Hey guys! new to BP, I'd like to ask some advice.

[Eassa Ayoub]

HI! My name is Eassa. 

I am looking to plan out my next move. I currently reside in a duplex I own with about 10k in equity in the Drexel Hill area. 

The idea I'm thinking of involves a partner who would use a low down payment mortgage, have them occupy the property for 12 months, and repeat. I want to know if that is legal first of all, or is it a grey area?  Also will it be weird to be on the loan as a non occupying co borrower if I am not related? 

Also I am looking to maybe do a fix and flip in the city of Philadelphia. What are good neighborhoods that I can buy pretty cheap in, and then either hold until I can make a good profit, or unload quick for a smaller gain. I've heard good things about point breeze, but that was a year ago and I do not know the market that well. 

Thank you guys so much for the time to read my novice question :) 

[Paul McCormick Jr]

Hey @Eassa Ayoub, 

I don't think your plan to partner in a deal to have them occupy a property then vacate is necessarily a gray area. It's just a matter of specifics I would think, are you talking about a regular SFH or Multi-family property? The only hitch for that plan I would think would be the "low down payment" part for a mortgage you mentioned. If you're talking about an FHA (3.5% down) then I do not believe you can be on the mortgage. I believe this is because it has to be owner occupied and has more specific criteria that you'd probably have to research more. Now there are probably smaller banks or credit unions that may be willing to do 10% down, 90% value loan, or other piggy back variations if you are trying to avoid PMI but keep a lower down payment. If you are attempting to borrow money with another person, I personally would want to make sure you have your i's dotted and your t's crossed when it comes to the specific language in the mortgage or contract you have with your partner about who pays, who pays if it falls through, etc.

Now for Philadelphia, there are probably a lot of different areas you can invest in or look in that would meet your criteria. It's very large obviously so I don't think there is one neighborhood in particular but probably a few different areas. It seems like Point Breeze prices/values are higher than they were a year or two ago, but you can always look. I know Brewerytown was getting scooped up recently and over the past year with talks of commercial/residential development and renovations. The Fishtown area over the past couple years has been expanding, and the edge of it just keeps extending and extending. Now, there are places in Kensington that are being advertised as Fishtown, or East/West Kensington, but your mileage may vary and definitely research and do your due diligence. I'm not sure what your price range is, how much you want to spend on renovations, what your targeted ARV would be, I think that will help narrow your potential search to more specific areas.

Just my two cents though, and also not trying to say you can't find any deals in "prime" areas already, just have to look hard enough, do your research, be prepared, and get a little lucky.