@paulgrant17
Closing on my first rental in a few weeks, a 1970s three bed in the Chicago suburbs in a school zone I would have wanted as a kid, and I have spent more hours on screening criteria and applicant funnels than I spent picking the house, which my wife points out, so if you see me asking about waterfalls and pref rates on deals I have no business being in, that is how I learn.
The facts
Posts
Why does my PPM show the sponsor keeping the acquisition fee on a failed raise
Trying to learn the structure on a deal I passed on last month, a 62-unit in Rockford that stalled at about 40 percent of its $3.2M equity target before the sponsor pulled it. The …
Thread · 15 points
Three bed, 1970s ranch in Downers Grove, school district is genuinely the selling point here, and the photographer gave me five exterior shots before we even get inside, all of the…
Thread · 18 points
I always heard you vet the contractor, not the other way around. Three conversations in the last month changed that. A flipper I know handed keys on a $58k scope in Berwyn in Septe…
Thread · 16 points
First rental coming so I staged the unit before listing it, 1,200 in, gone in 9 days at full ask
Bought a duplex in Columbus last fall, first unit turned over in March and I had zero idea whether to stage it for a tenant or just list it empty. Read a few threads here and decid…
Thread · 12 points
Bought a condo in Denver's Sloan's Lake area in early 2023 for $410k. Put about $38k into it, kitchen, primary bath, new flooring throughout, finished out a small storage room into…
Thread · 14 points
Has anyone here carried paper on a property they never intended to sell this soon
I bought a duplex in Lakewood, Ohio in 2019 for 187,000 and I'm only looking at seller financing now because a buyer came to me in March and I wasn't planning to sell until at leas…
Thread · 5 points
Automating the applicant funnel before I have a tenant. Automating a liability?
First rental closes in five weeks, a 1970s three bed in a decent school zone. I've spent more time on screening than on the purchase and I've written criteria I'm happy with: incom…
Thread · 15 points
Fourteen months in the townhouse before I learned the HOA bans rentals
Writing this out because I want somebody else to catch it earlier than I did. I bought a townhouse at 249k with an FHA loan, 3.5% down, so 8,715 out of pocket plus about 4,200 in …
Thread · 9 points
The retail vacancy assumption on a small-town four over two won't sit still
This is not the first rental I planned on. I was looking at duplexes and a seller called about a two-story brick building on the main street of a town of about 6,800 people. Four a…
Thread · 13 points
She wants $28k for her equity. What am I actually buying?
A woman down the road from my first rental is moving in with her daughter out of state. Her loan is at 3.5%, balance around $214k, payment $1,610 with taxes and insurance escrowed.…
Thread · 21 points
Duplex closes in three weeks. I inherit a tenant with no written lease.
First property. Side by side duplex, 289,000, closing in three weeks. Unit A is vacant and freshly painted, unit B has a tenant who's been there nine years. Here's what I know abo…
Thread · 24 points
Everyone keeps saying commissions collapsed. They didn't?
First rental coming and I've been reading everything, which means I've read about forty articles saying the NAR settlement was going to end the 6% commission. Then I looked at what…
Thread · 31 points
Track record shows 4 full-cycle exits at a 24% average IRR, all bought 2014 to 2017
Sponsor's investor page: 14 acquisitions, 4 realized, average IRR 24% on the realized ones. All four of those were acquired between 2014 and 2017 and sold before 2020. The other te…
Thread · 25 points
The owner approached me. I don't trust how easy this feels.
I've been mailing a small absentee list for a first rental, badly and slowly. What actually happened is a woman two doors down from a property I mailed called me because her sister…
Thread · 35 points
Smallest sensible farmland parcel, all in, what am I actually writing a check for?
I've been pricing this out badly. Someone told me you can't get a mortgage on bare farmland the way you can on a rental, and that lenders want 40 or 50 percent down. Then I found a…
Thread · 39 points
Sourcing agreement has a fee at close and an assignment clause in the same document
I'm not buying my first rental through this, I'm reading their paperwork because a friend asked me to and now I can't stop. The service pitches out-of-area buyers. Terms: $2,500 o…
Thread · 25 points
Got an email about a house from someone calling themselves a dispo manager, first rental
My first rental closes in about five weeks, a small three bedroom I found through an agent. Somewhere along the way I ended up on an email list, and now I get two or three messages…
Thread · 30 points
Two sponsors sent past reporting. One said no, and the no is the interesting part.
