All Forum Posts by: Clayton Plank

@Brad Young, that is a great way to allow you to step into the real estate investment world. I used a HELOC to purchase my first rental property. A HELOC is nice as you don't pay for the money if it is not in use. I would use it to purchase the property. Then I would fix it up and then refinance it. I would then pay the HELOC off and wait for the next property and repeat.

@Evan Cruz, there are several ways of investing. Are you talking about bank loans or all loans? You could look at owner financing. Maybe partner with someone to make your money go farther. Wholesaling is also an option that doesn't require a lot of money. Start listening to the podcasts and webinars that are offered by biggerpockets.

@Ralphy Rosado adding the insurance and taxes into the mortgage would be a lot of work for you as you would have to deal with setting up and maintaining an escrow account. The owner financing deal I have done they were never included. Require yourself to be listed as additional insured as the mortgage holder on the insurance. The insurance company will send you notices if the policy goes unpaid or she attempts to change it and lower the coverage. The taxes are something you need to verify they are paid every year. I would really get with a real estate attorney and have him do the mortgage paperwork for you so you are covered. \

The interest rate is what ever you both agree to. She will be presented this number up front and if she doesn't agree to the interest rate you want then that is were you have to negotiate back and forth until you both agree to everything. 

@Justin Charpentier I do not specialize in flips. I do like to find buy and hold properties that need extensive work for large discounts and rehab them with a buy and hold mindset. This allows me to get into a property at lower cost and allows me to rehab it in ways that benefit me for holding it long term as a rental.

You make your money on the purchase. Plan for the worst in every deal. You are ahead of the game if your already have private money lined up.

@Alexander Zurn that is a good strategy. This will also benefit you if you find yourself in court as you can show the court you gave them extra time to make the adjustments and to look elsewhere for residence.

@James Lott instead of a cash out refi have her look at a HELOC. You don't have to pay on the money when you are not using it. She could use it to buy that first property. Fix it up and do the BRRR method. Pay the HELOC back and then use it again for the next property. Then continue to wash a repeat.

@Jeremy Griggs I agree with Mark. You are going to have a fun time playing judge Judy with your tenants. You will also have to think of your tenants having guests. Are you going to put secure locks on each tenant's room? I'm not saying it can't be done as I did it with my first primary home but it did not last long as it was a nightmare for me.

@Alexander Zurn you are not kicking them out you are managing your new investment. The guy that tried scaring you more than likely was trying to do so as they know they pay below market rents and they do not want someone coming in and actively managing the units. As long as you stay within the legal statues and guide lines you will not have to worry. I see it all the time where people are perfectly healthy until that eviction summons shows up. Then they play a said story to a judge trying to stay or get the eviction thrown out. Make sure your ducks are in a row when the time comes and remember this is an investment.

@Pierre Toussaint looks like a good start. The number one thing I see that stops new investors if the failure to act. Take you plan and put it into action. Good Luck Sir.

@Cassidy Hamilton look for owner financing. Older landlords that are looking to get out of the game. I have found owner financing tend to benefit both the buyer and seller. Allows the seller to not jump through the bank hoops and maybe less down than an investor bank loan. Helps the seller as they make money off the interest and they do not have a large lump sum of income in one year. You can add a balloon in the mortgage at 5 or 10 years if they wish to not hold paper for a long period of time.