Has any sherdogger ever taken out loan for other than auto or home?

[RJ43]

Tell me MOAR. Do you own triple net properties or multi-family?

EDIT: Just looked at your following responses. You're more into residential so my recent experiences don't really qualify.



It's commercial property. We don't do triple net leases, but we do have the tenant pay for utilities and insurance. Our properties cash flow very strongly so we easily clear enough to cover property tax and a modest maintenance reserve each month.

SBA loans mandate that it must be at least 50% occupied by the entity that is requesting the loan. The advantage of this is that you can get in with only 10% down. This becomes more important in competitive markets like SF. The remaining 90% is split 50-40 between a private bank and a CDC which is basically a non-profit partner of the state government that authorizes the loan.

The 40% CDC component is a fixed rate for 20 years. All CDC's use the same rate at any given time. The private bank usually has a few options in terms of interest rate. Both rates are a bit higher than the lower residential mortgages you might see. Between 4-5.5% depending on several factors.

I spent about 2.5 years molding the financial health of the underlying company to ensure we would qualify when the time was right. At the end of the day their decision hinged on 3 years prior tax returns and adequate debt coverage operating capacity of the company.

So, for us, we decided to buy two adjacent properties, rehab them, and lease out the 50% that would not be occupied by us. This not only creates stronger equity and cash flow, but it also served to reduce the underlying company's monthly rent expense.

 

[RJ43]

We have also looked into "hard money" guys and deemed it's not the right fit for us. We had rather complicated deal presented to us and it seemed like hard money was the only avenue but with the rates they charge it leaves practically zero margin for error and eliminates a lot of the upside unless you get lucky.

 

[Matt4786]

Endless student loan debt. Gonna be around half a mil by the time med school is over. I tend to choose my political stances a la carte. Sometimes I'm on the right, but student loan reform is one where I'm so far left that I've circumnavigated the globe.

 

[Oblivian]

I want to know how you go about this.

Are you talking about residential properties used for rentals or commercial properties where you'd be renting to a business?

 

[bdthrill]

Student loan. Have since paid them off. Still owe on my house though

 

[MadSquabbles500]

Are you talking about residential properties used for rentals or commercial properties where you'd be renting to a business?

Both, lets talk

 

[MadSquabbles500]

EDIT: Just looked at your following responses. You're more into residential so my recent experiences don't really qualify.



It's commercial property. We don't do triple net leases, but we do have the tenant pay for utilities and insurance. Our properties cash flow very strongly so we easily clear enough to cover property tax and a modest maintenance reserve each month.

SBA loans mandate that it must be at least 50% occupied by the entity that is requesting the loan. The advantage of this is that you can get in with only 10% down. This becomes more important in competitive markets like SF. The remaining 90% is split 50-40 between a private bank and a CDC which is basically a non-profit partner of the state government that authorizes the loan.

The 40% CDC component is a fixed rate for 20 years. All CDC's use the same rate at any given time. The private bank usually has a few options in terms of interest rate. Both rates are a bit higher than the lower residential mortgages you might see. Between 4-5.5% depending on several factors.

I spent about 2.5 years molding the financial health of the underlying company to ensure we would qualify when the time was right. At the end of the day their decision hinged on 3 years prior tax returns and adequate debt coverage operating capacity of the company.

So, for us, we decided to buy two adjacent properties, rehab them, and lease out the 50% that would not be occupied by us. This not only creates stronger equity and cash flow, but it also served to reduce the underlying company's monthly rent expense.

So you also manage a business located on the premises as well?

Can this business be the property management office for the estate, in order to qualify for this SBA loan or CDC loan?

I am not more into residential actually. I work in that department right now. I want to move away from that. I know what it is like to deal with tenants, and courts, and maintenance, and accounting for the multi-family segment. I think commercial will be a breeze compared to that.

 

[MadSquabbles500]

Took one out years ago for a hot tub and privacy fence. Still have the fence but the hot tub started fucking up 3 or 4 years ago so I cut it up with a Sawzall and threw it in the dumpster at work. Hot tub has to be one of the easiest ways to get women over. Slots gonna sloot.

Banks loan money for things like hot tubs?

