All Forum Posts by: Rodney Kuhl

@Josh C. How do I go about doing it? If my lender told me they will only lend to individuals, won't it cause issues with them if I switch the title to an LLC? Also, what is the quit claim deed process and how do I go about that?

The INREIA meetup was last Tuesday. It goes every 2nd Tuesday of the month (same day as CIREIA).

I invest in Indianapolis, and I am closing on 2 more rentals in the next couple of weeks. I have been working with a great lender and I have been able to lock in low 30-year rates, which is definitely a great thing as I see rates climbing over the next few years. However, they only lend to individuals, so the loans are in my personal name. If I wanted to switch the title over to my LLC to provide more protection to myself, what effect would this have on the loan? I'm guessing the lender could act upon the due on sale clause, so is there a way to avoid that risk?

@Jon Holdman Thanks for clarifying that! That's what I've come to learn. Frustrating that buying a property as a good deal (meaning, below market value) can actually hurt when it comes to valuation down the road.

I understand that this appraisal wouldn't come into play were I to re-fi down the road, but it would have provided some security to me that I'd be able to get the value I'm looking for in an appraisal in the future.

@Sam Shah Welcome to BP, Sam! I have communicated on BP with someone from 52 Properties, but I don't know much about the details of their properties. I'd be glad to help if I can. If you want to PM more details and the address of a property of theirs you are looking for I'd be glad to take a look into it.

@Guy Raveh After discussing with a mentor who spoke with a few other realtors and another appraiser, we were told that on purchases, appraisers know the purchase price and will come back with an appraised value just to cover the purchase price. During a re-fi, however, an appraiser doesn't have a value in his head and will have to go about properly evaluating and analyzing the value of the property. All of those realtors agreed that the market value is higher than what the appraisal says, so that's encouraging.

@Evan Manship Yeah, basically I think he saw the purchase price and just figured out a way to cover that.

Am I allowed to talk directly to the appraiser by Dodd Frank rules?

@Evan Manship @Mike D'Arrigo @Guy Raveh Thanks for the input all of you! What's weird is that a couple of the properties on the appraisal actually sold this summer for over $80k but he has them listed at prices they sold for cash at under $40k (obviously hurting the value). He also used active listings, including one that is a short sale. From my understanding, they have to be sold comps, so that doesn't seem right either.

I get appraisers not wanting to go to high as that can raise red flags so they want to cover themselves, but they should still fairly value the property.

@Matthew Schroeder Thanks! Sent you an email with the appraisal.

I purchased a property in Indianapolis at a good price ($39k), well below what the comps show for the area ($50-60k for rental grade, $80-100k for retail). However, because the appraiser knew what the purchase price was, his appraisal came in just above that value so that it was just enough to cover the loan.

My strategy when buying the property was to buy it at this low price so that I would have a good amount of equity when purchasing it, so that in the next year I could re-finance the property, pull the equity out, and use that equity to purchase another property. However, now that the appraisal came in low, there isn't enough equity to do a cash out re-fi. If I were to re-finance I would obviously have to get a new appraisal and this one wouldn't make a difference, but had this one appraised for the value of the comps I would feel more comfortable with the strategy in a year. But with that appraised value, now if I were to look to re-fi, I'd essentially be forking over $400 and crossing my fingers that the appraisal comes in where I would expect it to based off the comps, but if it doesn't I'd just be out $400.

Is there any way to get an appraiser to re-evaluate? If not, when looking to re-fi, is there a way to get the appraiser to forget about the purchase price and value it properly based on the comps?

@Rob Gribben Curious to know where you got the info from saying that area would rent for $950/mo. That seems very high to me, and I'd be happy to take a further look if you'd like. Feel free to reach out to me with any questions about addresses/areas of Indy as you are looking. Good luck!