All Forum Posts by: Tyler Lynn

You have a great plan and the right idea going for a 4-unit, my first house hack was a duplex and I wish I would've went with the quad! However you won't be able to simply change the loan to conventional after a year, you would essentially be turning this into a conventional investment loan since you won't plan on living there anymore, meaning you would've needed to build up to 20% equity in the property. I'm not sure with it being new construction if they will allow you to use rental income, I would definitely reach out to a lender about this. Local credit unions can be a little more flexible if you build relationships with them. Good luck!

I agree with Arn, looking for distressed properties is your first step. This is already going to increase your success rate. If you are blindly calling properties, the success rate will be quite low regardless of your strategy. I have found the most success with cold calling over letters or voicemails, but they all work over time, it's a numbers game!

I don't know how many units this is, but a good rule of thumb for your expenses will be around 48-52% of the income. That number is before your mortgage payment and interest. That includes your management and the other items you included, so I don't believe you are far off that number, but I would also always keep vacancy, loss to lease, bad debt, etc. at 10% just to be safe. Especially at times like this. Either way it could very well be a good deal. Good luck! 

It definitely depends from operator to operator. Some operators will do long term holds and never want to sell, but I agree it is a little less common these days. But one reason being that yes they have a well producing asset, but they have built a tremendous amount of equity in the deal and could roll that money into the next big property that has a value-add component. So it is less like flipping homes, where you are selling for the sole purpose of making money, but here they are selling to buy potentially more units with more opportunity to force appreciation and equity through value-add. But again if you look at a county's properties list you will see that plenty of properties have been held for longer than 10+ years and some owners do see the long term advantage behind it. Either way you do it syndicating apartment complexes or simply investing in multifamily can be extremely fruitful from all strategies!

I would definitely recommend local community banks! I'm not in your area so I don't have any specific recommendations, but I was just on the phone with a local credit union the other day and they are specifically looking for long term hold assets. They were more than willing to go longer on the amortization as they are long term lenders who want to hold the loan for a while. Again there may be prepayment penalties so it depends on what your business plan is on your properties.

There are so many ways to succeed in Real Estate, so this question/answer should definitely be based on the deal and person. If you have the capital to purchase properties with all cash and are happy with those returns, that's what you are comfortable with. To me if you are looking for the best of both worlds I would recommend leveraging the asset just 40-50%. You will in no way have to beg for a loan, as most any bank will lend on those terms and give fantastic rates. It also gives you the ability to scale a little faster. 

There is also the theory that there is actually more risk when you put 100% cash into a property. If a property you bought cash depreciates 50%, you have lost all of that money for the time being. If you leverage a home and say only put down 20%, then as long as you hold it long term when the home depreciates you are really only risking that 20%, just 1/5 of what you put down with all cash. Either way you can be successful and you should base your strategy on what you are most comfortable with. Good luck!

I actually love the 2bed 1bath and 1bed 1 bath apartments. I feel that they have a huge demand and get you the highest rent per sqft! Especially 1 bed 1 bath, in a lot of markets there is a ton of demand and not enough supply so you will see a lot of communities being built with majority 1x1s. 

One of the worst things in business, not just real estate is dealing with people who are going to lie to you. And in many cases like yours you could very well have a case to get your money back. However, it very rarely is worth the time and money it would cost to get this through attorneys. As Arn said your best bet will most likely be to spend your money to resolve the situation on your own. While it takes swallowing some pride I would recommend paying the tenant to leave (cash for keys). And you can add in that you are waiving the money they already owe you instead of filing eviction. This should give them enough motivation to move out peacefully without tearing up the place or fighting you on leaving. Either route you take, good luck!

That's good you are wanting to get out there a meet people, I got lunch with a broker the other day and they were surprised said even before covid no one wants to take the time and get lunch lately. This is a relationship business and doing these things can get you a long way. Something you could offer is if they are working in their office, is bring them by a coffee or lunch to have a quick chat if they are comfortable with this. Another thing is to make your questions conversational. If you can work questions into a conversation rather than just start listing off questions this will make it seem a lot less like an interview where you are the only one benefitting to just a conversation where you are getting to know each other. 

Start by looking up the county's property appraiser website, once there you will either have the owners name or the LLC's name that they bought the property with. If it is under an LLC use the secretary of state's website to find the agents of the business. I use truepeoplesearch.com to skip trace this information to get the owner's phone number.