All Forum Posts by: Jonathan Pflueger

@Jameson Gowin

This is a common strategy - an even more common strategy is getting a HELOC on a primary home. If the numbers on the LOC make sense for your criteria it is a great option to free up cash without giving up your investment. A cash out refinance may also be a good option with the low rates right now, you may even be able to drop your rate low enough as to offset the additional debt.

Bottom line, the more funds you have available the more options you will have. 

@Sawyer Smith

During a renovation on a multi-family we have in the San Lorenzo Valley, Boulder creek we found a huge pornography collection in the attic. I'm talking magazines on top of magazines from all genres dating back to the 60's. Later on we found out that the attic was only part of the collection, when the owner had passed the seller had cleared out a full garage and two other units full of it - guess they missed the attic. Some people said the collection could be worth some money and we should try and sell it, we opted to dispose of it at the dump in black trash bags. One of those "if the walls could talk" situations and I wanted nothing to do with it. 

@Mario Garcia

Anyone have any experience using InvestorFuse 3 (IF3), the one that is not linked to Podio? I have been doing a lot of research on CRM's and the one that appears to fit my needs best is IF3. IF3 is the most expensive of all the CRM's I have looked at, and I have looked at a lot of them, coming in a $250.00 a month - that's a large price tag.

@Robert Hall

Lots of good advice from @Will Fraser, can't go wrong with what he gave you. Some of the things you are talking about refer to something called the Internal Rate of Return (IIR). This is specifically true when you start thinking about buying properties that are cash flow negative. IRR is a tool sophisticated investors use to measure the rate at which a real estate investment grows (or, heaven forbid, shrinks). It takes into account depreciation/appreciation, write-offs, rent increases, and various other factors. The easiest way to understand it is this: most investors evaluate a deal from year one numbers, IRR evaluates a deal over a period of ten years.

Stick with an FHA loan and get a CPA to answer all your entity and tax related questions - a good property manager might also be a good idea depending on how hands on or off you want to be. Read up on IRR and be familiar with it - it will give you insights into other factors that can, depending on your criteria and circumstances, drastically alter how you underwrite and approach real estate deals.

My family and I are looking to buy a vacation home in Washington State or Oregon. We would like to use it as a short-term rental while we are not using it. The home needs to be on a river or lake and within 2 hours of an airport. 

We are looking in the $300 - 500k range. 

I am buying value add single and multiple-family units in San Lorenzo Valley (Mt. Hermon, Felton, Ben Lomond, Brookdale, and Boulder Creek), Scotts Valley, and Santa Cruz areas of California. We use conventional, hard money, private money, and very creative financing options to get deals closed and renovated quick.

We love unique properties with lots of issues and/or problems. Wholesalers welcome.

@Jody Sperling

I agree with @Cody Neumann, all of those hard pulls can cause a large drop in your score. Luckily, if you leave your credit alone for a few months it should start to improve. 

Sounds like you are applying for multiple credit cards? If you have the option try, apply for a HELOC instead. You may get a much larger credit line and only result in a single pull.

@Adrian Balderas

Since it is on your primary residence and assuming you have the DTI to cover it I cannot see any reason you will not be able to get one. Money is cheap right now, go out and get it!

Remember, bankers are people too and a lot of times they bring personal baggage to the business side, I have see this more in local banks and less in mainstream banks that tend to have rigid systems in place for handling loans that take the human side out of the equation. Obviously, one of the downsides to mainstream banks is the rigid systems they have in place. It's a tradeoff either way, but do not write them off - a good rate and terms are a good rate and terms no matter where you get them. 

@Adrian Balderas

Try another bank bank? Relationships with local banks are important, but simply shop around more if hey are not giving you what you need. Maybe try a broker or a larger more main stream bank. 

What property are you trying to get a HELOC on? If it is not a primary residence it is considerably harder but not impossible.

@Jameson Collins

Working with the lawyer is a good idea, he/she will hopefully have lots of experience with theses sorts of things and be able to guide you along the way. 

Point #2 concerns me a bit. What happens if over the next couple of years the property cash flows nicely but fails to appreciate or even dips a little? In point #3 you mention contingency plans for something like this or at least you allude to it - I would make sure you clearly spell this out especially because it sounds like your parents are expecting some sort of gain at the end of all this. 

"Keep it simple stupid" is one of my favorite sayings. I say this to myself all the time and it has saved me grief time and time again. In contracts the simplest ones are generally the best. And as an aside to that, the best contracts all end with both sides feeling like they won (this is even more important when family is in involved).