Lender · Corvallis, OR · Member since 2021 · 93 posts · 54 votes
4y
Hi Alan,
You'll need 15% down to purchase a single family investment property (ideally want 20% as the LLPA's and PMI on 15% can hurt), or 25% down on a 2-4 unit . Or you can convert your current FHA property to a rental and purchase another Single Family Owner-Occupied property for 5% down with a conventional loan.
Otherwise, you could do a cash-out refinance to get out of the FHA loan into a Conventional loan and take out enough proceeds for the 15-25% down. Once you are free from the FHA loan, you could look at house hacking a multi-unit for 3.5%.
You've got options. What's your rate on the FHA loan?
Cincinnati, OH · Member since 2020 · 4k+ posts · 3k+ votes
4y
@Account Closed, I think defining some criteria would be your first step. Like what is your goal in your investments, and even more broadly what type of life do you want. $30k could go into REIT shares, a down payment for an out of state rental, a syndication, bitcoin, etc.
When thinking out of state investing: markets you know and/or have a connection to in some form is a great place to start. Family in the midwest, great. Focus on a fairly major metro in that area. Personally, I don't invest directly, out of my own market, because I know I would want to set eyes on my property once or twice a year. If flights are $500, hotel $200, a couple meals out, rental car/uber, on top of all the other costs of owning rentals, that significantly burdens profit. So you might as well buy in a place you would make that trip anyways.
Buffalo, NY · Member since 2018 · 790 posts · 530 votes
4y
@Allan Pilapil I would echo what @Evan Polaski said about defining your goals. When you know why you want to invest in real estate and what you hope to accomplish it is easier to analyze and make a decision rather than get stuck in paralysis.
For example if you are trying to replace your monthly income from your job as soon as possible you will want to find BRRRR deals or turnkeys that cash flow very well. Vs. if you are just planning to utilize the income or appreciation value as a retirement boost you may be ok with low cash flow for now but high likelihood of appreciation in value and rent over time.