All Forum Posts by: Brian Adams

@Peak Deshawne in order to take over the mortgage, Yes the bank/lender will need to approve you. 

In order for you to assume the loan, most lenders require that the loan sponsor have a net worth equal to or greater than the loan balance and liquid cash post-close equal to around 10% of the loan balance.

I would ask the seller to stay in the deal as the loan sponsor and help you finance the transaction so you have funds for capex. 

In exchange, the investor will want some type of compensation such as a higher interest rate, a chunk of equity upside when the asset is sold, etc.

Good luck!!

@Steve Chan I agree 100% with your points.

As a sponsor when I have had to defer cash flow payments, I clearly communicated with my investors the "plan". Why a deferral was necessary, the steps to accomplish the plan and ultimately paying the investors their deferred cash flow payments.

My situation was to redirect investor cash flow payments back into a value-add property so we could upgrade and turn vacant units quickly. It resulted in additional value of about $3.5 million so the investors were thrilled with the end result.

Were all investors thrilled in the beginning with zero cash flow for a couple of quarters...no.

The best sponsors in my opinion are those that are in regular communication with their investors to keep them updated. Even when the update is not good news.

@Steve Chan has your confidence in the sponsor changed?

A good operator should be communicating regularly with the investors and sharing the good, bad, and most importantly the ugly.

@Account Closed that is very valuable information.

I just wanted to add, in order for a DM piece to perform, your marketing message (copy) must match the questions going on in your target's mind and address their concerns, challenges, and problems.

You could have the best copy, but if the letter or postcard is being sent to a target list where things aren't congruent (a match around solving their problem), what ends up happening is a deep frustration around DM.

DM can be expensive to do on a regular basis. If you aren't getting calls, an overwhelming feeling that you are wasting money settles in. What will come next is throwing your hands up and telling everyone that will listen that DM doesn't work.

DM is a long game strategy.

What has also worked for me is you need a strong headline, an attention grabber.

Finally, and most important, is you need a CTA (Call to Action). Your prospect has your letter in their hand, be very clear in your CTA on what you want the target to do next. 

Should they call, text, or email you. Go to a landing page to receive a free report on something.

Make it extremely easy for the prospect to take the next step.

@Karthik Ramachandran if you are the sponsor of a syndication and depending on how you setup your operating documents, you call the shots on the game plan and splits.

My guess is you meant to say the majority of the cash flow instead of the "majority of NOI".

If you are putting a deal together with investors, it only makes sense that your investors will also want a piece of the cash flow.

If you are just getting started trying to take down larger deals, be prepared to give more of your deal away. I know this was my case when I started and my guess is it happens to first-time syndicators.

@Rich Weese sorry to hear about your deal.

I haven't heard much lately about a seller carry. If the buyer's lender is going to allow, could be a creative way to get your deal done.

Good Luck!!

@Bailey Kramer using direct mail to buy apartment deals does work.

Check out this link Bought 200+ Unit Apartment Complex, Increased Value Over $4 Mill

If you are looking to locate deals though, direct mail is a long game strategy. Meaning, that most likely an owner will not call you on your first, second, or even third letter. 

Follow-up, Follow-up, Follow-up

Most people who use DM as a strategy give up after the first mailing if no one calls.

As you map out your strategy, make sure you budget out how many mailings you can afford and select a list that clearly targets your audience.

Not all lists are equal, I pull my list from Yardi Matrix.

@Christopher Smith you got some good nuggets of information.

Now define, what does the pinnacle of success mean to you? 

Put the hard work in to create what you want.

Go get it!!

@Jason Malabute yes most definitely on IRR and not sure what sources you are referring too.

@Evan Dyer add Dave Lindahl's Emerging Markets book to your library. I have bought and sold 4,000 units using some of Dave's emerging market strategies.

I think the most important next step is to focus on your "WHY". 

Why is real estate your next move? 

Get really clear on your goals and on what you want real estate investing to do for you. Wrap tons of emotion around your WHY. This strategy has helped me and hopefully you get a nugget of info at this link I quit my CPA Job to buy Large Apartment Buildings