@Ryan Austin I'm a huge fan of using local lenders and portfolio loans. Personally, I've found their products to be better than the large banks in our area. That said, our local lenders only require 20% down and have extremely competitive interest rates. Are there other local lenders you can chat with? You should absolutely shop around, I've found that the loan products that banks and credit unions will offer vary so much! At the end of your search you should choose whatever product is a better fit for your particular situation. Keeping more cash in your pocket (to further invest with) and lower mortgage payments as stated by @Jaysen Medhurst is usually the goal too!
@Ryan Austin I'm a huge fan of using local lenders and portfolio loans. Personally, I've found their products to be better than the large banks in our area. That said, our local lenders only require 20% down and have extremely competitive interest rates. Are there other local lenders you can chat with? You should absolutely shop around, I've found that the loan products that banks and credit unions will offer vary so much! At the end of your search you should choose whatever product is a better fit for your particular situation. Keeping more cash in your pocket (to further invest with) and lower mortgage payments as stated by @Jaysen Medhurst is usually the goal too!
It would diversify my risk in purchasing multiple properties in a portfolio as opposed to a single property. Seems like a smart thing to do at this point in time given uncertainty of job market for so many people.
Hi @Kelly Skeval thanks for the response! I have a list of 5-6 places to call now. A little extra leg work is hopefully going to add up to a lot of savings and added value to my plan!
@Jaysen Medhurst thank you for your input! It is definitely on my radar much more seriously than before. I have to keep digging and crunching numbers to see how it all adds up. I had been getting info on homes that were 20-35k and renting around $700/mo hence the desire for portfolio loan to be able to buy a bunch of them (if supply allows). But given the terms (and more leg work will yield additional options) I might have to look at what a higher dollar home might get me and go for higher quality over quantity.
@Ryan Austin Just judging by the price, $25-$30k houses are probably unstable, thus risky, even when the cash flow is better on paper, and even if you won a few. If I were you, I would avoid those houses and buy one that is at least $60k, probably $80k+. Are the properties in IN?
@Ryan Austin, when you write "portfolio loan" are you referring to one loan that covers several properties (more accurately called a blanket loan) or a loan written by a lender who holds in it in their portfolio (as opposed to selling it on the secondary market)?
$20-35k homes that rent for $700? That sounds like a nightmare waiting to happen. What is the tenant class like? What kind of person do you think rents a house that could be bought for $20k. I'm sure the numbers are making you drool, but is it worth it?
At those prices what does MFR look like near you? Why bother at all with SFR?