Should i do $269k 4- unit Adelanto CA w/ $7k down FirstTimeBuyer?

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Should i do $269k 4- unit Adelanto CA w/ $7k down FirstTimeBuyer?

Christopher Abernathy
Solarcity FEC · Torrance, CA · Member since 2015 · 89 posts · 13 votes

after repairing my credit as well as families.

I want a 3-4 unit property and im willing to live on site for a 6mo - 1 yr no prob.

i was hoping for a 1% or 0% miracle yet i have heard these are for SFH using CAL HFA in combination with ZIP or MY HOME?? not available for Multi family?

on BP podcast show 210.,I hear of smaller banks with no PMI on less than 20% down.

and my other light at the end of the tunnel was a 3% down multi family qualifying loan with no PMI if you are 720 FICO and 3 month reserves in bank.

i I am now credit worthy (mortgage score qualified) and after selling my wife on the fact that our 2016 tax return ($7,000) must all go towards our first Investment property and first property in general as downpayment/reserves. I just heard about cal HFA Multi-fam owner occupied GSFA Platinum down payment assistance grant, and then... days later ... POOF! All lenders i have contact with seem to think its on hold / gone / not being used or in affect ??

FYI my current situation is:

ME - FICO 665 middle score / $45k/yr income / $200/mo DEBT

WIFE - FICO 650 score / $0 income / -$625/mo DEBT

BROTHER - NO FICO - currently building / $30K income / $0 DEBT

available max Down Payment $7,000

PRO's

Willing to purchase duplex / tri / fourplex in : riverside / rialto / pomona / ontario / san bernadino (no orange/red Crime map)

price range : $180k - $450K

REQUESTS: need atleast one unit to be 3 br

*looking for value add* as well,

After hearing the hundreds of first step methods, im finding it a bit hard to narrow down my search criteria.

2nd question is:

After stating our current situation, what other strategies loan programs or methods to begin our first MFH buy and hold purchase would our financial situation warrant the most profit and least risk in this interest rising CA desert property market?

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  • Aaron Mazzrillo
    Investor · Riverside, CA · Member since 2011 · 2k+ posts · 3k+ votes
    9y

    You just fixed your credit and now you're ready to lay it all on the line and invest in Adelanto? That's like walking out of Gambler's Anonymous and heading straight for the craps table to celebrate your passing the class.

    I know Adelanto has the whole weed thing going on, but I can't think of any reason to ever own units in such a horrible place. I don't even like stopping there for gas on my way up to Mammoth. I can't imagine dealing with tenants who have to live there.

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  • Christopher Abernathy
    OP
    Solarcity FEC · Torrance, CA · Member since 2015 · 89 posts · 13 votes
    9y

    lolz, great analogy. that makes sense yet i really despise renting and by purchasing a SFH, id have to go just as far out and to the same areas i listed to break even if rented it out later.

    I have to be willing to take what i can at the moment and im not too worried about screening tons of tenants before choosing. 

    any other suggestions with so little down?  

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  • David Dye
    Real Estate Investor · Torrance, CA · Member since 2015 · 186 posts · 45 votes
    9y
    Christopher Abernathy With a mid 600 FICO, it is going to be very costly to "buy out" the PMI (this is essentially what it happening when you say no PMI under 20%... You pay for it in the rate). With a low down, your best option here would be to get an FHA loan and build from there. Slow and steady. Yes, it is true there has recently been some changes recently in some of the down payment assistance programs. That said, I would not count on them or use them. If at the current time you are unable to put 3.5% down, you should probably wait a little bit and save up some more. These investments at 3.5% are already risky enough as you won't have much equity in the deal, any less than that would not be a very responsible investment. Anyways, please feel free to PM me if you want me to go into more detail. Would be happy to give you more of my take on the financing side. Hope this helps! Cheers! David
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  • Christopher Abernathy
    OP
    Solarcity FEC · Torrance, CA · Member since 2015 · 89 posts · 13 votes
    9y

    @David Dye Thank you for the positive advice.

    These are great points about paying for the lack of equity or skin in the game on points!

    Never realized that side of my initial investment. 

    I sent PM info. talk to you soon :) 

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