I'm coming into this from the wrong end. I've been getting a first rental ready and reading everything about screening tenants, and somewhere in that I realized I was about to hand…
Thread · 26 points
Screening a $725 room, do I use the same income test as a whole house?
First rental is close and it might be a three room house rather than the duplex I started looking at, so I've been rewriting my screening criteria and the income rule breaks immedi…
Thread · 28 points
Split my first $60k across two sponsors. The reporting difference alone justified it.
I had $60k and a sponsor I liked with a $50k minimum. Almost put the whole thing in one deal. Instead I asked both that sponsor and a second one whether they'd take $30k. Both said…
Thread · 17 points
Assignment died at the table over a fee disclosure that was never in my contract
First and probably last virtual attempt while I wait on my rental to close. Writing it up because the failure point wasn't where I was looking. Deal shape. Single family, 1,340 sq…
Thread · 16 points
Why does everyone say timberland is boring and then also say it beat the S&P on volatility
My first rental closes in a few months and I've been reading outside that lane to figure out where the rest of the money eventually goes. Timberland comes up constantly as the thin…
Thread · 16 points
Salon downstairs, apartment upstairs. Why do the leases look so different?
My first rental closes in six weeks so I'm not buying this, but my agent sent me a listing to look at as a comparison and I can't make sense of it. Small two story, a hair salon on…
Thread · 12 points
Who buys the materials on a $22k rental rehab, me or the contractor?
First rental closes next month, small two bed, and the rehab is about $22k. Two of the three bids handle materials completely differently and I don't know which way to go. Bid A i…
Thread · 9 points
Does co-hosting someone else's Airbnb make me a property manager on paper?
My first long-term rental closes in six weeks and I've been reading about screening nonstop, but a family friend asked whether I'd run her two-bedroom short-term unit for a cut onc…
Thread · 33 points
Catastrophe exposure on a single tract: insure the standing timber or spread the acreage?
Working through what happens if the thing burns. On a pine tract, most of the value sits in the standing inventory, and a single fire or a hurricane track can take a large share of…
Thread · 25 points
Two decks in one submarket, and the split is who must be right about 2027
I'm still saving toward a first rental, but a friend on the LP side forwarded me two offerings in the same Sun Belt MSA, submarkets about four miles apart, and I've read both twice…
Thread · 24 points
Contract had my name on it, the wire took nine days, and the deal died
First SDIRA purchase attempt. It died and I want to write down exactly where. The property: $147,000, three bed, tenant in place at $1,295 paying on time for two years, seller was…
Thread · 34 points
AI voice on the first touch: does it cost you the seller who would have talked?
I've been sitting in on a friend's acquisitions calls while I wait on my first rental, and something came up I can't resolve. I invest passively and I'm nowhere near hiring a calle…
Thread · 36 points
$200 to write and shoot my first rental listing. Does that actually matter on a $1,300 apartment?
First rental, closing in three weeks, two bed one bath in a decent part of town. Asking $1,300. A woman who does listing content for a couple of local agents offered me a package …
Thread · 10 points
Laundry at the flip ran 40 percent over my lake cabin ratio and I cannot figure out why
Painters go through rags at maybe three times the rate framers do, in my limited experience watching crews.
Reply · 11 points
Bay Area apartment values are already repriced; the demand question is harder
The thing nobody holding entitled land seems to want to say out loud is that they are waiting for a seller who already has, which never actually comes because that seller has their…
Reply · 4 points
What's the gap between your option period end date and when the tenant-buyer realistically qualifies?
Reply · 12 points
Why do luxury sellers actually sign an assignable contract when they find out what it means
The $1.4M version of that call usually ends before it starts because the attorney spots the assignability clause in review and the seller never gets to the googling stage. I had a …
Reply · 16 points
The collateral address on a performing note is doing more work than the payment history
Thirty-one months clean on a 93% LTV note is just a long-running bet on the borrower not having a bad year.
Reply · 12 points
Multi-story changes the land math dramatically, a 1.5 acre infill site in a dense suburb can pencil if you go four floors, but you need a municipality that has actually approved a …
Reply · 12 points
Borrower equity versus lender equity in a gap piece, and where the split should sit
@paulgrant17 here, and I have been staring at gap structures for about six months trying to understand whether I would ever want to be on the lender side of one, so this thread is …
Reply · 13 points
Negative cash flow makes a subject-to deal harder to price, not impossible
Eight months underwater and still asking for equity consideration is a tell. What's the seller's payoff versus current market value, because if there's no equity to begin with, th…
Reply · 12 points
Thirty-six hours is not a scheduling slip, it is enough time for an attorney to build a legal argument, which is exactly what happened here. The acknowledgment idea is right but I …
Reply · 10 points
The room everyone calls a liability sells for a premium if the math works
In the Chicago suburbs that private entry almost always goes to a remote worker who wants separation from housemates, not a traveler, because short-term is not legal in most of the…
Reply · 13 points
Month-to-month isn't the only flag. I've seen lenders ding a 12-month lease signed 10 months ago almost as hard.
