All Forum Posts by: Jacob St. Martin

Hello Keith, I believe that you only get a number of free searches. After that you get a discount on purchasing a subscription on airdna

I go to the meetup in Charlottesville! We meet at the Omni Hotel on the second tuesday of the month at 5pm. I am also always looking to connect with other investors!

Hello Gustavo! First, to my knowledge you do not need to own any property to utilize a DSCR loan. Depending on the lender you talk to they will either look at the finances of the deal and ensure that their will be enough cash flow and/or they will look at your personal finances to see if you have enough reserves and can make the payments if something goes wrong. Since you don't have a track record they definitely will look at your finances and will want you to have healthy reserves.

Alternatively, you could look into private money or hard money. If you want to get the purchase price and rehab financed this is the way to go. However, you are going to pay a lot for access to that money. Without having a track record the terms you get will most likely be 3 points up front and a 12% interest rate, interest only payments, with a 12 month balloon. If you are planning to refi into a conventional loan, the seasoning period is now 12 months so you would be paying $9,000 up front as a fee and $36,000 in interest over that 12 month period. If you refinance into a DSCR loan you don't have to wait 12 months and can avoid paying a lot of that interest.

I will say that I don't see any holding costs in your calculation. You need to factor in your debt and utility payments for the time between closing and refinancing. Especially if you use hard money, this could be substantial enough to kill the deal if you don't plan for it. 

I hope this is helpful, feel free to reach out if you have any additional questions!

Hey Margaret, sounds like a great deal. how are you planning to get around the Albemarle County STR restrictions? Technically it is supposed to be a primary residence of the owner and owner occupied for 180 days of the year.

Hello Jesse, if you get a conventional loan on a property the lender will include a clause called the due on sale clause. This means that upon transfer of the title of the property the bank reserves the right to call the note in full. This means that technically, if you transfer the property to an LLC the bank could call your note. In practice, I think banks ALMOST never do this. If they have given you a mortgage and you are paying it on time every month why would they care if you transfer it to an LLC, they are making their money. It is up to you whether or not you want to take the risk, but from what I understand the bank will basically never call the note unless the bank is in crisis and they need liquidity and then they might start calling notes. As far as the cost of transferring to an LLC I am not sure but I think it is pretty minimal.

If you are just getting started and want the great benefits of low money down conventional loans I would recommend just putting them in your name for now. Once you build equity you could refinance them into a new conventional loan with your LLC or refi into a DSCR loan with your LLC.

Hello Jarred, it is never stupid to explore your ideas! They will either be good ones or bad ones that you will learn from so that your next one is better. I have a couple of questions here and comments here. First, where will your parents live? Are they planning to move or downsize? Are you planning to continue to have them reside in the primary part of the property? Do you live with your parents? Do you plan to live somewhere on the property?

Assuming that your parents will be staying where they are and occupying most of the property, it sounds like the only part that wouldn't be occupied is the potential mini apartment. I would get that fully set up as a mini apartment and operate it as a short term rental. 

If your parents aren't going to be in the house anymore list the main house as a short term rental and either live in the mini apartment or have that as a second STR.

One general piece of advice is that it sounds like you are thinking about the property like a home owner and not an investor. The first question you should be asking is, "How can this property generate income/the most income?" Then move on to "What renovations need to happen in order to tap into the income potential of this property?" With every renovation you do you want to have a specific purpose. For instance, in order to turn the man cave into a mini apartment you might need to add a small kitchen or add a closet to make something a legal bedroom. Or you might be adding an addition to add livable square footage and build a lot of equity. If you can't find a specific reason like this then you are probably making the decision with your heart not your head. For instance, unless you are trying to run a very high end luxury STR or the other homes in your area have high end landscaping, doing a huge landscaping job is probably not going to add much equity or increase your cashflow much.

Another thought is that you don't necessarily need to buy the house from them to do this stuff. What if you just converted the man cave and listed it on airbnb and shared some of the profit with your parents. Or if you are set on buying it maybe see if they would do seller financing so that you can get better terms and don't have to go through a bank.

I hope this is helpful! Feel free to reach out if you have other questions

Hello Matthew, I think that college markets are some of the absolute best markets in America. You are nearly guaranteed strong rent growth, population growth, and appreciation. The closer you are to the campus the better. The main things that I would take into consideration is that you may need a higher than average repairs budget and you will be turning over tenants a lot. If you are self managing that means that it is a little more work. If you are using a property management company, they often will charge a fee for each tenant turnover so that can eat into your profits. However, at least in Charlottesville VA were I am students need to sign leases about 9 months in advance to find a decent place. If you aren't lazy you will never have a single day of vacancy.

Hello Tyler, I am a real estate investor in Charlottesville VA. People have had success here with MTRs due to the demand from the UVA hospital. If you would be interested in this market lets definitely connect!

I think that you should, either your potential employers won't care or they will see you as hard working and responsible for being a real estate investor. I don't see how it could hurt

Hello John, welcome to BP! I am based out of Charlottesville VA. I would love to hear about what kind of investing you are interested in!