Numbers: Prices, Percentages, Points

Despite the volatility of the stock markets and the Texas weather, no matter if it is raining, blowing, or baking, even if I have to walk uphill both coming and going, in a “snownado,” I am here to help you find ways to put your money and your time to good use making more money in big or small, short-term or long term, real estate investment adventures.

I have several loan programs to offer.



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Pay Forward and Give Back

Have you ever been helped by someone for no reason except they were themselves helped by someone along the way? Well that is the concept behind “pay-it-forward” and “give back.” I’ve been the beneficiary of business mentoring myself, so I understand the concept. At no cost to me, I have received coaching from people who have made it themselves, they but feel the need to give back to others and share what they have learned. That is where I learned to “talk to two people every week about what I do and who my ideal clients are.”


In the US market today, where there are plenty of jobs and plenty of homes for sale, employers and real estate investors need to compete. They need to find that distinguishing virtue that sets them apart in the mind of employees, buyers, or sellers. In real estate, it makes sense to take up the philanthropic challenge with the virtue closest to our heart—Shelter the homeless.

Philanthropic work turns out to be is a two-way street that in one direction provides meaningful work, good morale, and purpose to people in business; and in the other direction, provides necessities, like housing to people in need. Profit is good. Awards are pleasant. Followers are GREAT!. ‘Likes” can’t be beat. But, building a home for people who really need one with a portion of the profits earned from selling a home completes the circle of justice, offers purpose to workers and investors alike, and brings joy to communities.

I was pleased to find that the following three charitable home-building models for giving back are active in our Texas communities. Sometimes it is hard to know where to start, so perhaps one of these examples may spark ideas that you would like to pursue.

GiveBack Homes

One company that gives back according to the one-for-one business model (sell one, give one away) is GiveBack Homes. According to their website, Giveback homes is a community of real estate professionals who are committed to creating social change by helping build homes for deserving families around the globe.

At their website,, you can join the team or contribute to a project. Blake Andrews learned the one-for-one building model by working for TOMS. TOMS gives away a pair of shoes to a needy person for each one they sell. When Blake went on a giving trip to Nicaragua for the shoe company, he fell in love with the people and decided to dedicate his life and talents to giving back internally and domestically. He founded Giveback Homes in 2013. Scanning their website you can see that they are currently working on clean water projects and building homes in Nicaragua, Mexico, Atlanta, Austin, Chicago, Dallas, Denver, Houston, Las Vegas, Los Angeles, Oakland, Orange County, Phoenix, Sacramento, Salt Lake City, San Diego, San Francisco, and Sarsota.

New Story Charity Homes

New Story Charity homes is pioneering solutions to end global homelessness. On their website,, they point out that “an estimated 3 million people will be living without access to adequate shelter by 2050, a 200% increase over three decades.” They research breakthroughs in homebuilding and prove them then share the information learned with other builders so home building can become affordable and efficient. Since 2015 they funded 2, 200 homes in 4 countries and 15 communities. The partner with home builders.

New Story partnered with ICON a construction technology firm to develop the first 3D printer designed to print homes. The first version of the printer was Vulcan 1, unveiled in Austin Texas in March of 2018. In 2019, Vulcan 2 will print the world’s first 3D printed community.

First, they ask before they build, asking families for their input before they build to increase the likelihood the communities will thrive. 100 % of donations go to home building. And, they work with local organizations who are experts in the location they are building in. So far, they have worked in Haiti, Mexico, El Salvador, and Bolivia.

Operation Unified Response

100316-N-5961C-020 PORT-AU-PRINCE, Haiti (March 16, 2010) An aerial view of Port-au-Prince, Haiti shows the proximity of homes, many damaged in a major earthquake and subsequent aftershocks.

Concierge Auctions

Concierge Auctions was founded by Laura Brady in Manhattan and is a luxury real estate company that moved to Austin, TX in 2014. According to an article in Barrons magazine by Alanna Schuback, Concierge Auctions partners with GiveBack Homes and funds the construction of a home for people in need for each luxury property it sells and offers its employees opportunities to visit and take part in the construction projects in Nicaragua and El Salvador. I couldn’t find any information about this program on their website, but it is a beautiful website at, so they don’t advertise their charitable work much. However, their founder Laura Brady is a member of GiveBack Homes so that is the connection. You can visit her profile at

According to the Committee Encouraging Corporate Philanthropy, “companies that donate a portion of their revenue to charities do better financially than those who don’t. (Barrons, December 8, 2018). And, some employees actively choose companies to work at because of their charitable activities.

