Understanding Debt with James Eng

Multifamily Investing Made Simple

Our guest for today has started his career as a loan underwriter at GE Capital Real Estate prior to joining Old Capital in 2015, where he is currently the national director. He's often called the professor of multifamily finance, and he has produced hundreds of hours of educational multifamily content on YouTube. And in addition to financing multifamily, he has invested in close to ten thousand units as a limited partner and nearly 30 properties in Texas.

Let’s dive right in and learn from James Eng and how we can understand debt.

[00:01 – 14:08] Opening Segment

• We introduce our guest, James Eng
• James talks about his background

[12:39 – 23:03] Using The First Deal To Your Advantage

• James talks about his background
• How to make a qualified decision

[23:04 – 28:34] Higher IRR Does Not Guarantee A Better Quality Return

• James shares his experiences as a multifamily investor
• Discovering that returns may go lower the more experience an operator has

[28:35 – 40:46] The Murky Waters Of Actual Debt

• The 5 columns of debt on a scale
• Loans with extra Covid Insurance

[40:47 – 47:51] Closing Segment

• Final thoughts
• James's book recommendations:

Purple Cow

The Most Important Thing

Who Not How

Tweetable Quotes:

“I think if you buy any piece of real estate or invest in any piece of real estate, you know, as an LP, your biggest risk is protecting your principal.” – James Eng

“I'll see a 50-page deck and they'll be half a slide on the financing. And so that's why I wanted to bring it to people's attention.” –James Eng

"I think a lot of times people try to try to look at a deal and sort of figure out, compare the deals, the deals. But there's so much in between." - James Eng

"I'm going one hundred percent on the operator, which I think is important. But sometimes experience operators actually take too much of the equity." - James Eng

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