All Forum Posts by: Christian Allen

@Akeim Fin I was told the same thing when I was looking to use a FHA loan for my second property. I went to a different smaller bank and they didn't even bat an eye at the fact that I was moving in the same city just after a year of buying a three family. Smaller banks will have less strict underwriting rules in my experience. PM me if you'd like to try the bank that gave me the FHA loan for the second.

Typically the high LTV HELOC and HEL only apply to owner occupied since you have more skin in the game to pay it back. The bank is taking a serious risk going second position for the remainder of the value, a slight market change would put them underwater. You're more likely to stick with the house if you live there as opposed to it being an investment property.

Navigant Credit Union will do 95% LTV for a HEL not HELOC. I don't know of any banks that will do much more than 80-85% for a HELOC. Especially on a 3 family.

https://www.navigantcu.org/personal/lending/home-loans

Similar to what @Mark Taliercio said, it depends what your goals and what the ROI of the property is. It will also depend on your proforma and how conservative you were when creating it. Remember that students are typically tougher on a property than other tenant groups and you need to factor that into your capex/maintenance budget. That $200/month can easily be wiped out with some expensive repairs due to hard partying or just lack of concern for the condition of the property.

@Allen McGlashing Yes I was able to get another low down payment FHA loan. I actually ended up doing a 203k FHA loan. As long as you do not have a FHA loan at the time you should be qualified to get one. As far as the interest rate, I went from 3.625% with PMI to 4.5% without. Ended up being the same payment but well worth it since it allowed me to purchase another house hack property.

@Allen McGlashing I was successful in finding a lender who would use 75% of my gross income based on current leases. The important part for me was being able to refinance out of my current FHA with 25% equity to convert it into a investor loan since it was a 3 family. The lender had no problem doing another FHA just after the 12 months. My advice would be to search around for local banks. They are more familiar with the area and may have more confidence writing the loan using current leases.

@John Gentile welcome to the East Side market, returns can be pretty thin especially for a "turnkey" property.  I live not too far from that property on the east side of Hope Street.  My two cents would be this. 

1. It is in a neighborhood called "Mount Hope" which is on the rise historically but compared to the rest of the East Side is usually the least desirable in my experience.  Doesn't mean it's not a good area but the students typically are aware of the best places for apartments so you would be less likely to get the higher dollar Brown student rent.  

2. Since the units are only 900 sq ft, $1200/month may be a little bit of a stretch based on comparables in that neighborhood.  Not saying it's not possible but I would base your numbers on that being on the mid-higher end.   

Luckily properties in that neighborhood have lower tax valuations so you save a little bit there.  

Barclays Online Savings account has a current rate of 1.40%.  Almost enough to keep up with inflation.  

Hey @Jacob A. I've got a few multis in Providence and could help give some feedback on any of the neighborhoods you might have questions about.  

The PC area is a good market for student rentals.  The students are pretty aware of the good and bad streets so not everything in the area will attract the most students.  Smith Street is a little hit and miss but for the most part the area that passes through Elmhurst is not too bad.  The Elmhurst neighborhood in general is good but usually a limited supply of discounted multis due to a high owner occupied rate compared to other parts of the city.  

Providence has a broad range of tenant classes so depending on your investment strategy there is a lot to choose from.  Feel free to PM me if you have any questions.  I've lived in a few parts of the city over the last 4 years.  

@Jennifer S. my tenants on Fed Hill all stay within Providence.  I have a mix of grad students and recent grads working at the hospitals/downtown.