All Forum Posts by: Raj Mulchandani

If you buy and repair it is assumed you will be building value into the property (usually 10-15% at least) or why not just by the property repaired.  

Assuming this is true once you are finished with the repairs, you should be able to find a loan at 70% which should be 80-90% LTC(loan-to-costs). This way you can take most of your money into the property and move on to the BRRR.

Welcome Hercules.  Being a private lender I do come across some in the Southern California area from time to time.  Feel free to message me with where you are mainly looking for deals dollar size and if anything comes up I'm glad to send it you way.

Thanks,

Raj Mulchandani

Congrats! I am currently financing a flipper who has already completed 5 ca/nv homes at the age of 20.  The deal I am financing him on next is over a 3 million dollar purchase with a significant rehab budget.   I am pretty certain I will be working for one of you guys someday :)

I think it is great to start young as like any other investment it is a patient mans game and the earlier you get started the better off you are.  I unfortunately waited till 29 to buy my first place and then second place at 31.  A big reason was due to me always having some excuse the market is too high I'd rather not put that much down I'm too busy working etc.  

After doing over 250 million in financing transactions the last three years, one thing I have come to realize is there is always opportunity.  It sometimes does require thinking outside the box like going to a different geography or could be the financing options are what makes the deal.

One thing I will caution you with using high leverage, is make sure you are cash flowing at atleast a 1.25x debt cover and use a 45-50% expense factor.  This should allow you to whether the unexpected vacancies and deferred maintenance plus ensure you wil qualify for a refinance if need be. 

Best of luck on getting to 150!

Hi Bill thanks for the advice bc the rules are fairly confusing.  Question - if I pay for the pro does that allow me to have my email and number in my sig block and also can I pay for ads on the site.?

also never been to Saint Louis so must be a different raj :)

I would just check with your local banks on what heloc products they offer.   The best I found on a second was up to 75-80% ltv around a mid 5 rate floating.  If you are using credit cards this should save you money.  if you have experience rehabbing or have any rental properties I can definitely help you with the private loans as we offer some of the most competitive rates in the nation.  

Thanks,

Raj Mulchandani CPA

coming from a lender who has both flip and rental products if you can get 175 sell it.  As for the taxes you can always do a 1031 exchange into a similar property and defer the taxes.   

By selling you should be able to buy atleast 3-4 more properties BRRR all of them and have some serious cash flow :)

Hi Dirk,

I do a lot of private money rehab deals in San Diego. Also if you are looking for perm financing I spent 5 years working at BOFI which is headquartered in la Jolla so can probably introduce you to some of the better reps there as well.  Feel free to message me if you would like more info.

Thanks,

Raj

Hi Steve,

you can check out are products at 5archgroup.com but to answer your question we currently lend in ca, fl, az, tx, nv, wa, or, ga, and il.  We should be moving into a few other states in the coming months.  

Feel free to pm me if you are looking for a lender in a state I am not in.  I worked at a bank that provided credit facilities private lenders across the U.S. prior to joining 5Arch (who was also a client of mine) so can usually point you in the right direction if it is not in one of our states.

Thanks,

Raj 

I personally would start with the loan.  If your deal is presented correctly, you should be able to mitigate the limited experience.  

For example, our guidelines require at least 1 deal in the last 12 months. However if the person had good credit, decent income, and found a good deal along with putting an additional 5-10% down that now sounds like a deal that warrants an exception.  Another mitigant could be that you have hired a general contract with experience and have a full budget ready to present along with as is and as repaired comps based on your plan.

If none of this work you could try and joint venture with another rehabber and leverage off of his experience the first deal or two while you are building your track record.  This may also be a good learning experience and give you another set of eyes looking at each deal with you.  

I hope this helps.  Feel free to pm me if you have any other questions about qualifying for a rehab loan.

Thanks,

Raj Mulchandani CPA

Thanks Nick.  I assure you it is not as interesting as the investor side but an essential part of getting a real estate deal done.  I also have worked in both traditional bank financing and private financing so will probably do a blog on the pros and cons of each. 

Also, feel free to message me as well if you have anything in specific you want a lenders take on.

Thanks and talk soon.

Raj