Ep. 127 Scott Maurer & Dave Shaw: There Are Many Ways to Invest in Real Estate With an IRA!

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You probably know that an IRA is a great way to save for the future. You may even be making contributions to one set up through your work. But did you also know that an IRA can serve as a great investment vehicle? Investors use IRAs to hold a variety of assets, but many don’t know that you can invest in real estate with an IRA too. A self-directed IRA provides a lot of flexibility for real estate investing.

This episode is a special one for Invest Florida. We’ll be covering the many ways to invest in real estate with an IRA in front of our first-ever LIVE audience! Scott Maurer, of Advanta IRA, and investor, Dave Shaw join us for a special panel discussion on investing in real estate using a self-directed IRA.

self-directed IRA real estate investingScott Maurer joined Advanta out of college. He has since become the Director of Business Development and regularly educates investors on the many advantages to investing through self-directed IRAs.

 

 

invest in real estate with an IRADave Shaw is a real estate appraiser-turned investor who uses his self-direct IRA as a lending vehicle.

What You Need to Know to Invest in Real Estate With an IRA

  • You can transfer funds IRA-to-IRA tax-free
  • Funds can be transferred as-needed
  • In Florida, IRAs are only protected against personal creditors, not real estate liabilities

Setting Up A Self-Directed IRA

  • Advanta Costs:
    • $50 account-opening fee
    • One-time $95 investment fee (per investment)
    • $295 annual account management fee (includes payments and expenses)

Lending Through a Self-Directed IRA

  • You cannot lend to yourself or immediate family through your IRA
  • Flexible lending terms – you can write your own agreements
  • Returns:
    • 12-15% on 6 month fix-and-flip
    • 10% on 3 year lends

Contacts

  • To learn more about how you can invest in real estate with an IRA, call Advanta at (800) 425-0653 or visit their website. You can also check out educational videos and webinars from Scott on Advanta’s YouTube page.
  • Dave is always looking for single and multifamily deals (4 units and less). You can reach him by email at daveshaw98@gmail.com

Ep. 122 Livingston Hessam: What You Need to Know About the State of Mortgage Banking and Real Estate Lending

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mortgage banking and real estate lendingIt’s a new year and change is in the air. With financial regulation changes sure to come and the recently announced Federal interest rate increases, it’s no wonder mortgage banking and real estate lending is hot on investors’ minds.

This episode, we have Livingston Hessam, who just returned from this year’s Mortgage Bankers Association Commercial Real Estate Finance and Multifamily Housing Convention & Expo.

Listeners will remember Livingston from episode 70, in which he gave us a recap on multifamily mortgage banking and real estate lending from the 2016 conference. Livingston is Vice President of Walker & Dunlop‘s Tampa office. Livingston brings over 12 years of experience in real estate lending and finance solutions to Walker & Dunlop, which just celebrated it’s 80th anniversary.

Livingston offers up a recap of the 2017 CREF/Multifamily MBA Conference and discusses key themes from the past year and the current state of mortgage banking and real estate lending.

What’s In Store for Mortgage Banking and Lending

Agency Annual Caps

  • Fannie Mae & Freddie Mac each allocated $36.5 billion for 2017 (same as 2016)
  • Certain loans and portions of loans are excluded from the cap (i.e. affordable and green/energy efficient)
  • Fannie Mae & Freddie Mac multifamily production totaled over $110 billion in 2016.
  • Fannie up 30%, Freddie up 20% from 2015
  • Expected to capture 40% of total multifamily volume for 2017 ($50-55 billion each)

Commercial Mortgage-Backed Securities (CMBS Loans)

  • Risk-retention regulations put in place in 2016, narrowing amount of CMBS lenders
  • Post-election stability, but more selective lending market
  • CMBS lenders ramping up bridge-lending

10-year Spreads

  • Life-insurance (50% leverage and under): 125-135 range
  • CMBS (75% leverage): 250-280 range
  • Agency (80% leverage): Low 200s range
  • Federal interest rate sees .25% increase
  • Expected to increase to 2.75-3% by end of year

Hot Topics

  • Trump Administration
    • Tax reforms
    • Dodd-Frank roll-backs
  • Retail lending
    • Publix most active retail buyer in FL
    • Grocery chains are buying out plazas after lease terms or taking right of first refusal on new lease terms
    • Reduced supply of grocery-anchored retail
    • Strong retail appetite for real estate lenders

Investor Resources

  • In addition to his V.P. role at Walker & Dunlop, Livingston is President of the Society of Real Estate Professionals (SOREP). Formerly the Tampa chapter of University of Florida’s Bergstrom Council, SOREP hosts networking events and seminars to professionals and gives back to Florida universities. SOREP focuses on all aspects of the real estate industry and is open to all. Click here for more info.
  • Walker & Dunlop offers comprehensive real estate financial solutions for all income-producing properties. For more info, visit Walker & Dunlop website.
  • To contact Livingston directly, click here.

