All Forum Posts by: Brad Hammond

Hi, @Jose Robles congrats on your the newest member of your tribe!  We are expecting our first kid in about 12 weeks.  I think you are going to need to weigh all the pros and cons and device what you are willing to sacrifice.  For example, are there properties in your price range that you would live in within the school district?  Also, I would analyze the properties you can afford and see what the cash flow (or other financial metrics you want to use) is after the first year or two.  That might help you decide if it's worth it to uproot everyone for this endeavor.  

That's not an issue. FHA criteria doesn't care if you have a conventional loan or not.

Hi @Katharine Sherback, I am racking my brain on how to make this work but I can't think of a way you can do it.   I would double-check with a 1031 qualified intermediary though. 

Hi @Anjelica Smith, if you are planning on house hacking a multi-family property, your only option is going to be an FHA loan. If you go with conventional, you will need to put downat least 15%.

Find out why you were turned down first and foremost.  Once you have that knowledge, you can either fix the issue or call around to other lenders that perhaps don't have that same requirement.  

It all comes down to your personal preference.  I think it is a good idea to take a loan out of your 401k.  You don't need to pay it back out of pocket, the funds will come from your contribution.  I would be willing to bet you will make more off this real estate deal in 30 years than you would in stocks with the compound effect.  

@Patrick Hamlin, It really depends on the deal and your risk tolarance. My thought is if the deal has enough cash flow to pay the HELOC loan as well, you should pull the trigger. If you have enough liquid funds to feed the deal until it gets on its feet, that might work too. Just make sure you analyze the deal really well and forecast how long you will need to pay the HELOC.

Hey @Jaron S., I created my own spreadsheet on Google Sheets.  I basically put in the same outcomes the other calculators did and researched how to find them.  Creating the spreadsheet really helped me learn how the numbers work.  

Hey @Tucker Kincaid, I've noticed that people are quick to say that you can get into a property with 3.5% down but don't mention how high your payments are going to be if you leverage that much, not the mention the MI.  Unfortunately, the only way around it is by putting 20% down but the more you put down, the lower the MI payment is.  It is on a sliding scale so putting more down will reduce your monthly payments.  

I have heard of programs where you don't have to pay MI but the high interest payment doesn't make it worth it.  

Hey @Adam Wells, you have a few great options here and no wrong answers.  I think you should first figure out what your financial goals are and that might help you figure out what direction you want to go.  I am always a fan of having more properties instead of having more cash flow now.  I think you should try and purchase another property somehow.  That might be refinancing and taking to proceeds to purchase another property or selling the first one and buying two.  While you might now cash flow as much right now from another property, in 5 years, you will have generated a lot more wealth from the debt paydown alone.