All Forum Posts by: Allen McGlashing

Does anyone have recommendations on an investment property insurance company in Ohio that will be able to give quotes for a property in a LLC. I have been running numbers and I have been accounting for 150/month in insurance. I wanted to give a couple places a call to actually have a real idea of the numbers. Would love to hear who other investors in the area are using.

@Katie Han

Welcome to BiggerPockets this is the place you need to be if you want to start you real estate journey. So my thoughts are why not "House-hack" that seems like the perfect fit for you at the moment. You would be able to get into a multi-family house for 3.5% down FHA loan and possibly cashflow. Depending on your comfortability you could rent out extra rooms you have to make more cashflow. Even if you don't cashflow you are most likely not paying anything close to what you would be paying buying a condo strictly for yourself or your current rent.

Make sure if you do go the house hack route run the numbers to make sure when you leave the property will cashflow.

You have a great opportunity in front of you if you use it right you will be able to generate passive income and build wealth.

@Aaron Akins

First off congrats on how much equity you have in your home from buying in a great area.

If your ultimate goal is to invest in real estate I would definitely be refinancing into a 30 year mortgage. That gives you so much options  

1. -Cash-out refi with $165k to pull out and that would keep your mortgage payment the same as is now. 

• - refinance into a 30 year then take a HELOC out. Which would most likely lower your monthly payment if it's interest only payments ( which would be your best option to keep your DTI low to qualify for a traditional loan).
  
  

1. If you are worried about your DTI then I would get the HELOC it looks better on your balance sheet when getting a loan. I highly recommend you refinance into a 30 year loan and access some of that equity to build a real estate portfolio. With $285k you will be able to scale much faster than with just having $120k (obviously if you do it right).
2. 
   Good Luck; your in a great position right now and being here on BP will only help.
   

@Jacob Beg

You definitely dodged a bullet in my opinion. The risk wasn’t worth the reward. Reward being you would have had instant cashflow (at least you think). Risk could have hurt you a lot more by her not paying rent then you’d have to spend money on an eviction and who knows how long that could take. Attorney fees then no collected rent a negative huge hit. Tenants are one of the most important things in real estate they make or break the deal ultimately. 

So I say good job spend a little more time finding a better tenant even if it means losing a month of cashflow.

@Eric Anderson

I just went through the process with taking a HELOC out on my PRIMARY home for 95% LTV to do the day exact thing INVEST IN REAL ESTATE. What I learned was ask everything that comes to your mind whether it be to your loan officer or her on BP. 

Some basic things to know when going into it is ask

• - Is it interest only payments?
• - what the rate is?
• - how long is the draw period?
• - how long is the repayment period?
• - how much is closing costs?

@Kevin Felger

I do not live in the Ohio area, but I am investing in multi-families in Columbus and Cleveland so I could bring some perspective to the conversation. Would love to connect. 

@Rema W.

Listen to the newest podcast on @realestaterookie their guest Brian Davila states to contact a local eviction attorney for advice it usually is free and maybe they can show you another easier way to handle this situation.

@Luke Siecinski

There is a lender that I just went though that will give you a HELOC on your property at 95%LTV. So after running the numbers on your house and the info you had provided.

Home value=$235k

Owe=$186k

95% of $235k=$223,250

$223,250-$186,000= $37,250

so you would be able to access $37,250 of your equity minus some closing costs. 

Feel free to message me if you would like more information and my loan originator.

Hope this helps.

@Justin Ruholl

First off CONGRATULATIONS on your choice to start real estate so early. If you continue you will be well off a lot sooner than most.

The deal looks good initially, it meets the 1% rule. You need to know your home, is it older, will the repair/maintenance category need to be higher than 5%? I would add the cost of having a PM in there too, you being so young your probably going to want to expand in buying more properties and eventually it won’t make sense to manage it yourself. Even with increasing some of these categories the deal still looks good. I try to get $200/a door. 

@Suan Aik Yeo

My first thought is why not refinance at a 30 year fixed rate, the rates are still very low and that would make your payment lower since you have so much equity in your home which would increase your cash flow monthly probably drastically. 

Selling your home will cause you to pay capital gains tax and that takes a huge chunk out of your profit. You will also lose any appreciation that the house will create in the future while the tenants pay down the mortgage and inflation hits. If you have the money to get into your new house I recommend keeping this one as a rental there are to many benefits not to take advantage of.

GOOD LUCK IN YOUR DECISION