All Forum Posts by: Carrie Smith

Hi All -- 

I'm in a situation where a house went on the market for 145k.  I was under contract at 141k.  There are 12k in repairs needed which includes a major repair of 7k for the remediation and fixing of a water issue in the crawl space.  What would be the max amount you'd offer on this type of property? What is your formula? This is not a fix and flip situation.  This is a buy and hold, and these repairs are all necessary and not cosmetic.

Thanks for your input!

C

Thank you so much.  Yes, I do have to pay for a home appraisal on my own property, so I definitely don't want to pay for 2 appraisals unless I need to in order to do this wisely.  I knew I needed to ask real estate investors... people are not vested in either my purchase of the property or my purchase of a particular service.

Thank you for the information about your cash purchases-- this is really good to know and it helps to ease my mind a bit!

Hi,

So I'm in the process of buying a home (yay - first investment property).  However, the home appraisal will be on my own home because I'm doing a cash-out refi for the loan.  Because I'm buying the property in cash, there is no appraisal required on the home I am buying.  I'm doing a buy and hold situation where I'll be putting tenants in the property, and the numbers do work.

So, my question is this: Should I go ahead and spend an extra $400 to get an appraisal on the home I am purchasing?  My real estate agent says other than for information, it will not be of value.  My lender suggested it, and of course the home appraisor I talked with suggests it also.  What are your experiences, and thoughts?  If the home inspection falls through, I'll be out an extra $400 as well.

Thanks for your advice!

Carrie

@Diana Muresan  Not ALL lenders work with investors.  Some lenders do not do a lot of investment-type loans such as HELOCs, Cash-out Refis, loans for condos or multi-family properties.  Therefore, not ALL lenders work with investors.

Hi,

I'm wondering if anyone here has used CBM Mortgage in the Charlottesville area, and what their experience was? If not, what other lenders have you used that worked with investors? 

Thanks!

Carrie

I'm not sure if I could do with 60% or less LTV because the market inventory is low in the area I'm looking, and the quality of the house tends to be better at higher price points, but I will keep looking.

I will not have a 2nd mortgage, as my primary residence does not have a mortgage on it.  I'm not worried about pleasing the seller so much as I'm concerned with what the best option is for me in the long-term, for my own finances.  I don't want to sacrifice making a seller happy just to be stuck with a complicated financial situation down the line.

It's good to know that investment property only offers 70% LTV back versus my primary residence offering 75-80% LTV possibly. Am I understanding you correctly?

Thanks,

Carrie

Theoretical scenario: 

If I can get 180,000 out of my house for a cash-out refinance to purchase another property, should I pay cash in full for the 2nd property and have the cash-out refi on my primary residence? 

OR

Should I take out a mortgage on the investment property, and us cash-out refi on my primary residence to make the  down payment? 

Right now I'm thinking I should do the 2nd option.  My thinking is that in the worst case scenario, I would still have more equity left in my primary residence should I need it for an emergency situation beyond my normal emergency reserves, and it would be a safer option overall.  If I didn't use the 2nd option, I wouldn't have any equity to draw from my primary residence - but would I be able to draw the equity out of the investment property if I paid cash for it?

What are the pros and cons of each? Do I have to pay closing costs twice? I'm guessing the answer is yes, but hopefully it's in relation to the size of the loan in each case.

Experienced investors - what is your opinion?

C

Hi,

I'm wondering if anyone has experience with Cash-Out Refi or HELOCs to invest in a 2nd home? I was told that a cash-out refi could potentially be better because they have lower rates and have set payments from month to month. Also, how do I know how much house I can afford if I do a conventional loan plus a cash-out refi or a HELOC in conjunction with it? Any examples or experiences with this is helpful!

Thanks,

Carrie

I'm in Charlottesville as well with similar goals - would love to meet up to chat about our goals!

@Kristopher Hanks Thank you.  I'm dedicating time to it each day to learn a little bit more!