All Forum Posts by: Patrick S.

Anyone have experience subdividing a lot into 2+ smaller lots? Currently looking at exit strategy options for a potential deal. There are multiple homes built on one lot. Each has individual water meters, but they share the same sewer line. Looking to hear your stories, steps, timeline, cost, etc on what it took to get your lot divided. Thanks

@Michael Le Thanks for walking me through that. It makes sense that the bank would be interested in loaning you money to improve the property and generate a higher NOI, thereby helping you meet your obligations to pay and improving the value of the property that they effectively own. I'm more familiar with conventional residential loans, which will not provide money for rehab unless you're getting an FHA 203k loan.

@Michael Le How do you get a bank to roll the rehab into the commercial loan? Simply add it as a line item into your loan request document as such? Or would you roll it into what the seller owes you, similar to how you'd get the seller to pay closing costs on a conventional loan? I assumed that getting a commercial loan would be tough enough without adding rehab costs. Then again, if you can argue and prove why it'll be more beneficial to NOI and DSCR, I'm sure they'd be more than happy to earn more via down payment and interest.

Hey Chris! That's quite the life story. Congrats on the ones that did go well and kudos for having the guts to tackle a 171 year old house. Plenty of us on here from Indy. Welcome to BP!

@Natalie Kolodij Will most lenders even give him a loan at only 3.5% down for multiple units? In my experience, many lenders want at least 20% down for a duplex. Now, that's just my personal experience. Would love to hear that other people have been successful with duplex purchases for 3.5-5% down. I'd also be surprised to see him get a mortgage at 4% with that high of an LTV.

@Anthony Hill  Those seller-financed terms don't look terrible, but as other have mentioned, keep shopping around. Run the amortization charts. 1-2% over the life of a loan makes a big dang difference. Seller's asking you for about 5% down, which isn't far off what you're going to pay for 3.5% down plus closing costs on a traditional loan.

Check out your local credit unions and if they don't offer a low enough rate, check out an online credit union called DCU (dcu.org). They're offering rates as low as 1.99%. When I got a loan from them about a year ago, that rate was 1.74%. The kicker to get that rate is that you must direct deposit $1k or $2k into your savings account with their bank. If you don't do that, it adds 0.25% to your ARV. The biggest perk to this place? They offer a 125% LTV loan on the vehicle. I happily took that extra 25% at only 1.74% interest and used it towards the title and registration. You can pay cash or you can finance at a rate that's below inflation and use that cash towards a new property that'll easily cover the loan payments.

Hey @Brandon Turner, thanks for letting us all know! Is he deciding between Bloomington and Indy or is he definitely moving to Bloomington and Indy's just the closest large city to name? You know, kinda like when people are from anywhere in Illinois and they just tell out-of-towners that they're "from Chicago." Regardless, we'd be interested in his contact info! Thanks again for the heads up.

Hey Mark, welcome to the party. Always good to have more Indy folks on BP!

Congrats guys! That's a big win. Looking forward to seeing your results with this one as well as your future deals. If you guys are ever down in Indy, give me a shout.

I'll agree with what a lot of others have said. Around 38th St, you'll run into quite a few issues. North of there on Meridian, there are million dollar homes. South of there a few miles (16th St and south) plus a few blocks east, there are more million dollar homes. The area all around Chatham Arch and Mass Ave is getting restored as well as down in Fountain Square. The good to moderate deals are getting picked clean and the homes that are there are appreciating.

There are a few areas north of 16th St such as along Delaware, Alabama, etc that have really been cleaned up. Once you get north to Fall Creek though, all bets are off. East a few blocks on College and Central, you can see many new SFH & MFH going up and many restorations happening. I wouldn't be surprised if they have their issues with theft and crime though, at least for a few more years. Pretty blighted area that's a hotspot for investors willing to take a gamble. Easily Class C and only a few blocks away from Class D. This article's a bit dated but still applies pretty well. http://www.indystar.com/story/news/crime/2014/10/09/mayor-ballard-and-impd-to-focus-on-crime-prevention-in-six-indianapolis-area-neighborhoods/16979317/

Feel free to PM me if you have a specific home/cross street/area you're looking into. I'm more than familiar with this area now and happy to help. I'd be happy to Facetime and let you see for yourself.