Home sellers and buyers are passionate about more than money too. Like workers, they too are interested in meaningful work, good morale, giving back, and creating good.

Let me know if you have found any deals this month that you know you can turn around and resell with enthusiasm. I hope that I can be of help to you this month.
I can be reached at
Austin, Texas

Photo: U.S. Navy photo by Senior Chief Mass Communication Specialist Spike Call [Public domain] Haiti
Real Estate Brokerages Are Building for Good, Alanna Schuback, Barrons, Penta, December 8, 2019

BE AWARE: Part 1

When making a commercial real estate transaction, whether as buyer, borrower, or lender, you really need to do your research into the property’s current and past uses and potential environmental issues. Remember hard money loans are offered based on the value of the property. So, you want to look carefully at anything that affects the property value now and in the future.

This type of look around and document is called a “due diligence” assessment. As the purchaser or mortgage holder, you want to compile information and investigate the property you are interested in buying to make sure you are aware of any issues with the property that will affect your financial outcome. And, you want to do this before you buy.

Just as you would look for issues with the property’s title, such as judgments and liens, on the financial side; and on behalf of your future renters and buyers, check out the safety of the neighborhood at night; and again on their behalf, inspect the road for gargantuan pot holes that might eat their Prias or VWs; you also want to look at the property itself and at its current and past uses for your own sake to make sure you are not inheriting any costly environmental issues that you are not prepared for.

Cleanup Will Cost You

Environmental contamination, such as asbestos, PCB’s, radon, leaking underground storage tanks, mold, mildew, and lead-based paints on a property can cause the cost of “fixing” the property to explode so you want to be aware of these situations and prepare for them or walk away.

The official name for the investigation into environmental hazards and liabilities on a site is called a phase I environmental assessment. It determines in a methodical way if there is any environmental contamination or hazards in a building’s region or within the building itself. There are many professional firms out there that do this kind of work and one may have already been done on the property you are thinking about.

Get the History

The environmental site assessment typically addresses the history and current conditions of both the underlying land as well as physical improvements to the property. This assessment would scrutinize the land for soil contamination, the groundwater and surface water for contamination and quality.

It would look at the structure or structures on the property you are buying. Are there abandoned drums of unknown liquids or materials, an unlicensed dumping ground in the woods in back of the house, contaminated water wells nearby, or chemical residues, asbestos, mold, mildew, or other hazardous substances in the basement?


Abestos (tremolite) silky fibers, photo taken at the Natural History Museum in London by Aram Dulyan, public domain, Wikimedia commons.

Neighboring Properties

The phase I environmental assessment would also evaluate if there are contamination risks on neighboring properties that might affect the value of the property you want to buy. Before you invest in the formal environmental assessment, you might want to do a little sleuthing yourself to see if you want to invest even that far  You can start by performing some visual inspections and record searches yourself.

Walk around the neighborhood and take notes on what is nearby, within a half mile or a mile. Are there hazards or attractions in the vicinity?

Review Federal, State, Local, and Tribal records of the property using its GPS coordinates and review the records for properties up to a mile away.

Interview people who are knowledgeable about the property, for example, past owners, current owners, managers, tenants, neighbors.

Fires, Floods, Mud, and Spills

Examine municipal or county planning files to check for prior usage and permits granted and conduct file searches with public agencies, such as the fire department, state water board, county health department. Ask yourself, has a previous building on the site burned down? Why?

Examine historical and aerial photos for previous and current structures in the vicinity, like an old rail yard, military base, or gas station. It is a good idea and sometimes even fun to look at photos back to a time when there was only bare ground at the site.


USGS Topo of Lake Conroe, Tx and vicinity, public domain, Enter a caption


Debris flow in Ladakl, India photo by Dan Hobley, Wikimedia commons.

Examine USGS maps and look at the drainage patterns and topography. We have seen enough in the news lately to make us aware of the dangers of floods, mudslides, fires, and hurricanes.

Where one of these has occurred, it is likely that another will follow sometime down the road. Ask yourself, has this property been flooded before or does it lie in a floodplain or an arroyo?


If you are considering lending money on a property, you might want to take into consideration the requirements of the US Small Business Administration’s 504 Fixed Asset Financing Program. It requires specific and often higher due diligence requirements than regular real estate transactions. These assessments are required for certain NAICS codes that associated with the prior business use of the property. There are 58 specific NAICS codes that require Phase I Investigations. These include, but are not limited to: funeral homes, dry cleaners, and gas stations. According to Wikipedia, “The SBA also requires a Phase II Environmental Site Assessment to be performed on any gas station that has been in operation for more than 5 years. The additional cost to perform this assessment cannot be included in the amount requested in the loan and adds significant costs to the borrower.”