 

[MadSquabbles500]

Back in 2007 i took a small loan of 2000 £ before entering the Comandos course ... i needed to buy a bunch of uniforms, several boots and gear ... i did it cause i was just finishing basic training and the soldier salary is low so i was nearly broke , plus during the 1 month indoc + 12 weeks course the rule is everyone takes a 1/3 cut of your salary ... by taking the loan i could make that initial investment and get to keep a small "working capital" ... the rate was about 20% tho , but i had no choice cause i had no other option ... if memory serves me correctly the bank required the salary receipts of the 3 previous months and because i was just finishing the 3 months basic training i didnt have them ... i was only able to get the loan cause i had a connection in the bank, a long time friend who worked there.
It worked out well but im personaly against taking loans, or working with banks for that matter.

is this loan from a pawn shop?

 

[MadSquabbles500]

We have also looked into "hard money" guys and deemed it's not the right fit for us. We had rather complicated deal presented to us and it seemed like hard money was the only avenue but with the rates they charge it leaves practically zero margin for error and eliminates a lot of the upside unless you get lucky.

Why do people even bother offering this type of deal? Who will take it?

 

[Green Poncho]

Endless student loan debt. Gonna be around half a mil by the time med school is over. I tend to choose my political stances a la carte. Sometimes I'm on the right, but student loan reform is one where I'm so far left that I've circumnavigated the globe.

$500k in student loans?! What the fuck.

 

[Matt4786]

$500k in student loans?! What the fuck.

Med school is expensive. So is an Ivy League undergrad.

 

[greygoose]

I remember a guy that reported to me at work had to take out a loan to get the new iPhone a couple of years ago. His credit was so bad, that he was forced to pay full price (like 600/800 bucks or something), and he didn't have the scharole. Poor bastard

 

[DrBdan]

Banks loan money for things like hot tubs?

Totally. You could tell the bank you want money for "home improvements" and then spend it all on cocaine and hookers if you wanted. In the end the bank mostly just cares that they get the money back plus interest. The loan I got was technically for "debt consolidation" or something like that but my wife's debt was probably at least 2k from buying Xmas presents, a bunch from just going out with friends, buying clothes etc. Totally frivolous stuff that you should pay cash for but many people don't.

 

[SwamiLeoni]

Med school is expensive. So is an Ivy League undergrad.

Agreed. Although not an Ivy League school, my credit hour at Embry-Riddle as over $1100. I'm swimming in debt and tears and will circle the globe in protest with you. Private Loans are the absolute worst though. I honestly doubt I will outlive my loans. I got suckered into false hopes and dreams.

 

[Oblivian]

Banks loan money for things like hot tubs?

For residential, it shouldn't be a problem. For most banks, if you have 20% down + credit worthiness + income to pay back, they'll just take the house as collateral for your loan. If you are a riskier borrower, they may want additional collateral. Most of the time, that would be your house, but recently we did one that took a car title.

For commercial, it depends on the bank. You may need to provide a business plan with it, your potential renters, marketing for it, etc. It's still similar though. If the property appraises and you have money down, the risk is minimized.

Keep in mind you generally pay a higher interest rate on rentals or commercial properties. Depending on your location, taxes are generally higher and insurance is more.

 

[BisexualMMA]

Endless student loan debt. Gonna be around half a mil by the time med school is over. I tend to choose my political stances a la carte. Sometimes I'm on the right, but student loan reform is one where I'm so far left that I've circumnavigated the globe.

I think @Scyther might take issue with that.

 

[Oblivian]

Why do people even bother offering this type of deal? Who will take it?

High end flippers. I've seen it on a commercial deal that had the potential to expire if the buyer's financing didn't come through. He took a hard money loan that he paid off once all of the requirements were met for the bank financing to go through. It was expensive, but the penalties if he didn't close by a certain date were heavy as well.

 

[MadSquabbles500]

Totally. You could tell the bank you want money for "home improvements" and then spend it all on cocaine and hookers if you wanted. In the end the bank mostly just cares that they get the money back plus interest. The loan I got was technically for "debt consolidation" or something like that but my wife's debt was probably at least 2k from buying Xmas presents, a bunch from just going out with friends, buying clothes etc. Totally frivolous stuff that you should pay cash for but many people don't.

Do you just walk into a bank, and fill out a form, and just receive the loan? Or do you have to do some smoozing, and puckering to someone before they even consider you?

 

[weich]

Endless student loan debt. Gonna be around half a mil by the time med school is over. I tend to choose my political stances a la carte. Sometimes I'm on the right, but student loan reform is one where I'm so far left that I've circumnavigated the globe.

At least you will make that back in the long run. What type of doctor are you going to be?