All Forum Posts by: Chris Stromdahl

@Shawn Thom 

Thank you for the clarification.

@Lamar Dixon 

I do not flip houses, and thus am not an expert, but it seems to me that if you are confident that you can buy, rehab and flip the property using the HELOC funds, then why not?

I do not see any advantage to taking out a loan if you have the funds.

Thanks, Chris

@Aaron B. 

As far as 10% vs 15% X% return, it all depends on the market and really what you are comfortable with. I posted a Success Story on my first B/H recently, some people were supportive, some people said it was a deal that they would not have done. But, I did the research, made a decision and am comfortable with it and that is what matters at the end of the day.

As far as this deal goes, I punched your numbers into my property analyzer spreadsheet and it looks to me like you would be generating $175/door per month and that is before any taxes are taken into consideration for the long term. That is not a real strong return for having to invest $60K. That is 10% Cash/Cash and 7% Cap Rate. They say you can get 8% return in the stock market. Also, those returns are based on 0% for property management. One thing that I learned early on is to by a property with the expectation to hire a property manager some day. Otherwise you are buying a job. 

Furthermore, my analysis only includes $600 for property insurance, PMI and repairs and maintenance. I can only assume that those numbers are below what you will actually have to pay.

Maybe I am missing something, but that is my two cents.

Thanks, Chris

I am looking to paint our rental this summer.

It really does need it, was pointed out by the inspector. I figure the investment early on will save me headaches in the future.

• Any thoughts on this?
• Any suggested paint brands?
• What questions should I ask the contractor/things that I should think about?
• Approximate cost for an 1100sf, two story, SF?

Thanks, Chris

@Brian Eastman @Dmitriy Fomichenko @Lydia Simeon 

I apologize. Brian, you are correct. I was using the IRA and 401K synonymously.

Thank you for correcting me.

@Marcia Maynard 

That is where my mind went as well. As a result of this visit, my wife started doing some research. It turns out that Pierce County has a 37 page list of houses that are associated with meth manufacturing/use. That is a lot of houses.

@Bryan R. 

Awesome. Thanks for the link.

@Dmitriy Fomichenko 

With regards to the use of borrowing against your IRA:

I am 100% sure borrowing against my IRA through my current IRA vendor is an option without penalty.

What I am not 100% sure about is whether it can be used for investment property or, if it can be used for investment property, whether it would be in the investor's best interest to use it in that manner. 

As I said, it is something I have investigated to a point that I know it may be an option for me and that I will verify once I get to that point in my business plan. Others who are looking to use these monies for real estate investment purposes should make the same phone calls I did and get up to date information specific to their situation.

A self directed IRA/checkbook IRA is not something that interests me, but this may be.

@Scott Pigman @Mitch Coluzzi @Sylvia B. 

Enough said. Thank you very much for the input.

We are not moving forward with this deal, but I noticed when I searched "crystal meth" on the forums I did not find anything. I wanted to ask for myself and anyone else that has the question in the future.

Appreciate it.

@Jeremy Fields 

What is DOM?

I am a new investor. One thing I have learned is that betting on appreciation is speculative, high risk and does not fit my investment strategy. I like to stick to the mind set that I don't care if the property is worth $1 or $100K as long as it cash flows.

@Lydia Simeon 

I investigated the use of SDIRA's pretty extensively over the past couple of months.

From what I found out, unless you have a substantial amount of money available in your IRA, the math does not pan out very well in your favor.

If you private message me, I will refer you to reputable company/contact point that I spoke with. They were referred to me by another reputable BP community member.

I have not moved forward in leveraging this, but in my research what I discovered was that my IRA vendor will allow me borrow against my IRA up to 70% of what I have saved at 5.2% interest. This is paid back to my IRA including the interest earned and is directly debited from my paycheck.

If option #2 makes sense, it is just a matter of calling your IRA vendor and having the discussion with them. Make sure your verify that there are no restrictions on what the money can be used for.

Side note: I assume that taking money from your IRA does reduce the monies in your asset column. If you plan on using a conventional loan, this will reduce the non-liquid monies you have as collateral to support the loan. I am not a financial planner, and this is not legal advice, but it makes sense.