All Forum Posts by: Nathan Emmert

Have you spoken to portfolio lenders who may have different rules?

Hmmm, that's $500 a year in just mortgage payments for me at the moment... not gonna make me rich, but still a couple extra % points in your pocket if it works.

 You can't call a banker until you understand what area of investing you'll be partaking in.  Are you looking for a portfolio lender or conventional... are you looking for residential financing or commercial... are you looking for short term funding for a flip, mid-term funding, or long term buy and hold...

Step 1 is making a business plan to understand WHAT you're asking the bank for.

But yes, calling a bank should be done early to understand exactly what options you have when evaluating a deal.

My personal feeling is the harder you make your first deal, the less likely you are ever to do A first deal.

I think a lot of people would be best off just trying to hit a single and get their feet wet.  They can look to continually improve their position and buying from there.

Ignore no money down... 30% CoC returns, $100/door, 2% rule... blah blah blah... buy a flip that makes a profit... buy a rental that cash flows after 50% expenses... then develop more advanced strategies to improve in the future.

Step 1 in real estate investing is to ACTUALLY invest in real estate... Step 2 is to NOT screw up so badly you can no longer invest in real estate!

Easy answer is you can avoid law suits... lawyers don't sue people they don't believe they can collect against... getting a billion dollar settlement against someone with $10,000 in assets is worthless.

A simple search can reveal your assets... if 1 LLC comes back owning 3,000 properties, there's money there. But if it comes back for just that 1 property... meh, not worth it.

Sometimes the best defense is simply avoiding being a target for lawsuits.

Hmmm.... bought a HUD home for $72,000 that rents for $1,350 a month... but a 4plex off Craig List for $120k that rents for $2,100 a month... another Duplex for $52k that rents for $1,200 a month and a triplex for $100k that rents for $1,300 a month.

Deals are pretty easy to find in Ogden which is an hour from SLC.

Seriously though... thread after thread of "I can't find the deals... on the MLS... in my backyard...". Guys, come on... you're smarter than that. This isn't supposed to be easy.

Expand your range... use more tools than the MLS.

I bought 8 properties in Ogden with $25,000 cash... all of them rented for at least 1.5% of purchase price and the last 7 were 100% financed.  This was done through lots of research and phone calls.  I'm no Guru, I'm not special, just someone willing to put in some time and effort.

Make 1 mistake with those cards and your veil is pierced tying the finances of multiple properties together.  Are you personally guaranteeing those cards?  Wonder if that links them as well?

Bill has made the point many times and I'm in violent agreement with him, get an umbrella liability policy as it is far cheaper and much better coverage.

Sounds like you should be moving a wall a few inches.

In Utah, I believe standard occupancy is 2 * # of rooms + 1... so we can have 3 in a 1 bedroom house, guess they sleep on the couch.

Really need commas, you seem to be missing a lot of digits.

What's the property insurance?  Are you paying lease fees or just a straight 8%?

With 15% of your rent going to paying utilities you're going to be well over the 50% rule... I believe even large apartment complexes that account for utilities in the rent run closer to 55% expenses.

At $15,000 monthly rent, you'd be looking at a $750k offer for the 2% rule... most people look for 2% without having to pay utilities so they would likely discount that $750k some to account for that as it impacts the NOI.

You don't pay property taxes?  What about property insurance?  What happens when the dishwasher breaks?  The fridge?  The HVAC?  The hot water heater?  The roof springs a leak?  What happens when your tenant moves out and you have a vacancy for a month... or two... or three... what happens if the prior tenant trashes the place and you have to spend a few thousand getting it rent ready?  What if they stop paying and you have to pay for an eviction, that's about $800 here?  Who is paying for water/sewer/trash?

Do yourself a favor and do some more research.  Look up the 50% rule for expenses.