"Howdy" from Dallas! I tip my 馃帺 to ya for HELOC advise
Investor 路 Garland, TX 路 Member since 2015 路 110 posts 路 43 votes
@Michael Bracken why not do cash out refi on primary at 4.5% 30 year fixed rather than a 6% variable heloc. I would be locking in as much 4% 30 year money as you can right now.
If the rental isn't cash flowing with 70-80% LTV you might be best selling that rental to get the equity out and finding a rental with lower taxes. Have you disputed the property's assessed value?
Even on the rental I think a cash-out refi at 5% for 30 year fixed would make sense. I'd rather have $50k in hand with only $100/month in cash flow than spend $40k out of pocket to get $1000/month in cash flow. That would take like 100 months to recapture the cash savings there. I don't know the exact numbers on your property so these are estimates, but I hope you understand what I'm trying to say.
In summary, I'd lean towards cash-out refi on 30 year fixed loans to borrow some cheap money. Hope this helps!
@Michael Bracken why not do cash out refi on primary at 4.5% 30 year fixed rather than a 6% variable heloc. I would be locking in as much 4% 30 year money as you can right now.
If the rental isn't cash flowing with 70-80% LTV you might be best selling that rental to get the equity out and finding a rental with lower taxes. Have you disputed the property's assessed value?
Even on the rental I think a cash-out refi at 5% for 30 year fixed would make sense. I'd rather have $50k in hand with only $100/month in cash flow than spend $40k out of pocket to get $1000/month in cash flow. That would take like 100 months to recapture the cash savings there. I don't know the exact numbers on your property so these are estimates, but I hope you understand what I'm trying to say.
In summary, I'd lean towards cash-out refi on 30 year fixed loans to borrow some cheap money. Hope this helps!
Hello and thank you for your question! A HELOC card is one of the last ways to go when borrowing unless it has good terms and a responsible user. Remember that there is "good" debt that puts money in your pocket and "bad" debt that takes money out of your pocket. That iis one of the best ways to lookat loans. If you have good debt do not worry so much about the good debt and remember to be a long term thinker. In my opinion small house rentals is a bad way to go unless you are sure that you can keep it occupied. You are usually better off with multiple unit complexes that are large enough to budget for a property manager and not have to manage it yourself and that allows you more time to be income productive and less stress than stressed to be responsible to tenants.
As long as you have debt is providing positive cash flow is desirable and that is more important than having debt. I have been listening to a pretty knowledgable man lately who you might know and his name is Grant Cardone that owns about 4,000 units and he has had some bad experience with SFH.s and talks down about them because they have either 0 to 100% occupancy with nothing in-between. With apartments you can have some vacancy and still having enough tenants paying rent woo you can still make your mortgage payments without taking part or all of it out of your pocket. You would rather have more units at one location than having multiple locations when buying 1 unit at at time.
It usually does not takea the same amount of labor to take care of 40 units as it does to take care of 4. Yes, the tenants in apartments tend to bo less responsible and that is why you want to hire a property manager or a property manage T company with plenty of experience which zooms you to append more time on income productive things. Of couse, your goals and intent make a big difference on how we reply so keep that in mind when you respond. I am 60 years old and I am actually from and raised in Dallas so I might seem a little biased but I want you to do whatever makes you happy.
There are many things I do not know about you so that makes my comments more dramatic depending on what your goals are. If you use a HELOC "Loan" you must know it's terms and conditions are and be responsible to take care of it the best you can and know if it is secured by anything. I am curious about where your rental property is and is it in a good demand area? Just remember that there is good debt and bad debt and try to keep you in that good side. Remember to be long term thinking when it comes to rental properties and the alternatives available to you. There are many personal and business things I could tell you but try to make your decisions. With the what the future may hold and try to be ready for it.
Try to keep control of all the things you are resposible for and only hand part of it to people you trust. Do not assume on anything that is suppose to happen. Track all of your income and expenses in report form and regularly review them with people you trust and understand your goals. Speaking of goals, review them everyday to help keep you on the right path. Concentrate on saving as much income as you can. Do not try to do everything yourself. Develop systems and do not be afraid of hiring other people, they might know something that you do not. Do not believe the title of the people you hire and do not turn them loose until they have proved them self to you. Having written systems should help you in the future of possibly hiring others to do the things you do not like or struggle with.
Good luck to you!p
@Michael Bracken why not do cash out refi on primary at 4.5% 30 year fixed rather than a 6% variable heloc. I would be locking in as much 4% 30 year money as you can right now.
If the rental isn't cash flowing with 70-80% LTV you might be best selling that rental to get the equity out and finding a rental with lower taxes. Have you disputed the property's assessed value?
