All Forum Posts by: Andy Garretson

Hi Sam,

Depending on what your income has been like in the last 12 months or so, you could possibly look at using a bank statement loan or some other alternative financing to buy another house. With your rental cash flow, plus your freelance income, this could get you what you need to buy another primary residence. Let me know if you'd like to discuss as my lending company does a bunch of these types of loans. My cell 615-955-3130

@Mike Turano I have a few clients right now that I am helping finance who are looking for cash flow in the greater Nashville area and they are sticking to multifamily, mainly duplexes and triplexes. There are not a ton of small multifamily's to chose from but they are pretty much your only shot at cash flow in the 200k - 500k price ranges. STRs are better but those price points in middle TN are closer to 600k - 700k minimum and the zoning is very strict.

Investment Info:

Condo buy & hold investment.

Purchase price: $235,000
Cash invested: $15,000

I bought this condo to first live in and then rent out. I ended up loving in it for 8 months and utilized an owner occupied loan again when I bought another primary residence.

How did you finance this deal?

30 Yr 5% Conventional (Owner Occupied)

How did you add value to the deal?

I saw where the market was moving and realized this property was under priced and had been overlooked on the MLS. It has appreciated around 70k in 18 months.

As long as you are going to keep this property and not sell it, a fixed 30 year loan would be better than HELOC.

Refi is a better option for a long term hold.

Hi Anthony,

Low appraisals are pretty common in today's market and a lot of people are dealing with this same issue. However, it is less common to happen on a new construction home as typically the value is able to be supported by other sales in the same subdivision or neighboring subdivisions.

When an appraisal comes in low you have two options;

a. Bring the difference between the appraised value and the purchase price in cash to closing

b. Seller reduces the price to the appraised value

c. Walk away from the deal

First off, you should have been notified immediately and received a copy of your appraisal report after it was completed. I would see if you can negotiate the price down as the market data proves that the homes value is actually less than what they are selling it for.

If you end up paying over the appraised value, if you are in an appreciating market you will recoup your equity rather quickly. As more comparable sales occur, the appraised values will rise. If you ended up waiting until the appraised values have risen, you will risks interest rates going up, prices going up and the missed principle paydown of the months that you own the home.

Andy Garretson