NACA loan for multifamily investment d/t limited liquid funds

Starting Out
8yFollow

NACA loan for multifamily investment d/t limited liquid funds

Erica Viverette
Rochester, NY · Member since 2017 · 8 posts · 0 votes

Hello fellow or beginning REIs, 

I need advice as I've been thinking of obtaining a multi-family property through NACA due to me having limited liquid funds and fair credit. I'm in the process of credit repair as I've hired a company in conjunction with me clearing things up myself however, I still have a long way to go. I feel as if I'm wasting time with all my ideas and learning (although beneficial) yet letting my current situation keep me stagnant. I'm aware that among this loan I will have to owner occupy but I was just thinking of taking the worst apartment and doing repairs myself gradually. Although my money is mostly tied up I don't need this unit for immediate gains. Aside from monthly repair expense reserves and mortgage, I'd like to remainder of funds to until I snowball the total amount and life of the loan adding my disposable income to payments when they become available. The benefit of this to me is an expiration of my procrastination, beginning my REI career now as opposed to waiting, learning about REI with minimal risk, being able to include repair costs to the loan, no closing costs, fair yet improving credit. All advice is welcome!

0Reply
77 views

Most Popular Reply

Carley M.
Investor · Buffalo, NY · Member since 2016 · 100 posts · 71 votes
8y
I created a NACA Experience handout (things I wish I knew before I started NACA) for a testimonial I gave. The short link to that is https://tinyurl.com/ybq4beto 
I also created a purchase affordability calculator so you can find out if the house you’re interested in is affordable based on NACA monthly payment amounts. They don’t tell you that you can afford a house up to $100,000. They tell you that you can afford $600 a month for mortgage, taxes and insurance. This spreadsheet translates that to housing price. The link for that spreadsheet is https://tinyurl.com/y984lsa7 
 I closed on a 4-Unit with NACA (with 30k in repairs processed through HAND) in November 2016. I helped my best friend go through the process and he closed in November 2017 on a double. I have other friends going through the program now too. It’s worth the headache. If you have repairs to make, plan on 90 days to close (based on a a standard 30-day close expectation) because of additions time to get bids, etc. Making your seller aware will help manage their expectations. Good luck!
2Reply
See this reply in the discussion

14 Replies

Jump to latestLatest
  • Marie S.
    Burbank, CA · Member since 2017 · 38 posts · 13 votes
    8y

    Hi, I think I'm in the same boat as you (in CA) but I couldn't quite understand entirely. I'm also hoping to do a NACA multi family, and live in the worst unit. I do know from reading/listening here that PITI, reserves and repairs are necessary to factor in, not sure what you said after that.

    As for repair costs, I think that may depend on your market, in LA everything is sold as is, so I'm not sure how NACA's HAND department will work that, what repairs they'll require or not. I do know in my market it will be impossible to get a seller to agree to any repairs, so I know I'll need all that cash up front, which means less cash I can use to buy down my rate.


    Have you already qualified w/ NACA? It's quite a journey...

    0Reply
  • Erica Viverette
    OP
    Rochester, NY · Member since 2017 · 8 posts · 0 votes
    8y

    Yes, I went to my intake appointment last month and was told to save a designated amount for three months consecutively. I will then return for a follow up appointment in June and hopefully then I will receive the okay to begin looking for homes. We went over so much during intake that I forgot to ask how repairs are factored into the loan. I had to do a few letters of explanation for a couple outstanding debts I had. I've heard horror stories with NACA but have had a good experience so far. I will be calling my worker next week to make sure she's received all my required supplemental documents. I'm glad I found this opportunity. By this time next year I plan to be a first time homeowner, landlord with a new credit future. Please keep me updated.

    0Reply
  • Marie S.
    Burbank, CA · Member since 2017 · 38 posts · 13 votes
    8y

    Well I suggest logging into the NACA Web-file login and uploading your docs month by month yourself. Your advisor will be over run with other cases and will probably not even take your call. I've been emailing mine consistently month after month, and they don't have anything logged since LAST YEAR! Doing it through the e-file assures it's THERE and registered w/out your person having to do anything. Because they won't.

    As for the improvements/updates before buying, they'll give you the low down on that on your welcome meeting once you're in, and they assign your realtor. Learn as much as you can about assessing properties yourself, because the realtor they assign you won't do jack squat. By learning how to run the NACA numbers, you can basically rely on yourself to find properties w/out having to wait around for them. I DO use mine to ask about rents and things once I think I'm good on a property, but I do the legwork first, because they won't. --at least that's how it is at the LA office, they don't have time or brains to do ANYTHING to help you, hopefully NY is different!!

    0Reply
  • Carley M.
    Investor · Buffalo, NY · Member since 2016 · 100 posts · 71 votes
    8y
    I created a NACA Experience handout (things I wish I knew before I started NACA) for a testimonial I gave. The short link to that is https://tinyurl.com/ybq4beto 
I also created a purchase affordability calculator so you can find out if the house you’re interested in is affordable based on NACA monthly payment amounts. They don’t tell you that you can afford a house up to $100,000. They tell you that you can afford $600 a month for mortgage, taxes and insurance. This spreadsheet translates that to housing price. The link for that spreadsheet is https://tinyurl.com/y984lsa7 
 I closed on a 4-Unit with NACA (with 30k in repairs processed through HAND) in November 2016. I helped my best friend go through the process and he closed in November 2017 on a double. I have other friends going through the program now too. It’s worth the headache. If you have repairs to make, plan on 90 days to close (based on a a standard 30-day close expectation) because of additions time to get bids, etc. Making your seller aware will help manage their expectations. Good luck!
    2Reply
  • Erica Viverette
    OP
    Rochester, NY · Member since 2017 · 8 posts · 0 votes
    8y
    Thanks Ladies, I actually determined that I dislike the terms of the loan and almost have credit and money in order to go the conventional route.
    0Reply
  • Sakina Webb
    Rental Property Investor · Member since 2018 · 6 posts · 0 votes
    8y
    Can you be a bit specific for me as this is the route I'm going?

