Rental Property Investor · Pittsburgh, PA · Member since 2016 · 20 posts · 12 votes
Hello everyone, I am on the brink of my making my first investment, a "house hack" strategy of buying a multi-plex, living in one unit, and renting out the other. I plan to use an FHA loan to finance my first purchase, and am working with a loan company.
Being that this is my first time going through this process, I am humbly asking if anyone could review the cost sheet that they have supplied for me, and let me know if the different cost items look appropriate, or if I should reconsider some things. They noted that an FHA loan would have some additional fees over a conventional, so someone with experience with FHA specifically would be helpful. I just want to go into this with full confidence! Thanks for any input!
Real Estate Investor · Richmond, VA · Member since 2016 · 10 posts · 1 vote
9y
All looks appropriate to me except the comission to the broker. As a buyer, you normally shouldn't be paying the commision, the seller should. Also looks like they are requesti g the full year of property tax up front, I haven't ever had to do that personally, but maybe that's a requirement where you are?
Rental Property Investor · Pittsburgh, PA · Member since 2016 · 20 posts · 12 votes
9y
Thanks A.J. for the feedback. The broker commission is to make the difference on their "minimum", which in this case is 2k, which 3% of 51.5k doesn't completely cover. My lender gave me the impression that the full year property tax is standard, so without other reference points I was left to assume that is the norm. And yes, there's deals to be found out here near Pittsburgh, this offer may not be accepted and we may end up near the 65-70k range, but I'd be happy with that too.
Looks good and makes sense. The full year of property tax is a bit strange though. Usually it is prorated to seller and buyer. Are you buying this on or off market and is it a foreclosure?
Rental Property Investor · Pittsburgh, PA · Member since 2016 · 20 posts · 12 votes
9y
HI Anthony, this property was discovered on the MLS. We are still under negotiation and not sure if we will be able to agree on a price, but maybe I should ask then about the property tax ? How would that normally be incorporated?