All Forum Posts by: Craig Jeppesen

Banks are going to go off of fico, down payment and debt to income ratio. You have the credit and the down pmt but you have no income. If you wait until you finish school and secure a good job, they will go off your new job income. The highest dti ratio is 45% for a conventional mortgage. If you secure a job with a $60 k salary or $5 k a month you can have up to $2250 in monthly debt pmts including the new mtg. If you have $600 k you can always pay cash and refinance later to get some of the funds back.

Yes fha and you can get more than one.

It is one of the cheapest and easiest ways to start as a re investor as you can put less money down on a loan. You buy a duplex (other multi family), finance it with traditional non investor financing and live in one of the units. By living in the property, you can get in for 3.5% down pmt financing vs 20-25% down. You live for free, and scale by purchasing a new multi family and moving to the new property and be owner occupied each time. You have to stay for at least a year and save up another 3.5% down pmt before you purchase the next live in property.

4 reasons and I don’t see it getting better anytime soon.

We have an overall housing shortage caused by the last market crash due to fraud in the market. 

The economy is doing very well and there is a lot of money chasing returns and doing anything to beat inflation.

Foreign investors are buying up places and having them sit empty hoping for appreciation I guess.

Social media (Bigger Pockets included) has made it so way more re investors are in the market, it looks easy and people really don’t know what they are doing but social media makes it look easier than it is And they don’t do their due diligence.

Get the 30 year mortgage and use cashflow to snowball mortgages. Use your own funds to make extra payments like a 401k. For example let’s say you have $25k and a $500 a month surplus in your budget. Purchase a brrr with an arv of $100k being all in at $75k. Fix, it rent it and refi. Use your $500 a month plus a match from your cashflow from the rental to pay it down and use the $same $25 k to buy another brrr and put extra cashflow on first prop mtg. By year 4 or five you should have the first property paid for and have 4 or 5 additional properties. Now you have more cashflow to dump at the second prop mtg and that one should be paid for in 3 more years. After a while you should have enough cashflow to pay off a property in a year or two. You should have 10 or so paid for properties by year 15 and will be a millionaire, with appreciation and plenty of cashflow to retire. 

Heloc

Construction loan

Commercial loc

Private lender

HML

Sometimes traditional conventional mtg

 I think that is a great idea as well. I would do this but my wife would never want anyone living in our basement.  If your wife is on board go for it. Set aside $25-$30k to finish the basement. It sounds  like you will get that back in just a couple years of rent.  That is a great return.

Me personally would payoff the rental, keep $20 k for a down payment in case a good property comes up and put the rest on the primary. I would then get a no fee 10 year loan on the primary and add a heloc for if a property comes up. I would then use the $2 k in cashflow to pay off your 10 year loan in 6 and then do a new heloc and use your now $4kish cashflow and heloc to buy more properties and repeat.

Using your numbers you can have about $1400-$1500 in total monthly payments with your income. A bank will likely count your rental income differently than the $1 k so it might be different. Why are you quitting your job? My guess is no you can’t finance a property if you quit, unless you get another job. If you are really wanting to grow the best way is to use w2 income to save for down pmts. Also you have a wife and probably kids to support so keep that job  for a while.

At least do enough to get the full match in the 401k. Do Roth and only stocks, not bonds and money markets. Use the rest of your disposable income to save up for properties. Maintain your standard of living and each raise put entirely into the 401k until you max out. Keep saving for down payments using the rest of your disposable income and cashflow from properties.