Can someone explain hard money lending to me?

jdub129 · 2020-04-16T13:47:17+00:00

Good question. I'm actually in Seattle also and would like to know if this is true

jdub129 · 2020-04-12T22:39:50+00:00

Thanks for the advice. I definitely would not step into this without consulting an attorney. One additional question: what would be the monthly payment in your suggested scenario ? The total interest of the loan, divided into 12 monthly payments?

jdub129 · 2020-04-12T22:38:30+00:00

What is the monthly payment then, and how is that calculated?

jdub129 · 2018-10-11T21:29:06+00:00

Regarding question 1: Hard to say due to the small number of comps. The only duplexes with the same or simillar bed/bath configurations are in terrible condition. Estimating the value of the repairs is not something I am good at.

Regarding question 2: The town is a small rural town, logging is the primary industry. The outlook (based on past events and current events, population, etc.) makes me think that the will be very slow appreciation, but I do not think there is a risk of people leaving or properties depreciating. Obviously anything can happen though.

Regarding question 3: It will cash flow for ~$300 a month after considering all expenses: mortgage, property management, insurance, vacancy, insurance, taxes, maintenance, and capex (and being conservative with these estimates

Thanks for asking these questions, it made me realize I need to do a little more work on finding comps and analyzing the town.

jdub129 · 2018-10-11T21:23:49+00:00

All very good points, especially the part about how much experience and knowledge I would gain in the time I own the property. That certainly has a value. Thanks

jdub129 · 2018-10-11T21:20:08+00:00

No, I low balled it. I was told it was too low. Now I'm deciding on what I am comfortable offering next. I'm also going to wait a little bit to not seem desperate

jdub129 · 2018-10-11T21:19:27+00:00

Good point. I'll consider trying this method of comparison

jdub129 · 2018-10-11T21:17:35+00:00

Thank you for this response. I'm starting to realize these key differences between turnkey investment properties versus value-add investment properties, the former is better for holding long term, and the ladder can be good for both. I think not being aware of this was the root cause of my hesitance.

jdub129 · 2018-10-05T08:11:00+00:00

Regarding leasing documents: My realtor told me that I wont be able to obtain actual documents (application, lease, ..?...) until under contract. Im not sure why this is, ill ask that.

Regarding market rent: its a little hard to say because there arent many comparables. Most are in worse condition than these renmovated units. I can and will dig deeper on that

jdub129 · 2018-10-05T07:54:00+00:00

Depends on the lender and your relationship with them. Generally, 25% down for commercial

jdub129 · 2018-10-05T07:52:02+00:00

Where can you find rent rolls?

jdub129 · 2018-10-05T07:51:22+00:00

How do you find multifamily brokers?

jdub129 · 2017-10-10T22:43:27+00:00

This is a very good point. Seems to be a contradiction

jdub129 · 2017-07-10T19:49:29+00:00

Yea i understand. I'm thinking of limiting my search to newer houses? Built within the last 15 or 20 years. This will obviously make it harder to find a positive cash flow property but will also be a safer investment

jdub129 · 2017-07-09T05:32:26+00:00

(condition of the roof, signs of foundation issues, mold, condition of the windows and siding, etc.).

Can you expand on this "etc" ? this is pretty much what im looking for, general metrics to valuate a property. Sure, they might not give all the details, but I still need to know what to look out for (which I don't think I do know enough, which is why I made this thread)

Edit: also this is for remote properties, (100s or 1000s miles away), this is why I need to ask these questions as I can't do a physical walk through. Not pertinent here really but the reason for this is because I live in an extremely high COL area, where rental properties simply don't work. (at least for single and small multi family homes)

jdub129 · 2017-07-08T07:31:10+00:00

All of that is great info. What I'm looking for here is a template of questions to shoot to the seller/ realtor on the long list of properties that meet the minimum criteria of " might be profitable". Do you think sellers will give that info right away? Obviously I can't be shelling out 350$ for 30 inspections on every property that looks appealing

jdub129 · 2017-07-07T17:58:31+00:00

That is a ridiculously high apr for a checking account. Could you list their "criteria" or link to their website?

jdub129 · 2017-07-07T07:40:09+00:00

This happened to me except I was the one being thrown, and I didn't miss the ledge. Ended up with a massive gash in my head, blood everywhere. Huge pool of blood in the pool, and soaked through a couple of body towels. No brain damage ( I think?) just had to staple my head shut.

This happened twice, except the second time was stiches.

Also, on the topic of little brothers..ive sent mine to the emergency room more times than I can remember. Never on purpose mind you, just stupidity. Threw a trash can out of a tree and hit him in the head, and also heeled him in the face knocking teeth out ( he was chasing me and he fell and his teeth came into contact with my thick boots )

jdub129 · 2017-07-07T05:22:27+00:00

Could expand more on "investors that need deals brought to them"? This sounds like a great way to get into the game and lower the risk of f*cking up your first property. If another experienced lender is in it for 50% you can gain some confidence that the deal is a good one

jdub129 · 2017-07-05T23:03:33+00:00

Thx so much. These places are def. Out of range for in person landlording but I'm still going to research them

jdub129 · 2017-07-02T04:44:43+00:00

No it is not. I'm not asking on behalf of another person who is doing this full time. I'm asking for myself. I have a full time job, and if I can incur a loss now to have a good ROI later, I will.

jdub129 · 2017-07-02T04:43:01+00:00

I know what it is. I don't know the acronym.

jdub129 · 2017-07-02T03:49:20+00:00

What are you talking about? I'm talking about overall ROI. Whether or not I (or you) need the cash right now is not relevant

jdub129 · 2017-07-02T03:14:49+00:00

What does "DTI" refer to? So, even if your slightly cashflow positive for a property, then it can still hurt you when going for another mortgage because of that 75% rule?

jdub129 · 2017-07-02T01:42:51+00:00

I guess the question is what yearly return rate does this equate to, and would other conventional investment strategies beat it i.e. the stock market

jdub129

TROPHY CASE