Even on the rental I think a cash-out refi at 5% for 30 year fixed would make sense. I'd rather have $50k in hand with only $100/month in cash flow than spend $40k out of pocket to get $1000/month in cash flow. That would take like 100 months to recapture the cash savings there. I don't know the exact numbers on your property so these are estimates, but I hope you understand what I'm trying to say.
In summary, I'd lean towards cash-out refi on 30 year fixed loans to borrow some cheap money. Hope this helps!
Right, the refi cash out $50k is money I already have (that renters and appreciation gave me). As opposed to a line of credit that I pay back even with the cash flow. We all know interest rates are going up from here. I feel like in one scenario the gift is already freely given in the other I've arranged to pay for it. I'm sure I over estimated my cap ex as I have just put a new roof on it. I have never disputed the tax assessment but that's a great idea. What could it hurt?
Dispute those taxes!
There are companies that will dispute in your behalf and charge a contingent fee based on the savings. I dispute all my properties every year.
Hello and thank you for your question! A HELOC card is one of the last ways to go when borrowing unless it has good terms and a responsible user. Remember that there is "good" debt that puts money in your pocket and "bad" debt that takes money out of your pocket. That iis one of the best ways to lookat loans. If you have good debt do not worry so much about the good debt and remember to be a long term thinker. In my opinion small house rentals is a bad way to go unless you are sure that you can keep it occupied. You are usually better off with multiple unit complexes that are large enough to budget for a property manager and not have to manage it yourself and that allows you more time to be income productive and less stress than stressed to be responsible to tenants.
As long as you have debt is providing positive cash flow is desirable and that is more important than having debt. I have been listening to a pretty knowledgable man lately who you might know and his name is Grant Cardone that owns about 4,000 units and he has had some bad experience with SFH.s and talks down about them because they have either 0 to 100% occupancy with nothing in-between. With apartments you can have some vacancy and still having enough tenants paying rent woo you can still make your mortgage payments without taking part or all of it out of your pocket. You would rather have more units at one location than having multiple locations when buying 1 unit at at time.
It usually does not takea the same amount of labor to take care of 40 units as it does to take care of 4. Yes, the tenants in apartments tend to bo less responsible and that is why you want to hire a property manager or a property manage T company with plenty of experience which zooms you to append more time on income productive things. Of couse, your goals and intent make a big difference on how we reply so keep that in mind when you respond. I am 60 years old and I am actually from and raised in Dallas so I might seem a little biased but I want you to do whatever makes you happy.
There are many things I do not know about you so that makes my comments more dramatic depending on what your goals are. If you use a HELOC "Loan" you must know it's terms and conditions are and be responsible to take care of it the best you can and know if it is secured by anything. I am curious about where your rental property is and is it in a good demand area? Just remember that there is good debt and bad debt and try to keep you in that good side. Remember to be long term thinking when it comes to rental properties and the alternatives available to you. There are many personal and business things I could tell you but try to make your decisions. With the what the future may hold and try to be ready for it.
Try to keep control of all the things you are resposible for and only hand part of it to people you trust. Do not assume on anything that is suppose to happen. Track all of your income and expenses in report form and regularly review them with people you trust and understand your goals. Speaking of goals, review them everyday to help keep you on the right path. Concentrate on saving as much income as you can. Do not try to do everything yourself. Develop systems and do not be afraid of hiring other people, they might know something that you do not. Do not believe the title of the people you hire and do not turn them loose until they have proved them self to you. Having written systems should help you in the future of possibly hiring others to do the things you do not like or struggle with.
Good luck to you!p
Thank you so much. I would love to talk to you more. You sound like you have seen and done a few things I could learn from. My property is in a good area in Garland Texas and over the last 10 years has had 3 tenants family's. All took very good care. It does have a pool with I DONT LIKE for a rental. I have a CPA that specializes in business and good with real estate. I have a contract attorney. I have had LLC's in the past, none now but will be registering soon.
I am for sure going to focus on multi family. The only reason I didn't before to be honest was courage. BP has been so great and the responses I've received from my first forum question have been great! I love what you said about vacancy. I plan to use management for any property I purchase. I also want to learn "truly learn" about management expenses. I was offered a sit-down with a local management company yesterday just to talk. I want every horror story they have.
I will look up Grant Cardone. Thank you so much.
Thank you for your comments! Since I am in northwest Dallas County I might be near you. Since I am still medically recovering and cannot walk yet you can catch me at home most of the time. Hi Brett, thank you for your response and asking me a question. Both of you have a little experience you are both ready to invest in small apartment complexes (40 or less). I would enjoy helping either of you with my point of view since I am pretty-much stuck at home but I can still use my mind eventhough it is not back to 100%. There are many things about me I have not told you yet but, among other things I held an active broker license for about 30 years but I never have done that full time. I have been in the construction business since I was 17. I have much to tell you about my life and that will come with time. If y'all find a good deal, go for a MF.
Good luck to you both!