All Forum Posts by: Brent Paul

That seems like a plan for disaster to have that many different unknown people living together under one roof.  I think you will be hard pressed to find residents to fill the rooms in that house.  Me personally if I was looking for a place to live the last thing I want to deal with is 3 other roomates.  Not to mention collecting rent, utilities, etc.  Maintenance will be much higher and more wear and tear than if it was rented to a family.

Why not rent it out as a duplex?

What are the rental rates to rent it as a duplex?

Run those numbers.  Check and double check.

Also keep in mind maintenance costs, , repairs, vacancy costs, property management, property insurance, taxes.   Lots of variables to work into those numbers to see if it can work.

10 months is quite some time away.  I highly suggest you work on your credit during that time.

A very good chunk of your score is just paying bills on time making sure your credit utilization isn't too high.

I was able to raise my score up in just over year by over 100 points.

What kinds of things are on your credit that makes you think your credit is terrible?

The most common things I see that tank peoples scores:

Late payments

Bills in collection

Too many hard inquiries for new loans or credit cards opened recently

Seller financing is certainly an option but keep in mind not all sellers will offer it.  You will need a backup in case that happens and getting your credit up to par will get you a lower interest rate.

250 per month for taxes insurance

870 per month for mortgage

=1120 per month

1500-1120= $380

However that doesn't account for money that should be set aside for vacancy, repairs and if you outsource the property management there will be an additional cost.

Run those numbers and if they look good.  If so then see what the seller says about your rate.  It may take a little negotiation on your part, but stick to your intuition, keep your cool and he might just let you have it.  

Those are some pretty tough questions.  I would suggest speaking to an accountant about your situation.  Specially someone who also owns real estate.  They will be able to lead you in the correct direction.  Tax laws vary by state.

Here's a prior thread on it.  It seems like another overpriced guru

http://www.biggerpockets.com/forums/79/topics/59294-real-estate-education

Save your money and read the how to guides on this site and checkout the podcasts.

Why pay for something you can get for free from people that actually put their money where their mouth is?

This seems like another Guru type of system.  Honestly why spend money for something you can get for free here on BP?

Tons of articles and podcasts on wholesaling.  If I was in your shoes I would skip Lazy and go with the podcasts from real people that aren't out to profit from it.

Wow, now that's a great find!

It really pays to get to know the people you do business with.

Yes you could certainly use a hard money loan as a down payment.  Keep in mind the interest rate will be much higher along with extra fees.  Most people use the Hard money loan for flips as they will refinance or sell the house to pay back the loan.  I have heard of people paying upwards of 15% interest on a loan.

Have you thought about an fha loan?  3.5% down, however you will be required to live in it a few years.  However if you have some equity in the property you can get a home equity line of credit and use that as a downpayment on another property...

There are also quite a few podcasts that cover this exact topic.  I highly recommend listening to those.

There are so many ways to go about this and not enough space to type everything

I suggest you check out the how to guide under the learn tab on top.  
Next start listening to the podcasts.  They pretty much cover every question you have asked.  

One very important thing to keep in mind is you should be checking in with your property manager in a weekly basis.  Whether it's a quick phone call or out for a cup of coffee.  If you don't follow up with him how do you know he is doing his job?

I have heard so many horror stories of people only checking in every 6 months only to find out a rental unit was vacant and there were additional repairs to the property not completed.

At the very minimum the property manager should be visiting the properties once a month.    If the water in the upstairs bathroom leaks into the basement how will you know if you never talk to the residents.