Does Your Lender Do This? Can Your Lender Do This?

Question9/12/19 – I hope you are doing well and Happy Thursday!  It is a great time to buy a house as the weather is beautiful and you have no excuses.

Since many of you are not my regular clients then I am going to hold some stuff back on the and let your lender try to figure out where you can find these buyers.  Or, if you want to come over from the dark side, I can help!

Most investors invest in their peak earning years or in years that they are earning a regular income.  They are looking for long term gains, or just somewhere to stash their money.  Most investors are looking at their long term return on investment.  Let’s take a property at say $600,000.00 and a buyer puts down 25% – They have a payment of $2180.92 + $625.00 for taxes and $100.00 for insurance = $2905.92 / This property rents at $3200.00  –  so $294 a month is profit + they pay off 7804 the first year for a total of $11,332.00 say expenses are $2500 including property management so the net is $8832 on $160,000.00 investment (150K + 10K for closing costs…) So they made 5.52% on the 160K investment.

5 years from now the rents will be $3625.60 at a 2.5% annual increase.  You would pay off  $9752.00 in principal and have about $6000 in net profit from rent.  9.84% ROI – Not including appreciation

In 10 years you would be getting $4107 in rent – $11,981 paid in Principal + $10,000.00 in net profit from rents = $22981 / 160K =  14.36% ROI  – Not including appreciation

In 20 years you would be receiving $5272 in rent – $18,086 paid in principal + $22,000 in net from the rents = $40,086 / $160,000.00 = 25% ROI – Not Including appreciation

In 30 years they would have a property that is paid for with rents of $6768.00.

If the property goes up by 3% annually and we have averaged 5.7% in most parts of Southern California over the past 50 years then you would be looking at a property that is worth $697,000.00 in 5 years, $809,000.00 in 10 years, $1,092,453 in 20 years and $1474,000.00 in 30 years.

If you add up the rents you would have collected $1,700,000.00 in rent.  You would have paid $335,000.00 In interest, $303,000.00 in property taxes, $50,000.00 In insurance and $150,000.00 in maintenance = $838,000.00

So adding it all up, we have $1474,000.00 +1,700,000.00 – $838,000 – 160,000.00 our original investment  = $2,176,000.00 in profit over 30 years / $72,533 per year on a $160,000.00 Investment  =   45.33% annual return on investment

So finding these people is easy and I will do these types of breakdowns for them when I speak with them.

Take an example of Silicon Beach area!  They houses range from $1,200,000.00 – $15,000,000.00.  How many young people making $150,000.00 – $200,000.00 can afford to live there.  Well, we have a plan for them!  they can buy 1-2-3 properties today and in 5 years they will have $$$ to do an exchange and buy something they can live in.

If you want to work with me and my team and you feel like you can be loyal then I will help you find these buyers.  We will be happy to put a prospectus like the one above together for each and every property they are interested in.  I believe in investment properties and I believe that everyone should own 1,2 or 10 properties or more!  It will bring financial stability and wealth to you and your clients that buy into this!  There is no more land in Sherman Oaks, Pasadena, or Beverly Hills.  There is only so much coastline and people are still moving to this state even though the growth is slowing.

Interest rates are tweaking a little higher every day.  that sounds a little druggie, LOL!   Below are rates based on a 740 Credit score and rates are subject to change without notice:

  • 30-year fixed conventional 1st Mortgage with 25% down – 3.625% (3.671 APR). Loan amounts up to $484,350.00 = $2208.88
  • 15-year fixed conventional 1st Mortgage with 25% – 3.125% (3.208 APR). Loan amounts up to $484,350.00 = $3374.03
  • 5/1 ARM 1st Mortgage –  25% down – Fixed for 5 years and then becomes variable – 3.500% – (3.594 APR) Loan amounts up to $3,000,000.00 = $13,471.34
  • 7/1 ARM 1st Mortgage – 25% Fixed for 7 years and then becomes variable – 3.625% – (3.714 APR) Loan amounts up to $3,000,000.00 = $13,681.54
  • 10/1 ARM 1st Mortgage – 25% Fixed for 10 years and then becomes variable – 3.750% – (3.844 APR) Loan amounts up to $3,000.,000.00 = $13,893.47
  • 30-year fixed 1st Mortgage FHA loan 3.50% down – 3.250% (4.663 APR). Loan amounts up to $484,350.00 = $2144.81 + $349.08 PMI = $2493.89
  • 30-year fixed 1st Mortgage VA loan 0% – 3.250% (3.296 APR). Loan amounts up to $484,350.00 = $2107.92
  • 30 Year Fixed rate 1st Mortgage Jumbo Loan 25% down – 4.250% (4.344 APR).  loan amounts up to $3,000,000.00 =14,758.20

I will be in and out of the office all weekend so the best way to reach me during the week is in my office at 661-260-2970xt. 2222.     My Cell number is 661-714-6258 and that is a great way to find me anywhere in the world which is usually in Los Angeles County.  Please call, text, email, or messenger me.  I am here to serve you and your clients with all of their financing needs.  Have a great day and a better weekend and I hope to hear from you soon.