All Forum Posts by: Randy Rodenhouse

The BRRR strategy is not a match for the current market. I would not focus there. You need to find houses you can buy with owner financing or subject to and then sell with owner financing. To buy a house now and financing with expensive money, then rehab the house with more expensive money, then rent the property and be able to cash flow will be hard even if you are going to refinance since the refi rate will be around 7.5-8%. Now in some areas of the US this will work but for most areas it will not.

No.  Not sure what that broker meant since getting a loan is essentially cash at close.  

These are the steps you want to follow.

1. Create an LLC.
2.  Find a property to put under contract.
3.  Deed the property into your trust where your LLC is the beneficiary.  The LLC is not the trustee. You have to find a trustee that you trust and it is usually a person but could be an another entity.    

Typically, I put each property in a separate trust, but will use the same LLC for three or four properties depending on the amount of equity. 

Now the property is owned by the trust and the LLC is grantor and beneficiary. You don't have to create a separate trust to hold all the LLCs. There are holding entity structures, but I think that's overkill unless you have at least 20 properties.

Try to collect biweekly or even weekly payments since splitting it up many times does not seem as challenging for the tenant and they pay you before they spend their money on stuff they may not really need.

Insurance is a constant problem and you have to be continually looking for new insurers.  In the early 2000s Allstate dropped all our policies in South Carolina and I had to find new ones. I never had one claim and they still dropped on my policies.  Recently, I canceled all my Statefarm policies because they never responded to request for updates and continuously said no to any claims.  As far as I know, there’s not a single source for finding out about different companies, you have to just continuously do your own research. 

The term blanket mortgage refers to a single mortgage that covers two or more pieces of real estate. The real estate is held together as collateral on the mortgage, but the individual pieces of the real estate may be sold without retiring the entire mortgage.

Blanket mortgages make it easier to get financing for multiple properties rather than having to take out numerous mortgages.

Portfolio loan is one that is kept by the bank who originated it and does not sell the loan to Fannie Mae or Freddie Mac or securitize into mortgage back securities.  The lender keeps the loan on their own books and they don’t need to sell the loan to get the money back to re-capitalize. Most banks must sell most loans to the secondary market to be able to rinse and repeat the process of continuous lending. 

There are a couple of requirements. One is that it must be max of 4 units. Second, you must live in one unit for a year. Third, you must qualify for the loan with proper DTI as so on. This is unlike a CRE loan were they look at the property income and not your income.

A free and easy way to get comps is by finding a friendly realtor that will allow you access to the MLS and you can research it yourself. Or you simply ask the agent for comps based on a particular property. Most of the data services are based on public records and/or MLS data.

My only input is to expect interest rates to be higher for longer much longer than you expect. Even if the Feds  cut in the feds funds rate (which I don't expect in the next 6 months) it will not necessarily translate into a lower long-term 30 year rates.