Ohio Real Estate Investments

[Jesse Ferguson]

Hello all! I am somewhat new to investing, I have read a lot of books on finances Psychology of Money, Rich Dad Poor Dad, The Book on Rental Property Investing ect... I understand the basics, I am hoping a local investor can give me a second opinion in my situation.

Me and my wife own 1 rental property in Lebanon Ohio (our first). We lived in this condo while we renovated everything. It is now worth 130k (in my opinion) We will have it paid off and are looking for the next condo, also might be interested in single family / multi-family homes. In this current market I am honestly just looking for a good deal and open to several ideas. With that being said we are not wanting to overextend ourselves.

1) how big of a loan should I consider?

2) should I try to pay off that loan ASAP or just pay the minimum and get more condos?

Just looking for a second opinion!

Thank you!

[Melanie Blazek]

Hey Jesse, 

You should look into buying a property Creative Finance, Seller Financed, and SubjectTo. 

There are many benefits for you as an investor and for the seller when using these strategies.

If you aren't familiar with Creative Finance and want more information, lets connect! 

[Jordan Fiore]

Multiple different variables for making this decision. Are you looking to refi and buy 2 multifamilies with the cash provided for the down payments? Find a single family that needs work and BRRR it. A few different ways to go about things here.

[Randy Rodenhouse]

How fast you pay down your mortgages depends on your rate and terms of your note and of course personal preferences.  I would ask myself what is the rate of return on your money if I use it to payoff the property (usually the interest rate on the note) and can I do better investing that money somewhere else.  So lets say you interest rate on loan is 4% and you feel confident you can make 10% on buying a note or doing private lending or buying another rental then better to not pay down the loan and use the money to invest elsewhere.  

[Michael K Gallagher]

Quote from @Jesse Ferguson:

Hello all! I am somewhat new to investing, I have read a lot of books on finances Psychology of Money, Rich Dad Poor Dad, The Book on Rental Property Investing ect... I understand the basics, I am hoping a local investor can give me a second opinion in my situation.

Me and my wife own 1 rental property in Lebanon Ohio (our first). We lived in this condo while we renovated everything. It is now worth 130k (in my opinion) We will have it paid off and are looking for the next condo, also might be interested in single family / multi-family homes. In this current market I am honestly just looking for a good deal and open to several ideas. With that being said we are not wanting to overextend ourselves.

1) how big of a loan should I consider?

2) should I try to pay off that loan ASAP or just pay the minimum and get more condos?

Just looking for a second opinion!

Thank you!

 @Jesse Ferguson Congrats and welcome to BP, I used to drive through Lebanon often on my way to Miami U. Beautiful area.  

To address your question there is really no write or wrong here. But in my mind the most powerful tools and programs out there are for owner occupants. So if you are able to take advantage of and FHA house hack that to me would be a solid next move. The low downpayment in my mind make it very low barrier to entry.

[Jacob Hornberger]

You will be able to get a good idea of how much you can afford by talking to a lender. After that, then you can decide how much of a loan you're willing to take out. Without knowing anything about your situation... I would suggest renting the condo you have currently and buying a 2-4 unit property and house-hacking it. That will help offset your new loan payment. 

As far as paying off a mortgage early, everyone is different. As long as my interest rate isn't crazy high and my property is cash flowing, I see no reason to pay it off early. You can scale your portfolio a lot faster by using leverage, you just have to manage the added risk.

[Patrick Drury]

@Jesse Ferguson
1) talk to a lender and see what you are pre-approved for
2) If you are buying in Lebanon the deal should be cash-flowing so I would pay the minimum and get more condos. It's a better way to scale vs getting 1 paying down the mortgage all the way then looking at getting another one. It just depends on how risk-averse you are though.