All Forum Posts by: Samantha Baker

1. With DSCR at 1 that would mean the rent would need to match the new mortgage payment, correct?

2. With ARV--total cost of project below 75% percent of the new appraisal asl well?

Quote from @Kevin Woodard:

I think planning backwards from your desired end state will allow you to know what you need to ask for and plan now. What is the income you're looking to net? Conservatively speaking aim for a DSCR greater than 1.00, let's call it 1.2. That will give your PITIA… so on and so forth.
Another place to build in some room for error is ARV aim to keep the total cost of your project below 75%, 70% and you're marginally safe. The last bit would be a safety margin with construction in the event things don't go as planned.

0 Votes

Orlando, Florida

What should I consider when using a hard money loan (HML) to purchase a property below market value, using the HML to finance 100% of the rehab, and finally refinancing into a 30 year mortgage afterwards.

I want to make sure I am thinking through each scenario and not missing any expenses

0 Votes

Orlando, Florida

I’m getting mixed messages from Lenders. I guess it depends on the lending company whether they allow “gifted funds” or not

Quote from @Greg Scott:

If you are treating John as a lender, he doesn't need to be in the LLC. The note itself outlines your relationship.

0 Votes

Orlando, Florida

Hey Josh--I'm wondering the same thing, I am interested in doing fix and flips with investors. I would create the LLC but the investor is solely responsible for the upfront costs of the project. I oversee everything else.

0 Votes

Asheville, North Carolina

Hey all! I have investors interested in getting into the deals I come across. I'd like some help with structuring the partnership.

For example, let's say John wants to invest $50k into a property I want to purchase.

John and I form an LLC and those funds would be deposited into the LLC through which the property is purchased. I then have a lawyer form a promissory note for the loan terms owed to John upon the flip of the property.

Is this a "smart" way of going about this? Seeking a hard money loan.

0 Votes

Orlando, Florida

Does anyone have a contract or partnership agreement template they use when purchasing properties? We have 3 scenarios:

1. Investor wants to give us a loan for $50k with jumbo loan payback terms. We'll use the loan to purchase a new property.

2. Investor wants to put all down payment and closing costs down ($50k total) to acquire a property while we oversea the renovations (sweat equity). We'll go in on this deal 50/50%

3. Crowd funding - 5 people want to put in $10k each ($50k total) to purchase a home.

Does anyone have a partnership agreement they can share with me for either circumstance? Or something similar? How do you go about it when it's multiple partners? Do you open a new LLC with all partners? I'm open to all advice. Thanks in advance!

0 Votes

Orlando, Florida

Thank you Alex! This helps me put things into perspective a bit. Can you speak more about your experience with JV? What’s an example of this? Something like I bring the sweat equity and they bring the money sort of thing?

Quote from @Alex Breshears:

Hi Samantha! I just wanted to offer some insight into what you are asking for, in the way to show I understand what you are asking for. You are obtaining a first position lien with this DSCR lender, but then wanting someone to come in with a second lien for not only the downpayment (so there is no equity buffer at all), and then renovation costs plus closing costs (so essentially the lender in second position is going to owe more on the property than it is currently worth at the time of closing). I only bring this up because I am giving you an idea of how a private lender sees the numbers in this deal. Think about if something happens to that first lien and it goes into default. The interest charges, legal fees, etc will very quickly eat away at any equity buffer there is in the property, so the second lien holder has a high chance of being TOTALLY wiped out. Honestly, this might be a great situation to look for a JV partner so that way they have some of the upside potential and a say in what happens with the day to day for the property to make sure renovations happen, the value keeps climbing so their capital isn't under water. Just my two cents! Good luck to you in finding something!

0 Votes

Orlando, Florida

yes the property is in good shape now but I'd like to update the kitchen and bathrooms.

0 Votes

Orlando, Florida

Hey everyone! I'm seeking a Transactional Money Lender to cover down payment, closing costs and renovations for a property I'd like to purchase. Amount would be $85,000. Here are some details:

Purchase price: $280,000

*Down payment 20%: $56,000

*Closing costs (estimate): $10,000

*Renovations: $19,000

* = Transactional money lender needed for these items

I'll be using a DSCR loan with a 30 year fixed for this property.

I appreciate any referrals for for $85,000. Thanks in advance!

0 Votes

Orlando, Florida

All Forum Posts by: Samantha Baker

Samantha Baker has started 5 posts and replied 11 times.

Post: HML refinanced into 30 year?

Post: HML refinanced into 30 year?

Post: HML refinanced into 30 year?

Post: LLC formation with Investors

Post: Partner Agreement Help

Post: LLC formation with Investors

Post: Investor Contracts Needed

Post: Transactional Money Lender

Post: Transactional Money Lender

Post: Transactional Money Lender