Looking for advice about my next move

[Benjamin Gonzales]

My current portfolio-

Home #1 Cache, OK, Rented out for the past 2.5 years (VA loan)

Home # 2 Lacey, WA, Primary home for the past 2 years on the 23rd of December (VA loan)

Zero cash flow

Option 1- Sell my home in Washington State under a Sole propriety for minor tax benefits to my understanding. Use the net proceeds to invest but how much? I must keep in mind I need to pay down my own debt or at least that’s my belief. Get utilization down so I can apply for bigger loans to invest into passive income.

Option 2- Hold on to my home in Washington State... Wait for the market to sell at the right time, then invest into more real estate. Downside is, I wouldn't have a lot of capitol to use. I would still have higher amounts of credit card utilization. And I'd probably be paying a property management team to collect my rent. I've looked at different rent calculators, but the information looks really skewed.

Option 3- Sell my home in Oklahoma. I owe approx. 140K, the market says I could potentially get 190K. Use the capitol to invest into real estate and possibly a house depending on the right situation. I've thought about doing a 1031 like-kind property but have no clue how it works other than a 3rd party handles the transaction, and you have 45 days to identify replacement property.

Goals- I want to start my own LLC and see that it could possibly help me out financially. I spoke with a CPA advisor from wealth ability, and I only see benefits, thank you bigger pockets podcast! I need to come up with about 8K more to retain the CPA for this year's taxes. What I didn't know is that tax deductions based on legal entity has no meaning when filing for deductions.

[Jason Wray]

Benjamin,

Why not do a cash out refinance so that you can take out the cash and keep your rentals fro the income and long term benefits.  

[Nathan Gesner]

Quote from @Benjamin Gonzales:

I think you're paying too much for your CPA. I spent $9,000 on my CPA last year, but they did a ton of work with my four businesses and my personal tax returns. I'm certain mine are far more complex than yours. She got me a $45,000 refund and it's the first year I haven't paid a dime in taxes.

[Benjamin Gonzales]

@Nathan Gesner Do you have other referrals for a CPA? I am looking to hire and understand how I can maximize my deductions. I am just starting out and have never used a CPA! I've owned property since October 2016, but I have not really done much with it.  I am looking to connect with seasoned professionals like yourself and would love to hear more about your services.

[Deandre P.]

With option 1, where would you live? Would you have to rent and if so are the rental rates in your area near/higher than your mortgage? Do you have any equity in your WA home where you can get a HELOC? Or Do you have any equity in your OK home where you can do a cash-out refi to use for another investment property?

[Nathan Gesner]

Quote from @Benjamin Gonzales:

@Nathan Gesner Do you have other referrals for a CPA? I am looking to hire and understand how I can maximize my deductions. I am just starting out and have never used a CPA! I've owned property since October 2016, but I have not really done much with it.  I am looking to connect with seasoned professionals like yourself and would love to hear more about your services.

Nope. I used Telma Landhorian with Elite Consulting out of Illinois. They were expensive, but they saved me double what I paid them and it got me on the right track for the future.

[Steve Clifford]

Don't sell property if you can keep from it. I'd look into a HELOC (Home Equity Line of Credit) on your WA home, as I believe that should have more equity than the OK home, depending on certain factors. That allows you to have a line of credit against your home at (usually) a far lower rate than a cash out refinance. It's a line of credit, so you'd still need to make monthly payments on it, BUT if you're able to use that HELOC for a downpayment on another property, you should use your rental income to pay the mortgage and your payments on the HELOC. This option may prevent you from being cash flow positive for a couple of years, but you should be able to gain equity in your rental property over time.

I know a couple of GREAT lenders who offer 10%  down investment loans also.  If you're looking to purchase in WA, let me know and I can get you in touch. I'd also be happy to represent you on the real estate side for your purchase. I hope this helps!

[Grant Schroeder]

@Steve Clifford are your lender contacts with 10% down investment loans at Academy Mortgage?

[Benjamin Gonzales]

Quote from @Steve Clifford:

Don't sell property if you can keep from it. I'd look into a HELOC (Home Equity Line of Credit) on your WA home, as I believe that should have more equity than the OK home, depending on certain factors. That allows you to have a line of credit against your home at (usually) a far lower rate than a cash out refinance. It's a line of credit, so you'd still need to make monthly payments on it, BUT if you're able to use that HELOC for a downpayment on another property, you should use your rental income to pay the mortgage and your payments on the HELOC. This option may prevent you from being cash flow positive for a couple of years, but you should be able to gain equity in your rental property over time.

I know a couple of GREAT lenders who offer 10%  down investment loans also.  If you're looking to purchase in WA, let me know and I can get you in touch. I'd also be happy to represent you on the real estate side for your purchase. I hope this helps!

That sounds very interesting! Pulling a HELOC out would pay dividends in my opinion in this market. Investing this money into more houses in WA would be a great move... But I have to move unfortunately and I am trying to make connections with people down in Texas. I'm always available to hear what offers are out there!

Thank you! @Steve Clifford

[Steve Clifford]

Quote from @Benjamin Gonzales:

Quote from @Steve Clifford:

Don't sell property if you can keep from it. I'd look into a HELOC (Home Equity Line of Credit) on your WA home, as I believe that should have more equity than the OK home, depending on certain factors. That allows you to have a line of credit against your home at (usually) a far lower rate than a cash out refinance. It's a line of credit, so you'd still need to make monthly payments on it, BUT if you're able to use that HELOC for a downpayment on another property, you should use your rental income to pay the mortgage and your payments on the HELOC. This option may prevent you from being cash flow positive for a couple of years, but you should be able to gain equity in your rental property over time.

I know a couple of GREAT lenders who offer 10%  down investment loans also.  If you're looking to purchase in WA, let me know and I can get you in touch. I'd also be happy to represent you on the real estate side for your purchase. I hope this helps!

That sounds very interesting! Pulling a HELOC out would pay dividends in my opinion in this market. Investing this money into more houses in WA would be a great move... But I have to move unfortunately and I am trying to make connections with people down in Texas. I'm always available to hear what offers are out there!

Thank you! @Steve Clifford

 No problem! Just a thought, but I think that would work out very well. I actually have a great lender licensed in TX who may be able to help you with a 10% down investment program. Let me know if that would help and I'd be happy to get you in touch.

[Steve Clifford]

Quote from @Grant Schroeder:

@Steve Clifford are your lender contacts with 10% down investment loans at Academy Mortgage?

 Hey Grant. They unfortunately are not. 

[Grant Schroeder]

@Steve Clifford we have a 10% down investment loan for 1-4 units at Academy Mortgage with rates .375% - .5% less than conventional rates and I have not run into another company that offers this. Who is the lender you know with a 10% investment loan? Or is this just a second home loan?