All Forum Posts by: Alexander Felice

Use private money to buy your next property below market cost so you own it at 80% LTV when it's ready for the loan.

You can create equity or you can buy equity (as a downpayment), doesn't make a difference to the bank. 

I live by Fort Bragg, I know a TON of full time military people who invest in RE no problem. Many of them deployed for quite a bit of the year too. I know a handful of cops/prison guards who do it as well, unless you're working a ton of overtime I don't see being a cop to extend any additional challenges to RE than any other job. 

I would focus more on the benefits: you'll know the neighborhoods better than most people, and most people give lots of goodwill to prior service/law enforcement members.

Most importantly is to build your RE business around the life you've created. If you aren't doing RE as a full time active job then just make sure to build it to be completely passive from the very start. 

you're saying you used the equity in one home to buy another. Now you want to refinance the second home to pay off the first? if that's the case, just leave the second house paid off, same results, WAY less cost. 

Or are you asking if the 45k in equity can be spent to pay off the original loan? because that's what it sounds like, but that doesn't' make sense.

you have the original home, you owe 60k on it. a year later the bank says it's worth 125k. you can't take a 45k loan out to pay off the 45k on the first, that's just trading debt for the same debt. 

no dumb questions. These things can be confusing.

Also, try drawing these scenarios out in balance sheets, it might help to see where all the debt/equity goes to understand it easier. 

long term loans are generally fannie backed, so use their loan matrix to determine LTV.

https://www.fanniemae.com/content/eligibility_information/eligibility-matrix.pdf

You can use any bank for the refi

You can have 10 fannie mae loans total

Prudent investors look at both ROI and Cash-on-Cash ROI. Both are important and in many ways total ROI is a lot more important than COC

On this website you'll often find people who ignore ROI and only look at COC, this seems to be common with beginners with very few resources and they want to maximize them under any condition of risk. Buying a lousy deal can become profitable on paper with enough debt, but it doesn't always make for prudent investing. 

My personal reference is a mix of much of what you asked and using the advantage of each. I use CASH to buy because it gives me negotiating leverage and speed of transaction. Then I put long term fixed debt on the property but not before creating at least 25% equity, so my total loan is 100% of my funds but only 75% LTV. This allows me a high ROI, infinite COCROI, and the advantage of using cash as you mentioned.

Hey David, going to your local meetups is one of the best things you can do. 

I have a little trick that might help you. 

One of the scary parts of these meetups is to go alone. When you end up going alone to a meet and you end up not talking to many people you don't find any value in attending, so you're less likely to go to the next one. This is a super common thing to happen and it doesn't create any positive momentum for you.

So before the next meet find the event online and try to see the guest lists, then email every single person on the guest list and tell them who you are, what you're about, and that you just want someone to shake hands with when you arrive. 

When you arrive, even if you don't get to meet everyone you talked to in advance, the odds that you'll sitting alone completely becomes almost zero. It also lets you feel more comfortable just showing up when you know "Ok I at least know Alex and he seems nice so it's not such an overwhelming social task anymore." 

I hate showing up to places not knowing anyone so I use this trick all the time and now when I go to a new REIA I'll have at least half a dozen people to say hello to, if not more. On top of that, these relationships compound over time like you wouldn't believe.

I hope this makes sense and helps. Simple trick but makes a massive difference to me. Good luck my friend

You'll be taxed at regular income rate, not capital gains rate. I'm not sure what you mean by avoiding taxes? You probably have to (and want to) pay taxes on your profit. 

If the property is in his name then the proceeds will go to him and he will split your half and you'll just explain this to your CPA. no problem there. 

@Natalie Kolodij can make sure I'm not giving bad info. 

Yeah the devil is in the details so you gotta hear it a few times for it to click. Let me know if I can help further. 

Energy is what I do best baby! Thank you for the compliment, I'm grateful.  

"Whoever came up with passive income is someone I'm grateful for. I manage a large rental portfolio from across the country and did so almost from the very start, and it was easy"

Nicole, you know I love a contrarian ;) 

My intent here was really just to provide alternative position for the sake of it, which is kinda my thing. The original thread just made for an easy retort. Having both discussions bring in a variety of perspectives and reply's is a perfect outcome as far as I'm concerned.

Also, as many have noted the other thread was satire, sure, but at best it was poorly constructed with no underlying attempt at productive help. It's like hitting someone in the face then claiming "it's just a prank bro". So whatever the motive for Mr. Greene to be here, which to me seemed malicious under the false veil of sarcasm, I felt it appropriate to remind the thousands of people who see these threads and don't comment, that my motive is to help. If you post something stupid I'll call you stupid, and I do that all the time, but then I try to help. 

It's not like that thread is blocked or anything, just providing diversity of voice.

And while on the topic of theatrics, I don't care about my hair either, it's just a bit. Sometimes I do use it to make @Russell Brazil jealous. That said, I've been dying to get a better glimpse of what I think might be an epic mane on @Andrew Postell