I'm a broker who is transitioning to a landlord but am scared people won't send me deals because I used to be a broker.. how would you suggest getting around this? Furthermore what is the best way to structure financing without a consistent income?
As mentioned above
[{"id": "g8i7ezo", "text": "I'm based out of NYC in case that matters", "replies": [{"id": "g8ngryj", "text": "I am a CRE Broker in NYC. Most brokers wont send you off market deals because they would assume that if you dont have interest in a specific deal that you will just pass the lead on to another broker who may be a friend (happens all the time). \n\nOnce you make a purchase and your name is in the comps the deals will start flowing. For now I would suggest you try to build a relationship with a few brokers and remove your association with the brokerage you are currently with.", "replies": [], "depth": 2}], "depth": 1}, {"id": "g8i9l9q", "text": "I'm also a CRE broker. You have the advantage of knowing how to underwrite and analyze deals yourself. Similar to finding listings you gotta find the deals yourself.", "replies": [{"id": "g8rsn0k", "text": "I'm still a broker, but mainly for office in NYC, however I have no intention of buying any of that anytime soon, I am right now looking to buy multifamily for myself", "replies": [], "depth": 2}], "depth": 1}, {"id": "g8ibeyi", "text": "What type of landlord? Single-family? Commercial businesses/leasing?\n\nI have 8 single-family homes. I am a real estate agent. I also do private investment pooling for a local builder who hates banks ever since \u201808.\n\nI use his method. One bank told me \u201cno\u201d even though my NOI is about $75,000/year (on paper) and assets sit at about $500,000 (if I got my properties appraised which I have never done). \n\nI have done private loans even since. One guy, 6-8 year notes. Competitive rates. Better yet, no origination fees or any of that bullshit.\n\nNobody goes out and sells good rentals. You have to meet some landlords. I have bought every property of mine from existing landlords.", "replies": [{"id": "g8idceq", "text": "I'm looking at 4 family and up,  or bigger and rent stabilized", "replies": [{"id": "g8idee8", "text": "All multifamily for now but maybe warehouse down the line", "replies": [], "depth": 3}, {"id": "g8idkbk", "text": "4-plex great. \n\n5-plex sucks. That\u2019s the line you cross into the commercial world. Insurance goes from $1,000 annually to $5,000 annually. I learned trying to buy a 5-plex for cheap ($180,000).\n\nI have a pole barn I rent commercially. 1,600 sq ft. 24\u2019 tall. New concrete floor. 1/3 of it rents for $800/mo. Typically you would charge a lot up front for a commercial lease. And minimum of 2 years, but I live in a small town outside of Cincinnati. It was empty before me, so no rent roll, but I paid for it and the land cash.", "replies": [{"id": "g8if5to", "text": "This wrong for someone self-employed, no W-2. 5+ units is commercial and underwrote on NOI unlike 1-4 units.", "replies": [{"id": "g8ifmlh", "text": "Need more % downpayment for commercial.\nInsurance cost rips apart your NOI. \n\nIf you have the cash/assets, you are in better standings to get a 4-plex.\n\nI am self-employed and an independent contractor (realtor). No W-2.", "replies": [{"id": "g8ig4lf", "text": "I\u2019m saying from a lend- ability stand point they would rather lend on 5+ because it\u2019s appraised on NOI and a 4-plex is comps. 1-4 more about personal underwriting and 5+ more about the property.", "replies": [{"id": "g8ih3mu", "text": "I never use banks for myself, but with my clients the smaller the bank the better the lender. We have gotten really creative before. I would never allow someone to purchase something they cannot truly afford, but sometimes banks are less than optimistic. \n\nThe one time I tried to get a loan for a single family I was a new landlord. They gave me the benefit of the doubt and waved the 2-requirement of the same income. Then they said my debt to income was not what they wanted.\n\nThe time I tried getting a loan for the commercial/5-plex, loan fees were super high, insurance was 5x, and downpayment was 20% minimum. Just costs a lot more to own commercial (in my opinion).", "replies": [], "depth": 7}, {"id": "g8ikb8x", "text": "This is part of the reason I would like larger - rent stabilized", "replies": [], "depth": 7}], "depth": 6}], "depth": 5}], "depth": 4}, {"id": "g8jp7mh", "text": "Might want to reread the name of this sub", "replies": [{"id": "g8jpn1q", "text": "I don\u2019t understand your comment. I am in commercial real estate and multi family residential falls into this bracket.", "replies": [{"id": "g8kcwxf", "text": "5+ units is commercial multifamily.\n\n1-4 units is residential.", "replies": [], "depth": 6}], "depth": 5}], "depth": 4}], "depth": 3}], "depth": 2}, {"id": "g8l9a3q", "text": "Did you read any books or get any good primers before you jumped into taking private money? That seems to be in intimidating hurdle that many are afraid to hop into.", "replies": [], "depth": 2}], "depth": 1}, {"id": "g8iw1su", "text": "As long as you make it clear you won't be taking a fee you shouldn't have any problems as far as sheltering deals goes.  It'll take some legwork in the early stages (reaching out to other brokers/owners and letting them know your new role) but at the end of the day, a broker will happily send you anything they have if they get to double-end it. \n\nFinancing piece is tricky.   If you're raising money or syndicating, banks have usually required the net worth of at least one of the sponsors to be the size of the loan.  Alternatively you may want to find someone to cosign for some sort of fee or promote.  Depends on deal size and economics.", "replies": [], "depth": 1}, {"id": "g8jq4sx", "text": "NYC developer here. 1) Can you still use your access to MLS with your license even as a landlord? 2) Partner with someone else who has a balance sheet and you contribute sweat equity and then come up with owner percentages you can live with based on risk, day to day management, level of industry knowledge, etc. Approach lender(s) to discuss guarantee structures and any other typical credit requirements to finesse the remaining terms and conditions with your partner.", "replies": [], "depth": 1}, {"id": "g8jy88c", "text": "If you are 100% on the principal side, brokers will let you take a run at deals.  Pick up the phone and start calling them and use costar, etc.\n\nI am sure you know a mortgage broker at cbre, M&amp;M, etc., a local bank or you can use Fannie /Freddie small balance.  \n\nSyndicating deals will be a little tricky because there are too many 1031 buyers who are ok with a shitty return on their up-leg making it harder for groups like yourself to transact or make a decent return.", "replies": [{"id": "g8rsp2e", "text": "I'm not yet sadly, I'm trying to be in a couple years as a goal", "replies": [], "depth": 2}], "depth": 1}, {"id": "g8kma24", "text": "You should run for president of the united states.", "replies": [{"id": "g8rsrck", "text": "So should you", "replies": [], "depth": 2}], "depth": 1}, {"id": "g8lmrq2", "text": "I'm a multifamily broker who has purchased a few buildings and am now a landlord. You are correct, almost no one will send you deals. I've made it clear that if someone brings me a deal that I won't take a fee, doesn't seem to matter.", "replies": [], "depth": 1}, {"id": "g8lxebe", "text": "I don't bring other agents opportunities unless I've got the listing.", "replies": [], "depth": 1}, {"id": "g8m38ro", "text": "well will you attempt to take a commission on them?  thats your answer in a nutshell.  If no, tell them that and its fine.  If yes then they know they aren't protected and you aren't going to be their first call", "replies": [{"id": "g8rspn8", "text": "Of course not (I would not take commission)", "replies": [], "depth": 2}], "depth": 1}]