10.23.2019 - By Jake & Gino
Dylan Marma and Mike Taravella interview Rand Capitalâs Nick Chapman to discuss the financing cash flow levers to maximize cash flow with agency debt. Interest Only Allows for more velocity on your capital to hit IRR targets and preferred returns You leverage the interest-only period to reinvest into the property in the form of capital expenditures (Capex) Case Study Loan: $3M Loan Interest Rate: 4.25% Cash Flow Savings of $50,000  Longer Amortization Period Longer amortizations allow for more favorable Debt Coverage Ratios Case Study Loan: $3M Loan Interest Rate: 4.25% Amortization: 30 years Cash Flow Savings of $18,000 Higher Leverage Share the upside with investors by having your lender take on the risk Investors can still have capital to invest in other deals âLet your lender be your biggest partnerâ - Nick Chapman\ Expert Tip of the Day: When refinancing out of bridge debt, if you are doing a rate and term refinance you can go up to 80%, if you are doing a cash out refinance you can go up to 75%.  Contact Information: Nick Chapmanâs Email Rand Capital Website  Invest with Rand Partners Follow Us on Linkedin @Randpartners Follow Us on Instagram @Randpartners Follow Us on Facebook @Randpartners