All Forum Posts by: Bily Elliott

Just want to update/answer some of the post/questions that I have seen on this. I AM inquiring about a loan, not a distribution. Like several people have said, up to 50% of the balance or 50K is the maximum that is allowed to be loaned against. I did not ask many, if any questions about if my employment is terminated because I work for my father and pretty much run his company, if I am no longer here he would have to start working again full time so my continued employment is as close to guaranteed and any job can be. This will NOT be for a primary residence, so the terms will be UP TO 60 months, at 2.5% interest on the note paid back to myself in weekly payments. I CAN pay the note off early AFTER 12 months. I can get a loan for several different things; college education, medical, several other things, and then there is a box to check for other and then it says to specify. When I spoke to the guy on the phone, he said an investment property is fine to use as the reason to get take out a loan. He said they process in less than 5 days usually, and we just had one done for a guy that works here so as soon as I decide I want to go ahead with it I am good to go.

There are a few OTHER properties that are foreclosures, not short sales, that have come on the market in the last few weeks in the area I already have a rental and that I want to stay in. My plan now is shortly after the new year I will take out a loan for 30K and make a cash offer or two on some of these properties that are listed in the 30K range. Hopefully I can get a GREAT deal on a property or two, get them rented out, then save up those rents and roll them into more properties. That is my plan anyway!

I am looking at a property that is for sale via short sale, it is a low cost home, but not in a bad area. It is listed at 30K, I plan on getting a 401K loan and making an offer. The 30K list price means that the lender has agreed to take that price right? Would I be crazy in offering 20K with proof of funds and being able to close in 5 days?

I plan on calling my 401K company first thing Monday morning, but I was wondering if anyone on here had any experience with 401K loans? There is a property for sale in my neighborhood, 3 bed, 2 bath, 1000 sq ft for 30K. It is a short sale. Can I get a loan BEFORE I make an offer or what would be the best route to go?

I will call my bank today and see what kind of options they offer. I have been watching this property online for months now, it seems like a VERY good deal, I am very surprised it is still for sale. It is not in a war zone, structurally sound, and seems to be priced at a fair (not great) price. I have been reading a lot lately, my first purchase has been a great property, but I, like many others happened to get lucky with it and having a great tenant helps. I think from doing my reading, I want to find properties that cash flow $200 per unit after applying the 50% rule. I really would like to see what the numbers would need to look like for this property to make that happen.

There is a duplex that has been empty and on the market for almost a year now. Bank owned, two story, built in the 30s, each unit 2 bed, 1 bath about 700 sq ft per unit. There is also a utility room on the lower level with washer and dryer hookups. Asking price was $49,900 then dropped to $39,900 back in May with no price movement since then. I have looked around the outside, it is in surprisingly good structural shape, interior in not bad, needs paint and flooring, so some work, but not a ton. The only fixed cost I know for sure are the property taxes of $1000 per year.

I called about a duplex for rent a few blocks away, same vintage, looks to be about the same condition from the outside, rent is $425 per month, tenant pays all utilities.

I have one SFH that is a rental and I really would like to start adding more, my first house I paid cash for a few years ago, and have been saving some of that rent back. I don't have enough to pay cash for this one and I assume financing will be tough, does this sound like a HML type of deal? What other numbers do I need to know before I can make an offer on this to turn it into a long term hold cash cow?

Here is the short of the story. I have a paid for SFH that is a rental property worth around $45,000. I am looking to buy another property or two, more than likely a foreclosure, so financing the new properties is probably out of the question. I have some money, around 10K saved up from the cash flow of the existing rental property. My income from work pays all of my bills/house payment/everything else with a little left to go into savings each month. What is the best way for me to get the equity out of my paid for rental property so I can buy another property or two?

I for sure did not want to turn this into a "good debt" verses "bad debt" debate because everyone has their own opinions on what they are comfortable with and that is ok. I guess more as I got to typing my first post out I was wanting to learn more about a cash out refinance. The way I see it, that is about the only way I will be getting into another property any sooner than in several more years of saving. I have looked at a ROBS plan pretty hard, but I would like to leave my 401K out of anything I have going forward.

Here is a little background about myself. I am 30 years old, married, have an 11 month old son and my wife is a stay at home mom. We both love this, I never want her to work, nor need her to for the money. I make pretty good money, take home pay is around $1200 per week. Our mortgage is $900 a month, taxes and insurance included. We have one paid for SFH, very small, 600sf and rent is $450 a month. I have had the same renter there since I bought the house. We have a little savings, around 10K, not counting emergency fund and our monthly checking account. I would like to buy another rental property and I have a few ideas I would like to float out and get some input. I would like to get into multifamily housing soon, would really like a quad or two and then get into small apartment complexes. I would like to keep my debt as LOW as possible. I don't want much risk. I would rather have 3 or 4 paid for units than 15 units with a note attached to them. There is a foreclosed duplex close to me. Not a great area, but not bad either. I would not be scared to be there at night, so it is a good area I would say. It is listed at 40K and has been for sale at that price for over 6 months. It would take a little work, but not much to be ready to be rented.

Here is my dilemma. I want to pay cash for things, but it will be several more years before I have enough to buy another property. If I decide I want to take some risk and get a cash out loan on my existing rental that I know will pay for this duplex should I? An 80% loan on my existing property would be plenty to buy the duplex (or another similar property in this area), fix it up, get it rented, then I can use the cash flow from 3 units to pay off the one note. I would be able to sleep well at night know that if I have a unit that is unoccupied for a few weeks I can still pay my bills. That way I don't have to get the first person who wants to rent it in the unit so I can pay the bill. It sounds like I have made up my mind that this is a good idea, does anyone have any advice?