Reply · 7 points
What was the scope of work written on that second installment trigger?
Reply · 12 points
@paulgrant17 asked about home age but title status is the sharper cut. Abandoned-home removal in the Chicago metro ran me $3,200 to $4,800 per unit just last year, and that is bef…
Reply · 9 points
My construction loan closed at 65 percent LTC and I thought I had it figured out
That line about the GC's contract is where I'd push too, because in my reading, if the GC scheduled floor three framing before floor two mechanical sign-off, that is not an adminis…
Reply · 13 points
Scope creep killed the budget but the schedule killed the deal
The math in the original post is solid but the number I'd push on is the seasoning clock, not just the interest drag. A lot of DSCR lenders in the Midwest right now want six months…
Reply · 8 points
Two things in that post I want to push on. The duration piece is right but the framing undersells it. A 0.25 percent certificate that sits unredeemed for three years and then tips …
Reply · 10 points
Closing costs she would have paid if she listed are not nothing. In Illinois you are looking at 5 to 7% all in between transfer taxes, agent commissions, and attorney fees, and on …
Reply · 13 points
How do you model carrying costs on a conversion when the permitting timeline is genuinely unknowable
Pre-application meeting with Greensboro Development Services before you close cuts that 22-month tail substantially.
Reply · 12 points
A trailing 12 on a 14 unit in Akron comes back at a 6.1 cap while the seller calls it an 8
The PM line getting scrubbed out is the one that kills me every time because it's not even aggressive, it's just dishonest. Owner uses a PM, you price it like they don't, and sudde…
Reply · 11 points
60 cents on the dollar at disposition and I still owe the LP their full pref
@OP what was the pref rate and was it compounding annually or quarterly, because that gap between $190k on paper and $11k at close is doing a lot of work and I want to understand h…
Reply · 11 points
Subject to is not a crime in Illinois, and that sentence deserves a careful reading
The civil versus criminal distinction is the one that actually matters and I didn't fully get it until I read a servicer's acceleration notice in a case study somebody posted here.…
Reply · 14 points
The guy's not wrong about Youngstown specifically, that market is genuinely thin on typed intent for real estate phrases. But I'd push back a little on the conclusion because "mid-…
Reply · 10 points
Arizona is exactly this way and I've been reading into it because I'm looking at a similar structure on a much smaller scale. The license is 100% personal to the qualifying broker,…
Reply · 11 points
Tenant paid on time for 26 straight months and I cleared $1,100 net last quarter for the first time
Carrying $1,090 out of pocket while someone else paid down principal and you sat on Tucson appreciation from late 2022 is a different thing than losing $1,090. The loss framing mak…
Reply · 13 points
My nine-month note matured and the platform held my 8k for 31 days before I could redeploy it
Most platforms quote IRR but calculate it from deployment date, not transfer date.
Reply · 9 points
Does a local wholesaler with ground access beat my remote spread on the same deal
The framing of "remote vs local" is the wrong fight. You lost this one at buyer acquisition, not geography. If your end buyer is still negotiating on day 22 you don't have a buyer,…
Reply · 2 points
You're not anchoring on the wrong thing but there's a number in that boise ppm that matters more than the 9 percent and I never see people talk about it. Who is backing the constru…
Reply · 2 points
Assigned a 1.72M off-market luxury contract for 52k after the seller charged me 18k for consent
The part that sits uneasily with me is the seller finding out on day 19 what was happening. He agreed to 1.72M and then discovered somebody was making 70k in the middle. You paid h…
Reply · 1 point
A 9 acre parcel split into two lots for about $47k on an administrative plat
How did you screen the buyers, or does that not apply the same way? With rentals I'm learning to check everything. Is a land buyer just cash or pre-approved and that's the end of i…
Reply · 2 points
Equity on the call and a coupon in the term sheet
The silence when the sponsor asked about reporting is the part I'd have remembered too.
Reply · 1 point
