All Forum Posts by: Paul Jurczyk

Thanks everyone for the responses. Much appreciated!

So it would seem that the general consensus is that 5%+ is pretty normal for a commercial loan at this point in time.

I went with a commercial loan for the reasons mentioned above @Justin Sullivan. I wasn't able to qualify for a residential loan, but going commercial worked. The problem is that my interest rate is very high (above 7%). So I definitely want to refinance to a lower rate.

I did speak to one lender that said he worked with several individuals over the years that moved from LLC to private and then back to LLC after refi - so it would seem that it's doable, at least in some cases. I'll be sure to update this post with whatever solution I arrive at.

Thanks again everyone!

Hello 👋

I bought a 2 family house in Harrison NJ last year and am looking to refinance. Ideally, I would like to do a cash-out refinance. The property is owned by an LLC of which I am the sole proprietor.

I reached out to a couple lenders and they're quoting me between 5% and 6% for a 30 year, which feels a bit high to me - but at the same time, I hear that may be pretty standard for commercial loans?

So I'm wondering if there may be some strategies I should consider? For example, I was thinking if it would maybe be possible to refinance the property under me directly in order to get a lower rate, and then transfer the property back under the LLC asap, keeping the same rate?

From my understanding, some lenders will call the mortgage at the point of transfer, while others will let you transfer without calling the mortgage - so in theory, I would just need to find the right lender? Has anyone done something like this successfully? Or tried and failed? Does the fact that it's a cash out refi rather than a traditional refi make it more difficult?

I should be able to do a cash out of hopefully around $100k and am excited to purchase my next property, but I also want to make sure I'm not leaving money on the table by paying too high of an interest rate. I have a rather high interest rate right now, so if I can manage to refinance at a rate below 5%, I should be able to cash out $100k and increase cash flow on the 2 family.

Any other strategies that I should consider?

Any advice (or intros...) would be much appreciated!

Sorry, I think I may need to clarify. When I say duplex, I don't mean two separate apartments. I mean a 2-floor apartment where one of the floors is the basement.

This is already a 2 family house. One apartment is already a 3 bedroom duplex (2 floors - 2nd & 3rd floor) and the other apartment is a 2 bedroom on the ground floor. I would like to join the ground floor with the basement making it into a 2-floor apt (aka duplex).

Sorry about any confusion. I know that on BP duplex and triplex often refers to apt count. I always grew up calling a 2-floor apartment a duplex.

Hey everyone!

Was hoping to get some advice on this house I just purchased. I'm considering joining the 1st floor of the house with the basement and calling it a duplex. I know that in NJ you can't technically have a bedroom in the basement, but this would basically be an extra room that they cld use as whatever (but probably wld end up using as a bedroom). So that's legal right?

From my understanding, there is no legal issue here so far. Correct me if I'm wrong please, but I believe in NJ you can rent out the basement along with the 1st floor apartment without any issues. The issue comes when you try to make the basement a separate apartment. However, I'm also considering redoing the bathroom down there.

Currently, there is a sink and toilet in the basement, but I also want to add a shower. This I hear may be an issue... From my understanding, you can't have a shower in the basement when you sell the house. So does that mean that I also shouldn't have one in there when I'm renting it out? Can I rent it out with the shower and then maybe seal up the bathroom altogether before selling it (and then have the new owner open it back up again)? If I did that, would it be considered illegal and potentially give me issues if I ever had to evict the tenant living there?

Any info/advice/past experiences on this would be very helpful and much appreciated!

Hello,

I'm considering purchasing a triplex in NJ that has 3 month-to-month tenants. The rent is quite a bit below market and purchasing the property only makes sense if I can raise the rent.

I know NJ has some strong anti-eviction laws... even with a month-to-month lease it seems like you can't just kick someone out at the end of the month, but have to renew. Only way to kick someone out is with "just cause".

So rather than kick them out or ask them to leave, I think I can raise the rent. It would be a significant raise... probably about 30%. So i'm figuring the tenant will end up moving out anyway. From my understanding, I just need to send the tenant a 'Notice to Quit' 30 days before the next month's term starts, and then the next month the higher rent would kick in.

Does this sound correct? Is it more complicated than this? Am I misunderstanding how it works altogether? Any advice would be appreciated.

Thanks @Scott D Burrows, @Michael Ablan, @Matthew Porcaro, and @Andrew Postell!

Appreciate all the information - very helpful. And yeah, my apologies; I did leave out that I'm planning on house hacking. Figure it's a good way to learn landlording. And paired with an FHA loan, seems like a great way to get started in real estate investing.

Again, appreciate the help!

Hey everyone,

Was hoping to hear some of your experiences, advice, and lessons learned when it comes to using an FHA 203k loan to buy and rehab a rental property (2 - 4 units).

My main questions are:

- Is there a preferred way, or a preferred lender for getting the 203k Loan? Or as long as the lender offers it, should be fine?

- Is finding contractors for this kind of project easy enough? Is it worth the extra expense (I know they come at a premium for having all the right licensing, insurance, etc.)? Does the lender ever recommend a contractor or are you on your own to make sure they comply with all the rules and regulations that go along with the 203k?

- Can you refinance an FHA 203k loan? Are there any penalties? Or are you basically just stuck with it for all 30 years (or however long it's for)?

- Are there any better options than using an FHA 203k loan for a rehab project? I know you can't get a conventional loan for a rehab project, so would you need to use cash/private lending? Any other options that might make sense.

I'm looking to buy my first property, so I'm definitely a real estate investing noob. But I'm not new to business, running or managing projects. So I'm confident I'll be able to handle managing the project. Just trying to figure out what makes most sense from the loan side of things - and when it comes to a 203k loan, there's a lot of factors to consider.

Appreciate any advice or stories you can share!

Hey everyone,

I'm new here, so I apologize if this isn't where to ask this or if this isn't something that should be asked here, but I'm trying to find a deal in North Jersey for 6 - 10 units. Jersey City, Union City, Harrison, Hoboken, Weehawken, etc.

It seems like finding a good deal online is difficult. So I'm guessing there's better ways. One way I hear is to get in touch with some wholesalers. Or do most wholesalers stick with smaller properties?

Or maybe you guys could recommend a better way to find a good deal? Appreciate any help! Thanks :)