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How Should I use $50k?

Posted Feb 8 2024, 21:31

Hello, Bigger Pockets community, I am currently 18 and would love to hear your guys' thoughts and opinions on my situation.  I am currently 18 years old with a 700+ Credit score.  My father recently offered me a car and I was ecstatic about the idea.  He is taking out an equity loan on the house of about $120k to make home improvements and was gonna use $50k of that to get me a car and I make payments to him instead of the bank.  Now I decided what if he just gave me the cash instead for us to get our first fix and flip or start our own business?  I have been researching for months now on different ways I can go about this and some of the things I have been studying and thinking of pursuing are Mobile Home Fixing and Flipping, as well as regular house fixing and flipping.  My question is what can somebody at my age and situation do and how should I go about this?  Is this a sufficient amount of funds to start and how would it work in getting another loan on top of this one?  I was thinking private money would make more sense but would love some insight on this.

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Jason Wray
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Jason Wray
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Replied Feb 8 2024, 22:23

Sebastian,

If you have a full time job I would advise using some of the money to buy a Primary Home. You only need 5% down which covers 2-4 Unit multifamily properties. You can also buy any Modular or Manufactured homes (Mobile) you want to focus on double wide if possible. Reason I tell you to only use part of the $50K is because its better to use the banks money.

That also allows you to stay cash fluid and have reserves for repairs and renovations. If you buy a 2-4 unit you can rent out the other doors and claim one of the units as a primary. You can refinance in 6-12 months and move out of the other unit and rent it out. Buying as a primary saves you from having to put 15% down.

Mobiles/Manufactured are great and cost efficient so either way you can buy something and only need to use a small portion of that $50K. You can buy 2-3 properties depending on your location and sale price. You can also have your father or family to help co-sign as well if you need to show more income. If you focus on a 2-4 unit the rents of the other units can be used as income on the purchase to help your DTI.

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Replied Feb 8 2024, 22:32
Quote from @Jason Wray:

Sebastian,

If you have a full time job I would advise using some of the money to buy a Primary Home. You only need 5% down which covers 2-4 Unit multifamily properties. You can also buy any Modular or Manufactured homes (Mobile) you want to focus on double wide if possible. Reason I tell you to only use part of the $50K is because its better to use the banks money.

That also allows you to stay cash fluid and have reserves for repairs and renovations. If you buy a 2-4 unit you can rent out the other doors and claim one of the units as a primary. You can refinance in 6-12 months and move out of the other unit and rent it out. Buying as a primary saves you from having to put 15% down.

Mobiles/Manufactured are great and cost efficient so either way you can buy something and only need to use a small portion of that $50K. You can buy 2-3 properties depending on your location and sale price. You can also have your father or family to help co-sign as well if you need to show more income. If you focus on a 2-4 unit the rents of the other units can be used as income on the purchase to help your DTI.


 I appreciate the input!  I am currently a full-time student and I own my own mobile detailing business so it may be a little difficult to get approved for a property like that (Multi-family).  I am looking for more so a business/turning a quick profit and not so much an investment property.

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Ko Kashiwagi#4 Private Lending & Conventional Mortgage Advice Contributor
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Ko Kashiwagi#4 Private Lending & Conventional Mortgage Advice Contributor
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Replied Feb 8 2024, 22:44

Hi Sebastian,

Since you are a full-time student, a business-purpose loan would be a good financing option for you. These include fix & flip and DSCR rental program that don't require tax returns of W-2 jobs, but rather uses your credit and property income to qualify.

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Jason Wray
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Jason Wray
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Replied Feb 8 2024, 22:44
Quote from @Sebastian Camargo:
Quote from @Jason Wray:

Sebastian,

If you have a full time job I would advise using some of the money to buy a Primary Home. You only need 5% down which covers 2-4 Unit multifamily properties. You can also buy any Modular or Manufactured homes (Mobile) you want to focus on double wide if possible. Reason I tell you to only use part of the $50K is because its better to use the banks money.

That also allows you to stay cash fluid and have reserves for repairs and renovations. If you buy a 2-4 unit you can rent out the other doors and claim one of the units as a primary. You can refinance in 6-12 months and move out of the other unit and rent it out. Buying as a primary saves you from having to put 15% down.

Mobiles/Manufactured are great and cost efficient so either way you can buy something and only need to use a small portion of that $50K. You can buy 2-3 properties depending on your location and sale price. You can also have your father or family to help co-sign as well if you need to show more income. If you focus on a 2-4 unit the rents of the other units can be used as income on the purchase to help your DTI.


 I appreciate the input!  I am currently a full-time student and I own my own mobile detailing business so it may be a little difficult to get approved for a property like that (Multi-family).  I am looking for more so a business/turning a quick profit and not so much an investment property.

Sebastian,

I understand but one good thing about being self-employed is you still can buy a home and use the banks money. You can use a DSCR loan or a "1 Year 1099" program DSCR does not require tax returns or paystubs or even a job! Instead it uses the properties rents to qualify and it only requires 15% down. If you do decide to take the leap and buy something just keep those (2) options in mind.

You can also use a "Bank Statement" loan where the banks looks at 12 or 24 months of your business checking account and will add up all of your gross deposits and use 75% of the income as an annual salary. You can buy a primary home under this program as well so it does offer some options for self-employed.

Buying Manufactured homes is a big business and as you grow buying land and creating your own mobile home park is also a great long game. I have a close friend that got into the business back in 2010 and he is now a multi-millionaire. A lot of people thought he was crazy buying old MH's and land and now he is laughing all the way to the Bank! Good Luck reach out if you ever have questions!

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Andrew Wilson
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Replied Feb 9 2024, 05:07

Sebastian, first of all your mind is definitely in the right direction. I would suggest going to meet ups and networking with other investors and meet investors doing what you're interested in doing, like fix & flips. Ask how they got started, their investment goals, how they're growing their portfolio. See if they have any projects going on and if you can check out the property with them. And see if you can assist them by putting in some kind of work. Show them that you're serious. Ask questions.  Just be a sponge. Also talk to your dad and see if he's willing to partner with you on some deals because he is the source of your funds. Best way to learn is to be around people doing exactly what you want to do. You'll be extremely well young man. God Bless!!!

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Dan Sheeks
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Dan Sheeks
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Replied Feb 9 2024, 07:39

My advice would be to read the Bigger Pockets’ book First to a Million (and the workbook). It’s written for young aspiring investors just like you.