offer some advice?  

My plan is to flip houses and buy and hold rental property.  I'm ok doing both.

Thanks in advance for your time.

Louis Mannikko

Hey Everyone, 

Talked to my mortgage broker today to see what kind of property i would qualify for with a conventional mortgage, and she said something that I wanted to verify with everyone.

A couple of properties I am looking at are Condos, and they have an association fee associated with them.

My broker pretty much cut me off and said, any unit that is part of a "Condo Association" will not qualify for a convention mortgage on an investment property. If its a HOA, thats fine, but its all in the wording of the association, if it says Condo Association, its a no go, if it says Home owners Association, its perfectly fine.

Just curios, has anyone else heard of this?  Any more information as to why that is the case?  She said it had something to do with rights of ownership that the banks didn't like.

Thanks in advance for your time!!

Hello,

Just curious what you all thought about the idea of using a loan from your 401(k) to finance the purchase and rehab of a 1st property.

My plan would be to use 40-50k to purchase a small rental apartment, fix it up, and then refinance the property to pay back the 401(k) loan.

Any downsides to this?  Thanks.