In this week’s “How Did They Do That” we talk with Mario and Doug D’Attillo, a father-son team from Florida who networked with some students at one of our events and landed themselves a 144-unit property! Mario and Doug talk about how their found their first deal, the cash flow generating from this property, and how they raised $1.2 million for their second deal!
In this new episode of “How Did They Do That” David Lindahl catches up with Omar Ruiz from California on a 32-unit deal in Houston, TX that rewarded him with a $20,000 acquisition fee and almost $1,000 a month in cashflow! Omar talks about how he found the deal, what he did to raise $200,000 to close the deal, and has some useful advice for investors that are looking to do more deals in the future!
What is a Sponsor?
Hello my name is Jeannie Orlowski welcome to the first edition of 60 second insights. In this series we are going to answer burning questions in 60 seconds or less.
A sponsor is someone who qualifies you for the mortgage amount. If you have a three million dollar property you are going to put 20% down. You will need to have the net worth equal to 2.4 million or the bank may require you to have a sponsor. They also may require you to have up to six months liquidity for mortgage payments- that you can co-sponsor with your sponsor who qualifies you for the mortgage.
Sponsors are everywhere. You can find them at local real estate investment club, you can find them in your own neighborhood, maybe even in your own family. People that just want to get a piece of the deal. They don’t want to do all the legwork that goes into getting a deal under contract doing the due diligence getting all of the necessary documents together in order to close on a property they just want to put up their tax returns and get a piece of the deal and that’s how you find sponsors. If you have any questions regarding sponsors, private money or any other burning questions leave it in the comment section below and perhaps next week we will be answering your burning questions.
60 Second Insights – Funding Deals
Today’s question is, how do I fund my deals?
Hard money is secured by real estate. A hard money lender typically will charge a 11-15% interest plus points. A point is 1% of the loan amount. They will get interest on their money every month until you are out of the deal which is typically under a year. Debt partners- a debt partner usually comes into the deal in a promissory note. They typically charge 10% interest, they get paid on an annual basis and they are in the deal for 2-3 years then they get their money back. Equity partners-this is the way savvy investors invest in real estate. It’s a syndication you’re portion 100,000 dollars, you would get 9% first year, 10% the second 12%, the third that is 31% cash on cash return from what we buy the property for to what we sell the property for, you would get another 50% of that. Add the figures together, divide by 3 and you get a 27% annualized return. Bingo! You’re in. That’s the way serious investors invest. Got a burning question? Leave it in the comments section below. And next week we might be answering your question.
Today’s question is how to invest in real estate with your IRA.
First you pick a custodial account such as iPlan, equity trust, Pensco. Then you have to find a brokerage account such as Fidelity or TD Ameritrade or one of those.
Then you have to roll the money from the brokerage house into the self-directed IRA. Once it’s there, you want to get your paperwork in order. Once you get all of the documents in place in entity DOR that needs to be filled out in order to get the money in place and a custodial account will take over. You need your property package, subscription, operating and questionnaire in your articles for organization to make this all happen.
Got a burning question?
Leave it in the comments section below and next week we might be answering your question.