All Forum Posts by: Yan P.

Charles,
If I may ask some details: Community bank or regional? Term of the loan? Secured by your name or just the property? Thank you.

Bump. It also seems to me that it is harder to finance if ownership is all cash. This seems counter intuitive. Can anyone with experience comment as to why.

When buying a 4, 3, or 2 unit. Do you normally leave one unit unoccupied for an FHA owner occupier? I do not see a person buying a 4 unit just for investment b/c of lacking economies of scale unless they own a bunch in the area. In your experiences, how often is it an owner occupied compared to investment property purchase?

Bryan, I imagine a 10 unit property owner-financing is not too conforming. May I ask what the structure of your last loan was and what kind of discount you had to take when you sold it?

Bryan,

I am thinking of buying some rehab's in lower class areas, not exactly war zone, but not Beverly hills either. Can you elaborate on your strategy in these areas? Such as, do you rent out to Sec 8 or do you charge below other landlords for nicer non-section 8 places and the tenants respect your unit more since they have a deposit and are paying each month? And other thoughts...

Thank you in advance for reply

I would be up for a meeting to talk about local economics and how to profit from them.

Touché, Tim & Tom, touché, that is what I get for not actually looking at the video before making the comment. After watching, it’s obvious she was talking about what Tim mentioned and was misunderstood. Further, because it is a snippet, like always in media, you do not get to the part where she elaborates. I am still stoked about Palin’s new show. And about Palin 2012, which should also be great show regardless of your political leanings.

I am equally as excited to watch Sarah palin's brand new reality tv show. I wish all politicians were so open about their lives. Some people think it's just for the money. I believe it's for normal good ol' america. Which I am a part of. I think...

Bryan,

After watching the link to the trailer you posted I went to see the movie. It was great. Since I am a big proponent of education reform in the U.S. and have looked into various theories on how to go about it, I was surprised about how informative and unbiased the movie was. It is sad though that one of the main reformers who was actually getting results was forced to step down from office a week ago. I was thinking it might have something to do with the movie, hmmm...

Makes sense. Most viable option is the refi. Thank you for the too good to be true confirmation.

Thank you for your detailed reply Jon. This is exactly what makes this forum so valuable.

Lets go with your numbers since they are are close to what I am looking for in a property and a good conservative estimate of HML terms in my area.

You ended with a 33% cash on cash return for investment property and 8% cash on cash for owner occupied with $28,950 invested. Which is a great scenario but has a lot of cash tied up. What I was thinking of is the following:

Instead of doing a refi, I purchase the property, after rehab, from my friend via an FHA loan. Let's say I am again limited to 75% of value as determined by new appraisal. So I will be loaning out 150k with 5k in closing costs and 4% down or $6,200. So total loan will be $148K. My total investment bumps up to $32,150. I pay off the 130K from the HML, leaving me with $18,800 left over that my friend pushes back to me (which is what I have legality questions about, do not know what I can name this). This decreases my total investment down to $16,350. My new payment is $892.13. Since it is owner occupied, $2,400 in rent and $1,400 in expenses is about $107 in profit. This is also an 8% return, but with $12,600 less invested. For the sake of conversation, if I was not to live there, which I would not do, and received $3,200 in rent, $1,600 in expense per 50% rule, the cash on cash return would jump to 52%. This sounds too good to be true to me, please let me know if it is.

By the way, why would I have to wait a year to get 150k with a refinance?