All Forum Posts by: Michael Leffelholz

@Jeremiah H. I think that if you keep searching you should be able to find a lender willing to do a HELOC on an investment property. It will likely be a smaller local bank who does portfolio loans. I found one near me and while I haven"t used them for a HELOC yet it's nice to know the option exists. Again best of luck.

Michael

@Jeremiah H. what about seeing if you can get a HELOC.? Good luck

Michael

@Dan Rivera Welcome to BP. You should double check but the FHA loan is only going to be available if you are an owner occupant in one of the units. As far as the legality of the bonus apartment I would not rely on seller to verify legality. I would have your attorney do the research and confirm. You should have a Certificate of Occupancy that seller provides that states that the unit is "legal" Also if it's a legal three family it would need to be registered with the State and there should be a valid green card. Best of luck.

Michael 

@bob 

@Bob NugentWelcome to BP. It's  a great community with many experienced investors willing to share info and help.  Best of luck.

Michael

@Todd Cichosz I lend in the commercial real estate space. With regards to lending it is typically limited to a maximum of 75% LTV. If it's a commercial real estate loan that you are seeking in addition to the origination fee you will pay for the appraisal, a Phase I environmental and perhaps a property condition report. You will also be expected to pay for the cost of the bank attorney as well as yours. Don't want to dissuade you but you should know what to expect. Best of luck.

Michael

@Roy N. I also like the tenant estoppel idea. I get them when I am financing a commercial real estate transaction. Never thought of it in connection with multifamily.When my partner and I bought our first two family my attorney didn't ask for it. Now different attorney closing on three family did request it in contract. Also requested Letter of attornment from each tenant. Live and learn.

@Chris Purcell I can.t sat for certain but he may have a contract with a social service entity who pays him to use the residence as a "group home" for individuals with special needs. They have these for different situations I.e transitional housing for battered women etc. to name an example. I suppose it can be lucrative but you are reliant on the agency  who contracts with you to continue to get funding. Those leases usually have some type of appropriation clause which allows for them to cancel if funding isn.t received. Can.t say for certain that is the man.s situation but I have seen that before.

Regards,

Michael

@Lucas B. a mixed use property can be good investment Commercial tenants are not typically as management intensive as a residential tenant. A commercial lease for the ground floor tenant would typically extend for multiple years with "a high quality" tenant wanting more for less. It's not uncommon to build annual rental increases into a commercial lease. Depending on your market the tenant could also be responsible for a portion of the buildings expenses ie taxes.  Commercial space usually takes longer to rent so you should definitely weight that into your decision. Best of luck.

Michael

@Account Closed you are obviously a newbie and there's nothing you can teach this individual :)

MicGael

You dove into the deep end of the pool without knowing how to swim but some people learn that way :). Not  sure I would panic yet but like many have already said you need to do some things differently going forward.. We don't know enough to point an accusatory finger at your PM. What are the terms of your management agreement? You need to look at it and make sure that the terms are being complied with. 

Perhaps most importantly you need to take a more proactive role in your investment-it's  your  money. You should; i) Visit your properties (not just a walk around the outside): ii) Understand your property market-then look at your leases to make sure they are in line-if not question why; iii) Get a handle on your expenses as it sounds like repairs and maintenance have been an issue; iv) See if there are places where you can reduce expenses i.e can you appeal your real estate taxes? Can you get a more competitive insurance quote? v) Understand that the PM works for you and you are entitled to question things that don't make sense. Only if you are not satisfied with the answers to your questions (they don't make sense or add up) should you  make a PM change. 

Best of luck.

Michael