The US Department of Housing and Urban Development also requires a Phase I ESA for any condominium under construction that wishes to offer an FHA insured loan to potential buyers.

Remediate or Remodel?

All of this detail is indeed not meant to scare you away from buying real estate to remodel and resell or to remodel and rent. It is only meant to make you aware. It is trendy and even admirable to consider buying old junked up industrial property down by the river or in the mining district and turning it into polished urban housing or shopping pavilions.  If you have ambitions in this area, be sure to look around carefully, do your research, know your costs, and have money ready to remediate the site for you are probably looking at more than a quick remodel.

Disclaimer: I am not providing environmental advice or investment advice.


Austin, Texas

Doing the Math: Purchase, Rehab, Refinance, Cash Out

The markets have been extremely volatile lately and they say the anxiety meter has shot up to screaming level.  However, according to Caleb Silver, Editor-in-Chief, Investopedia is not predicting a major market decline.  And, whether the market is up or down, I am here to help you find ways to put your money into other types of ventures, like fix-n-flip real estate projects big or small. It works like this:

  • You Purchase
  • You Rehab
  • You Refinance
  • You Cash Out

Silver also says in his daily e-mail that “Seasoned investors have learned to moderate their expectations and build their portfolios to endure all kinds of markets.  It takes discipline and a lot of learning to do that well, and even the best of them still get their faces ripped off now and again (a technical expression for suffering massive losses). Still, having unreasonable expectations is the first step to setting yourself up for disappointment.”

Ah yes, setting yourself up for disappointment: I remember Christmas mornings when I was a child as a time of too much expectation.  By the time Christmas morning came around, my expectations were sky high and no matter what great present my parents or Santa Claus brought me, I was going to be disappointed because nothing could live up to the fantasy in my head.  So, the day was never as much fun as it should have been.

I’d say that Silver (good name for an investment geek) is trying to warn us . He says that Vanguard (a massive money manager) recently surveyed its customers and found that their expectations were way off from its own market predictions. Vanguard found that the average retail investor expects stock to return more than 10% a year on average and people with their money in pension funds expect 7.5% average annual returns.  Unfortunately, Vanguard expects a 4.6% return on stocks.

So put in your time studying so that you can put your money to good use making more money for you.  Think about your options and don’t freak out. As Silver says, “When the Anxiety Index picks up, volatility tends to follow.”  But as Friday’s Investopedia headline read  “REMAIN RATIONAL.” (see

Here is a rational option to study:

Purchase, Rehab, Refinance, and Cash Out of a Multi-Family Building

Loan Requirements

  • Min 5 units
  • Loan Amounts – $250,000 – $5,000,000
  • Interest Only – 2yr Term
  • 1st Lien Position Only
  • No Prepayment Penalties
  • Up to 80% for Purchase and Rehab
  • Up to 70% for Refinance and Rehab
  • 55% for Cash Out


  • Min FICO 670
  • Full Recourse
  • DSCR / Occupancy – No requirements while being rehabbed
  • Min Liquidity of 9mo of debt service + 20% of rehab budget

Appraisal Requirements

All loans require a full appraisal with internal property pictures and dated within 120 days of loan origination.

Lending Areas

All major metro areas and small market areas nationwide.  Non-lending areas include rural and high-risk areas.








Non-Recourse Loans for Self-Directed IRA

This loan is designed for an IRA that holds a property as an asset.  Generally, these properties are rental units and therefore, are long term holds.  The only type of loan an IRA may have is a non-recourse loan.  This loan is one in which the IRA account holder is not personally liable for repayment of the loan.  In the event of a default/foreclosure the lender can only look to the property as the sole source of repayment.

The following properties are eligible for a non-recourse loan:

  • SFR
  • Warrantable Condo’s
  • PUD
  • Duplexes
  • TriPlexes / Quadplexes
  • Multifamily (5 or more units)1-4 Family (min $50,000)


Altairisfar [Public domain], from Wikimedia Commons

Current Loan Options

  • 3,5 or 10 yr ARM
  • 10-20 yr Fixed
  • 70% Max LTV
  • Max Term 20 yrs
  • DSCR Min 1.2-1.25
  • Multifamily (min $300,000)
  • 5/1 ARM
  • 15-20 yr Fixed
  • 65% Max LTV
  • Max Term 20 yrs
  • DSCR Min 1.3


Austin, Texas