All Forum Posts by: Corey W.

@Geet Doshi

You can normally find estimates for the area on google or by calling the companies directly to ask. Sometimes they can be helpful where as others not so much, it all depends who you get. For instance I'm purchasing a property in a town that has garbage pickup included in the taxes. The rest i estimated based of my past usage with extra and the use of my realtor that knows the area very well. 

I would also suggest looking into the 50% rule. It is a quick screener that can be used to determine if a property can be successfull as it stands. 

They have numerous detailed property analyzing spreadsheets on BP. If you PM me with your email, once I get home later, I will send you a sample of what I use. 

As well if you haven't already, i would suggest finding a mortgage broker who can preapprove you. That way you'll know how much you can spend for sure and they would be able to give you estimates for the monthly payments and downpayment with closing costs. If your interested I can send you two of my brokers information. Having the preapproval helps tremendously when you end up finding a property that fits your needs and budget.

*Edit- Is this the first property your looking at? 

Hi Geet,

What are the remaining bills that you will be paying each month for the property and what do the tenants pay for? Ex; taxes, water, sewer, garbage, HOA fees(if applicable), insurance, is it in a flood zone, is gas separate, is electric separate?

Also be sure to remember you will need more than the 3.5% down for FHA loans, your closing costs will be a lot higher than a conventional loan due to extra escrows needed upfront. Assume 5% closing costs for FHA with 3.5% down. So if the property is $300,000, you'll need an additional $15,000. Bringing the total amount upfront needed to $26,200. Plus you'll want to have a few months expenses on hand for any issues that may arise or repairs needed.

As well your monthly mortgage may differ than $2,500. Due to interest rate, property price, PMI, etc. For every property you find, I suggest you do a detailed analysis of all bills, costs, and income. That way it can lay out COC, cash flow, cap rates. I suggest you do this for 50-100 properties in the area if you haven't done so already. After doing this you'll be able to spot a better deal and make an informed decision with as many details as possible.

 This is what I'll have to do in the future if the lenders deny my application due to the letter. I normally transfer money into my account and did not realize this was going to be an issue so the most recent transfers were done at the beginning of this month, which would mean the earliest I can go under contract again is July or August if I don't transfer any more money over. My business accounts do still show "reserves" and almost no money is used as working capital. But the lenders don't know this, and don't accept my word as for what I use on expenses. Neither did they want any other quarter P & L Statements. 

Thank you for the advice, next time I'll see if they can accept one months statements instead or I'll wait longer for the seasoning.

 Thank you for the input, I do have two other lenders on tap and I sent the next best one my paperwork. I was trying to see if there's any other way, just in case these lenders require the same letter.

Unfortunately I don't have that much to put down at the moment. My lease is up at the end of June and things kind of just lined up for me to buy until now. If I could have I would've liked to put down more to avoid the PMI and not having the requirement of living there.

I just did a quite google search to find this PDF from NJ state's website,

http://www.state.nj.us/dca/divisions/codes/publica...

Section 46:8-50 states flood zone and notifying tenants. It seems you do need to notify renters if the term is longer than one month. If the potential tenants did not sign the lease yet, it seems you could add it into the lease as an acknowledgement and have them initial next to the paragraph. 

Or if they have already signed, just draw up a separate document stating that the property is in a flood zone and this document acknowledges you letting the tenants know.

I'm in the process of purchasing my first duplex. This is one I'll be "house hacking" so I applied for an FHA loan and made an offer on a property. However my lender is now requiring a comfort letter from a CPA. My regular CPA did not want anything to do with this, so I've reached out to 3 other CPA's who either did not get back to me or had an excuse saying "they were busy". It seems no CPA wants to touch it, the lender even offered my CPA a letter of no liability if they were to write the comfort letter. Or even that the comfort letter would only be used as an opinion and could not be used for any legal kickback, issues, etc.

I'm self employed and essentially I run my own business. I already gave my lender Q1 P & L statements, all my bank statements and 2014-2015 tax returns. But he is saying because I've transferred money from my business accounts to my personal accounts within the last 60 days, there is no other way to get the loan. Essentially those transfers were like my business paying myself.

Has anyone encountered this or have any advice that may be able to help me get the loan?

I appreciate any advice, I'm not quite sure where to go from here unless I pass this deal, let my personal accounts "season" for 60 days, then try to purchase another property.

If the tenant does have a lease, it will be harder to evict them, especially if they're paying. I think your best bet would be cash for keys.

You could offer more the quicker they move out. Ex if they move out within 1 week they'll get $1000. 3 weeks will be $500. 

I would set it up market rates or slighty above for rentals in your area so that its more incentive for the tenant to move sooner for a bigger payday. 

I'm in the process of buying a 2 family house with both units rented. I attempted to put in the contract to get one of the tenants notice once i secured financing, but the seller was very hesitant and denied. I understand on their end, if the deal was to fall through then they would have an empty unit. However both leases were up this month then transition into month to month.

As for their security deposits, my attorney made sure to put it in the contract that at closing, they are to transfer the deposits to me. So once your under contract, your attorney can throw that in the contract.

Sorry there is any typos or bad formatting, I'm on my phone.

Welcome to BP. Just like you guys, i sprend a lot of time driving the tristate area. What I did was download beyondpod on my phone to easily listen to all of the podcasts, it's made my time driving much better.