My Brother-In-Law needs help (Real Estate Investment Fund) - Page 3

Phone Booth · #21 09-07-2007, 05:09 PM

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I don't know if its you or not, but i've tended to have a difficult time finding financing for my deals. I'm sure that I can be done, and I have developed some relationships with smaller, local, portfolio lenders to work with me on some deals.

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As in I know from people who work in commercial mortgage space (origination and securitization) that underwriting standards have become extremely lax, especially for conduit loans. It's possible that your scale was a bit small (it'd be difficult to justify the upfront costs with loan amoutn less than $500,000), your properties/situation a bit non-standard (small loans that can't be securitized aren't nearly as marketable), or you just didn't shop hard enough. Still, 20% isn't exactly hard to beat.

Butcho22 · #22 09-07-2007, 11:40 PM

Thx a ton for all the info guys.

I'm going to have him read all this tomorrow when he gets back from the hospital.

Much appreciation.

Tien · #23 09-09-2007, 01:02 PM

Hey spex, didn't know you invested in Real Estate.

Where do you live and what kind of properties do you buy?

spex x · #24 09-10-2007, 10:20 AM

I live in Kansas. Historically I do small rental properties - mostly 2-4plexes, some SFHs. I've never found great cap rates on bigger units in my area, so I've stayed away.

About one year ago I started working in the mobile/manufactured homes business, and that has taken off pretty quickly. Now I'm pretty much only doing that stuff - trying to buying MH parks, developing parks, developing manufactured SFHs on land, etc. I like that compared to stick-built construction, manufactured is only a fraction of the work, cap rates are always double-digit, and management is much easier.

I know that you do flipping, right?

OP, sorry for hijacking your thread.

spex x · #25 09-10-2007, 10:32 AM

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Still, 20% isn't exactly hard to beat.

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Yes, I know. But I'm not looking for financing - I'm selling notes at a discount that will yield 20%. Thus, my investors get a 20% return, and the payments are guaranteed by my company. Perhaps paying 20% is a bit too high, I don't really know. Perhaps I'm leaving money on the table. But my yields AFTER I pay my investors 20% are still hover at around 80%. And I NEVER hurt for the money when I need it. I make a call or two and I've got the cash, end of story. It works good for me.