Buying my first property-House Hacking

[Ashanta Kelly]

Hello,

I am just getting started in Real Estate and am eager to buy my first property. I intend on buying a multi-family home and living in one of the units. I am currently working on my credit and saving money for a down payment. I plan on getting a FHA loan at 3.5%. I was wondering if anyone could give me some advice on certain things I should be looking for in the property. Should it be in great condition or should I go for something lower price that needs some rehabbing? How do I get extra money for the rehabbing? Also, after I develop cash flow from this property, how do I move onto the next property to make money?

Thanks!!!

[Juan S.]

@Ashanta Kelly to answer your questions first I would find out how much of a loan you can get approved for. Call around to a couple different banks to get this information. You want to get approvals for the FHA 203k loan as well just in case the deal might need some rehab. The cost of the rehab will built into your mortgage.

Properties that need rehab or properties in great condition. Well that all depends on your confront zone. Will you be comfortable with managing contractors. Will you be comfortable living in the type areas that typically have distressed small multifamilies even if it is for a year. And who is your targeted audience for tenants. What quality of people you want to rent your units.

How do you move to the next property. You can do a Home Equity Line of Credit (H.E.L.O.C) assuming you have enough equity in the deal. Or a cash out refinance both have its pros and cons just search for some blog post about the difference to educate yourself.

If there is no equity save as much cash flow from the deal as you can if not all and cash flow recycle. How ever you plan to save for the first down payment continue to save that way for the second and add your added cash flow to that.

Hope this help let me know if you have other questions.