Refinancing a mortgage on a 12-unit bldg in NYC - Posted by Jason Rodriguez

Posted by LUUP on December 29, 2008 at 12:03:00:

This is true!

Refinancing a mortgage on a 12-unit bldg in NYC - Posted by Jason Rodriguez

Posted by Jason Rodriguez on December 15, 2008 at 12:42:10:

My two brothers and myself inherited our parent’s 5-story, 12-unit apartment building on the vibrant west side of Manhattan, NYC over four years ago. We also have a commercial tenant on the ground floor (a successful restaurant). Almost three years ago we took out a 7-year $1 million mortgage on this property (and our building pays around $9,500 per month for this mortgage) and I was happily able to retire on the $300K I pocketed. We have recently discussed what more we can now do to get another nice chunk of $$. This past year we were able to take an annual total of approximately $24K each from the building’s profits (our rent-roll totals around $25K per month). All three of us agree that attempting to sell the building right now in this terrible economy is not an option. MY suggestion was that we refinance our mortgage as interest rates are low now. However, one of my brothers feels uncomfortable doing that because (a) we would have to pay around $80K outright just to take care of the first mortgage, in addition to paying closing costs, fees, etc., and (b), although he feels that the building would be able to pay the higher monthly mortgage payment, he feels uncomfortable about leveraging our building for over $2 million, especially when right now all property values are low. He would prefer for us to just continue taking our monthly $$$ from the building’s profits. My answer to that is that this current terrible economy is hopefully a temporary anomaly and that property values will rebound in a year or two. The three of us are in our 60’s and I feel that tomorrow is promised to no one, and we should enjoy as much money as we can while we are still healthy enough to. I am the only brother who REALLY needs a financial shot in the arm now; they don’t. I expressed to my brother that his discomfort level shouldn’t deny us in getting another nice chunk of money each. Is there any method of perhaps having a bank give us a “mini-loan” allowing just me to get around $100K? Does anyone have any idea how we can safely get more $$$ from this valuable property, instead of just taking “nickels and dimes” per month from the building’s profit? Thank you.

Well, SOMEbody’s Gotta Say It - Posted by PeteH(NYS)

Posted by PeteH(NYS) on December 18, 2008 at 23:25:48:

But if you RETIRED on $300K three years ago, and all of a sudden you need another $100K “shot in the arm” – $2K/mo isn’t enough for you – then you’re not conserving the resources available to you. You need to figure out how to live a little cheaper.

Talk to your brothers in 15 months – everybody will have a better idea what’s happening with the larger economy by then – and make the case that a perfectly conservative debt structure is 70% LTV. However much that lets you take out, your share is what you’ve got to live on for a few more years. Oh, and your social security.

Refinancing a mortgage on a 12-unit bldg in NYC - Posted by Joe A

Posted by Joe A on December 18, 2008 at 19:28:24:

You, yourself, cannot obtain financing using the building as collateral. ALL individuals on title must be on the note/mortgage.

I don’t understand why you think you have to pay $80k out of pocket to refinance the current loan? Oth ern than appraisal and/or 3rd party fees, all closing costs are rolled in to the new loan.

Brilliant… - Posted by Seeist

Posted by Seeist on December 19, 2008 at 11:12:57:

Jeez, $300,000 in three years? How long do you think $100,000 is going to last you? You should’ve taken that $300,000 and put it back into real estate. You obviously are kind of an idiot with your money. People tend to do stupid things with money when it’s just handed to them. Aside from anything else, your brothers are reasonable for not wanting to be overleveraged. You simply see this property as a money sponge that when squeezed will continue to provide you enough money for booze or whatever it is you waste your money on. Eventually, the sponge will dry out and you’ll be stuck with a property you can’t sell because you’re upside down. The future of cre is uncertain, but rates will stay low for a while and if anything, lending will increase in the future, so I don’t think you have a good argument at all. If we are approaching a time of inflation at the end of 2009 it could be good for rents. I would stay where you’re at and reassess in one year. Most buyers and sellers are afraid to do anything right now because of uncertainity.

rude and uncivilized - Posted by luap

Posted by luap on December 21, 2008 at 12:41:25:

There is NO reason to call this person names and suggest he is buying booze with his money. If you can’t be civilized, don’t contribute.

Re: rude and uncivilized - Posted by Seeist

Posted by Seeist on December 22, 2008 at 07:50:11:

The guy wanted advice, maybe I gave him the advice he needed…quit your cryin’ luap.

Re: rude and uncivilized - Posted by luap

Posted by luap on December 23, 2008 at 12:31:07:

Advice…suggesting he is spending his money on drinking when you have no evidence is not advice, at best its you being an ignorant ass, at worst its slander. So why don’t you STFU.

LUAP THE FOOL! - Posted by Seeist

Posted by Seeist on December 29, 2008 at 04:06:29:

I have some advice for you - you’re pathetic!

LUAP THE SEX ADDICT! - Posted by Jose

Posted by Jose on December 29, 2008 at 12:02:07:

This is true!