All Forum Posts by: John Woodrich

@Dustin Ruff I have seen electric run through a chimney but would be surprised if it was OK.  

You mentioned you owner occupy, if you are your "electrician" talk to the electrical inspector and see if he is fine with it.  Otherwise leave this decision up to your hired electrician as he will have to pass the permit.

1 - You would offer a new lease to the tenant.  I am not sure of the due-diligence you have done on rent prices for warehouse space but I would look this over before booting your tenants.  You will also want to consider their options such as leaving and the cost of vacancy.  If this is a short-term deal I would probably leave it or only move the needle slightly if needed.

2 - Nothing specific that I am aware of for commercial properties and MN doesn't have rent control.

@Blake Wash it sounds like you have a lot of work to do.  Maybe a good plan would be to hire a PM to get things stabilized and then self-manage to help make your numbers work?  

@Ali K. I haven't heard of a CU that doesn't finance investment properties...  I have a few investment property loans a a CU, send me an email and I can share who I use.

@Nathan Shankles most all personal loans have the due on sale/transfer clause.  Some people void them anyhow.  I personally don't but many of my clients chose to do so but it is a business decision for them.

@Nathan Shankles you wont get a 30 year fixed conventional loan but SOME banks offer 30 year AM loans for commercial properties.  Downside is typically 5-10 year balloon/refi, non-fixed interest.

@Gordon Olson your budget is a concern but you could make that work in certain locations. It will always be easier to cash flow a MF than a SF unless you but at a great price.  

You mentioned that you don't want roommates but "not everyone can afford a Cadillac" if you know what I mean.  Sometimes you have to do what makes the most financial sense for you even if it means sacrifice.  RE is a marathon, not a sprint!

@Gordon Olson reach out to @Tim Swierczek, if there is a way he will know how.

Many new investors start by owner-occupying a duplex as it solves their need for housing and getting in on the cheaper end.  If you don't have money for a 3.5% down payment you may find it near impossible to get into rehabbing properties.  Only option may be to partner with someone who has the cash who would like to utilize your low-down payment loan.  Now it may seem like a good idea but that may not be the case in a few years if you hold it.

Not enough information for anyone to decide if this is a good deal and can't calculate CAP rate with the information given. It sounds like this is a small building with a parking lot. If it is a flat roof needing repair or if the parking lot needs to be repaired those are very large expenses..... The parking lot and the roof could cost more than $50k to replace.

Commercial properties are valued based on CAP rate. If you figure out the NOI then you will have to find the CAP rate for the area for a similar style property.

Somewhat sounds like you are interested in this to get your dealer license.  Figure out what all your expenses are, figure out what your repairs costs are, deferred maintenance, etc and you can calculate the property value (via cap rate).  

@Ali K. Sure payments on a LOC can be higher but it typically doesn't cost anything to setup a LOC and you can always refinance on the back end. This would be a good way to get your down payment funds for purchasing an investment property. The LOC will give you cash to spend, it costs nothing if you don't borrow against it.

The odds of finding a deal, starting the refi process to get cash, then purchasing a property are near impossible. There are plenty of people with money waiting for something to happen, if you want to purchase something in this market you have to act fast. A LOC could be a nice advantage for you.