All Forum Posts by: Jaysen Medhurst

@Wendy Carbone, I would not accept. The only exception I can think of would be college-age children living with parents who just don't have credit yet.

@Jay B., for the purposes of analyzing a property I figure the following:
7.5% Maintenance
7.5% CapEx
10% Vacancy
10% Management
+ actuals for PITI

That's why I think your cash flow looks high to me. Sure you may not have CapEx or Vacancy expenses for 3 years, but when they hit, you'll wipe out months of cashflow, if you haven't planned for them. For S&Gs run your numbers with those assumptions and see where they end up.

@Brian Garrett is right, @Anthony Caiola. The more equity you have in a property the worse your ROI. It affects cashflow, of course, but it's even more apparent with appreciation and your Return on Equity (ROE). If you own a $100k property outright and see 3% appreciation, your ROE is...3%. But if you have $20k of equity, then your ROE is 15%.

@Jay B., a better long-term approach may be to sell the properties and roll the proceeds into a small multi-family, 10-15 units. This way you can start taking advantage of economies of scale. How much equity do you think you have all together?

My spidy sense started to tingle at "$500 each in profit," that's a lot and makes me think that either you're not properly accounting for all of your expenses or you have so much equity that your ROI is terrible. Either way, run your numbers again and verify that you're actually putting your money to work in the best way.

@Amy O'Shea, is this something you handle?

@David Hussa, I think you have a few options.

How much equity do you have in the current home? If you could refinance into a conventional mortgage, then another FHA loan shouldn't be a problem. Alternatively, sell this place and roll the cash in to a true investment property.

One thing to keep in mind is by moving out, you may be opening yourself to risks. E.g. right now you have "roommates" and they know it's your place. Once you move out, you essentially have a boardinghouse where the tenants may not be as gentle. Also, some towns have restrictions on the number of unrelated people that can live in one house together.

@Gary L., everyone over the age of 18 on the lease. They must all pass the background / credit / income tests. They should be paying the $30. If they buck, that's a huge red flag.

@Doug Harvey, check out Old Capital

Hi, @Aaron Dyson, I would do some digging at the Building Dept. Most likely, this is not a legal duplex. If it was a legal duplex and then the width requirement changed, it would probably be grandfathered in by the town.

@Tom De Moya, the rates. Vermont Federal is offering 4.375% on 15-year, and 4.875% on 30-year, both with no points. Shop around to local/regional banks and credit unions.

@Khemaro N., if this is purely an investment property (not owner-occupied), you're not going to have much luck getting financing without 20-25% down. Conventional lenders won't take on that kind of risk, and rightly so.

The real question is, where to get the DP? Can you partner with someone that has the capital? Have you asked about owner financing? Is this property a good opportunity to BRRR and use hard money? Can you pull equity from your personal residence, through a HELOC, for example?