    Any help would be appreciated?

    Originally posted by @Erica Viverette:
    I dislike the terms of the loan..
    0Reply
  • Erica Viverette
    OP
    Rochester, NY · Member since 2017 · 8 posts · 0 votes
    8y

    The major term of the loan that I didn't like was just the fact that they require that you don't own any other properties for the life of the loan but I'm actually beginning to reconsider my decision and will contact them today. I did get as far as meeting with a counselor and developing a savings plan and it seemed to be very promising. I'm sure this post hasn't answered your question and I'm sorry about that. I genuinely can't remember my other reasons. How is your experience with NACA going so far?

    0Reply
  • Erica Viverette
    OP
    Rochester, NY · Member since 2017 · 8 posts · 0 votes
    8y
    Originally posted by @Carley M.:

    I created a NACA Experience handout (things I wish I knew before I started NACA) for a testimonial I gave. The short link to that is https://tinyurl.com/ybq4beto
    
I also created a purchase affordability calculator so you can find out if the house you’re interested in is affordable based on NACA monthly payment amounts. They don’t tell you that you can afford a house up to $100,000. They tell you that you can afford $600 a month for mortgage, taxes and insurance. This spreadsheet translates that to housing price. The link for that spreadsheet is https://tinyurl.com/y984lsa7 

    I closed on a 4-Unit with NACA (with 30k in repairs processed through HAND) in November 2016. I helped my best friend go through the process and he closed in November 2017 on a double. I have other friends going through the program now too. It’s worth the headache.

    If you have repairs to make, plan on 90 days to close (based on a a standard 30-day close expectation) because of additions time to get bids, etc. Making your seller aware will help manage their expectations.

    Good luck!

    Thanks for your comment. I have been on a roller coaster with determining which route I'd like to go for my first property and have decided to retry the NACA program.

    0Reply
  • Erica Viverette
    OP
    Rochester, NY · Member since 2017 · 8 posts · 0 votes
    8y
    Originally posted by @Sakina Webb:
    Can you be a bit specific for me as this is the route I'm going?

    Any help would be appreciated?

    Originally posted by @Erica Viverette:
    I dislike the terms of the loan..

     The major term of the loan that I didn't like was just the fact that they require that you don't own any other properties for the life of the loan but I'm actually beginning to reconsider my decision and will contact them today. I did get as far as meeting with a counselor and developing a savings plan and it seemed to be very promising. I'm sure this post hasn't answered your question and I'm sorry about that. I genuinely can't remember my other reasons. How is your experience with NACA going so far?

    0Reply
  • Carley M.
    Investor · Buffalo, NY · Member since 2016 · 100 posts · 71 votes
    8y
    @Erica Viverette - the not owning other property Is ONLY when you are entering the program. Once you have a house through them, you can own more property. I’m saving for my second place now.
    0Reply
  • Sakina Webb
    Rental Property Investor · Member since 2018 · 6 posts · 0 votes
    8y

    @Erica Viverette @Carley M.  

    Thanks ladies.  I'm at the beginning process.  I looked into it many moons ago and got as far as the first meeting but didn't go any further as it was a time of transition for me.  After reading a few of Carley's post, however, I'm seriously reconsidering it. 

    Carley, you spoke of a packet and attached link to help NACA newbies. It didn't work. Can you send it to me or connect with me directly. Any assistance you can lend would be more than appreciated.

    Thanks.

    0Reply
  • Carley M.
    Investor · Buffalo, NY · Member since 2016 · 100 posts · 71 votes
    8y
    @Sakina Rosendary here is the full link. Those tinyurl links expire. https://docs.google.com/document/d/1yIOrjgwYbdk0JggU1exoPW0qt416n60_ioSmLA5wxKE
    1Reply
  • Sakina Webb
    Rental Property Investor · Member since 2018 · 6 posts · 0 votes
    8y

    @Carley M. Thanks so much.  I printed it out and will use it as a reference!  Best wishes to you @Erica Viverette!!

    0Reply
  • Andre L. Tosch Jr
    Member since 2021 · 1 post · 0 votes
    4y
    Quote from @Carley M.:
    I created a NACA Experience handout (things I wish I knew before I started NACA) for a testimonial I gave. The short link to that is https://tinyurl.com/ybq4beto 
I also created a purchase affordability calculator so you can find out if the house you’re interested in is affordable based on NACA monthly payment amounts. They don’t tell you that you can afford a house up to $100,000. They tell you that you can afford $600 a month for mortgage, taxes and insurance. This spreadsheet translates that to housing price. The link for that spreadsheet is https://tinyurl.com/y984lsa7 
 I closed on a 4-Unit with NACA (with 30k in repairs processed through HAND) in November 2016. I helped my best friend go through the process and he closed in November 2017 on a double. I have other friends going through the program now too. It’s worth the headache. If you have repairs to make, plan on 90 days to close (based on a a standard 30-day close expectation) because of additions time to get bids, etc. Making your seller aware will help manage their expectations. Good luck!
    hey can you repost the links i couldnt get them to work, thanks!!!
    0Reply
Join the conversationCreate a free account to reply, vote on answers and follow this thread.
Log InJoin for Free