All Forum Posts by: Daniel Kong

You just need to be care of "spreadsheet magic". I see 2% deals advertised every so often. Usually they will be in bad neighborhoods. Be aware, that in these neighborhoods, theres a high chance of your tenants not paying (losing rent for months), having to evict (losing rent and paying for the eviction), having really expensive turnovers (paying $15,000 to repair a badly damaged unit when you only get $600 a month will kill a few years of cashflow), things getting stolen, etc. If you have killer property management company and a good run of luck, its definitely possible for your spreadsheet numbers to work out. Its just good to weigh the risks with the rewards. 

As a buyer, using a real estate agent cost you $0. So you might as well always use one on the buyers side. Even if its just so your friend can get a nice little payday. 

On the seller side, you can always sell FSBO. These are people who are thinking along your lines where they dont see the need for an agent. There are also places you can go to just list your property online on the MLS for a small fee and handle everything yourself. For some people this really is the best option (They are savy enough to know how to market, price, and negotiate on their own. They understand the selling/buying process. Its a sellers market and buyers are lining up). But honestly for like 90% of the population, its worth it to pay the realtor fees.

If it's a conventional loan in your name, that's kind of high. I just closed on a 3.7% 30 year fixed a week ago, with no points needed to buy the rate down. 

Its hard to point you in any direction without knowing a little more about your current situation and goals. What is your current income like? How much do you have saved? What is your risk tolerance? Are you handy and would you work on houses yourself? Do you have a network locally or somewhere out of state? Are you looking for long term cashflow, or immediate income?

What the master @J Scott said lol. What you are describing, I've heard called a "Wholetale". Basically a "good enough" flip to get a little more out of the property. If you get a good enough deal, you could also just sell it "as is" to another investor, in what people refer to as a wholesale without making a single change to it. You'd wanna run different scenarios to see what would make the most sense given your time, money, experience, network, and goals. But to answer your first question, yes, this is totally something you could do. 

Yes. 

lol. 

Yes. Get the W-9. In the beginning is better. Often times, if you don't ask for it up front, contractors will assume they aren't filling it out, and will price their work accordingly. If you ask for it later, that may cause some issues between you and your contractor. Also, it will be impossible to get it after the work is done if during tax time you change your mind and decide you need it. 

Seller Financing is definitely an option. Another is to call around different lenders and see if they would be more lenient on the 2 years of income history. Depending on your situation, there may be lenders willing to take a shorter time frame of income, assuming that there are reasonable circumstances for it (just graduated college, etc). I could be wrong, but I dont think the 2 years is a hard fannie/freddie rule. So if you could find a lender that would be willing to work with you on that. 

It really depends on both the location and also the current condition of the property. There are common daily repairs that need to be fixed (leaky toilet, refrigerator not working), and then there are larger Cap Ex things that will need to be done down the road (new roof, flooring). Try to get a good idea of where your property is in terms of what will be needed in the next year or two for both of those and work the numbers backwards. Its really hard for us to give you a good estimate without walking through your house and also seeing what prices for materials and contractors are in your neighborhood. As a simple rule of thumb, I'd say $100-$200 per month/door might be a reasonable number. 

Great plan! Like others have suggested, try to find a small multifamily (2-4 units). Those would be the easiest to house hack, and most likely have the best potential to cashflow after you move on to your next purchase.