 

 

Ep. 70 Livingston Hessam: You Will Want to Hear What Is Happening With Mortgages!

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Livingston-Hessam_jpgThe coming year is looking to be an eventful period for mortgages and financial lending in real estate. Debt markets are poised to undergo significant changes over the following years amidst regulatory changes and geo-political headwinds. Investors, both seasoned and novice, should be aware of the changes and the effects they could have on current and future mortgages.

Livingston Hessam, Vice President of financial solutions firm Walker & Dunlop and financing expert, discusses these changes in the debt markets and what investors need to know about their impacts on mortgages and other debt-equity options.

  • 2016 Mortgage Bankers Association Conference
    • Annual conference gauges financing market for coming year
    • Mixed outlook for 2016
    • Multi-family holds strongest appetite for lenders
  • Debt Categories
    1. Agency Debt – Fannie Mae / Freddie Mac
      1. Conventional rates, senior housing, student housing, manufactured housing
      2. High-leverage, non-recourse, cap limits
      3. Reached 2015 cap before end of year
      4. Introducing smaller deal offerings ($1-5 million) – lower upfront closing costs, for typically novice borrowers, not included in annual cap limit, do not require same level of eligibility requirements
      5. Only can acquired through authorized servicers/lenders
    2. CMBS Markets (Commercial Mortgage-Backed Securities) – Loans sold by banks into secondary markets
      1. Amid current CMBS 10 year maturity loans wave
      2. Several regulations coming into effect causing uncertainty: Risk Retention (Dec. 2016) – Req. CMBS issuers to hold 5% of loan to securitize deal
      3. Investors and lenders advised to close deals in first half of year
    3. Life-Insurance Company Loans
      1. Typical deal – sub-70% leverage, non-recourse, strong exp. sponsor, well stabilized market
      2. Positive lending outlook for 2016
    4. Conventional Lending (Banks)
      1. Regulatory changes: Dodd-Frank Act
    5. Alt. Lending
      1. Walker & Dunlop offers bridge-lending packages
      2. Good for investors with assets not ready for perm. agency lending
      3. Up to 80% of cost for pre-stabilized deal or value-add deal, up to 36 months, help re-sell or re-finance
      4. For multi-family, student housing, manufactured housing, independent & assisted living, and skilled nursing

Livingston kindly provided us with a detailed, corporate overview package for Walker & Dunlop, further describing the financial solutions they offer as well as contact information.

Corporate Overview 2.22.16

 

 

Ep. 49 Kevin Jursinski, Esq: Update on Dodd Frank Seller Financing Laws and Real Estate Lending on Single Family Properties

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Kevin-F.-Jursinski-B.C.SSince the Dodd-Frank Act was signed into law in 2010, the immense and labyrinthine series of stringent financial regulations has been a foreboding presence in real estate lending, especially in Florida. Instituted in response to the Great Recession, Dodd-Frank has posed a formidable threat to investors. With over 2000 pages of new rules and financial regulations, investors are unsure exactly what is exempt from Dodd-Frank stipulations.

Kevin Jursinski, B.C.S is FL Bar Board certified in real estate and construction law as well as business litigation. With over over 30 years of practice in Florida real estate law as well as personal experience in the Florida investment market, Kevin has the knowledge and insight to summarize the bill and define its role in real estate lending. Kevin also discusses how Dodd-Frank related litigation might be approached in court.

  • Dodd-Frank Act (2010)
    • Dense and punitive set of rules outlining financial regulation
  • Seller-Financing & 3rd Party-Financing Affected
  • Gray Areas Explained
    • Dodd-Frank does not apply to non-consumers (Investors) of residential property
    • Commercial properties do not apply
    • Dodd-Frank only affects primary residences (vacation homes exempt)
    • Purchase-money financing only affected by Dodd-Frank in owner-occupied sales
    • Residential home-builders are precluded under Dodd-Frank from becoming contractors of seller finanacing
    • Dodd-Frank does not apply retroactively – previous owner-occupied financing not affected
    • Dodd-Frank applies to origination of loan intent
  • Recent Dodd-Frank Changes
    • Owner-occupied residence lending/financing
      • 1-Sale exceptions – Sell one property per year w/ Dodd-Frank guidelines
      • 3-Sale exceptions – Sell up to three properties per year w/ Dodd-Frank guidelines
  • Government Oversight

To keep updated on changes to Dodd-Frank and its impact on real estate lending visit Kevin’s website, www.kfjlaw.com

Kevin’s article on  Update-as-to-the-Dodd-Frank-Act-Seller-Financing-Restrictions

Dodd Frank Seller Financing Rule Update