All Forum Posts by: Jeff Brower

@Douglas Gratz you are correct, I just happened to get lucky on the timing. If your county does not have a searchable site, then you should be able to go to the zoning/building department in your county and search the list in person. Here is my local auditors site for an example: 

http://www.lake.iviewauditor.com/

@Charles Quentin Pace I would do it again with FHA and pay PMI, even having the funds for conventional. This allows you to keep the other 16.5% (based on 20% down conventional) as cash in your pocket. That can be applied as a down payment toward the next property which should make a better return than what the PMI is costing. I am not worried too much about the PMI, the tenants are paying it.

@Jim Swanson I very much agree with you about that scenario. I was going to mention that but wanted to keep the original post entry level basic. In 5ish years when I have 20% built up the interest rates may very well be high enough to negate the gain I would receive from a refinance into conventional. When I get to that point I will have to weigh the monthly savings, if any, vs the cost of the refi. You're right, even keeping the PMI it is over $100 per door so I am happy. As rent increases over the years through inflation my delta should only increase. A 30 year note is a great hedge against inflation. Thanks for the kind words.

@Bill Goodland The list was not foreclosure, pre-foreclosure, etc. Simply the properties that were zoned 2-4 units. The auditors site has the property address but also the mailing address. I just sent them to the mailing address, 80% were different than the actual property address as you would expect. 

@Inna Los here is an example from my county 

http://www.lake.iviewauditor.com/

It is an online database of all houses in the county with details, tax bills, etc. Our's lets you search and export results in to excel. If you're county doesn't have this, they should have a searchable database available in person at your local zoning or building department. It may be a little more difficult but it if is difficult for you it will also be the same for others, this may give the person who will go the extra mile an advantage. 

@Account Closed I think that including the management fees is essential. People fool themselves into better numbers by not including it because they fall in love with a property, that only hurts in the long run. After 10/15 properties I plan to hire this out so it is definitely good to include the number now. It may take me 10 years but i'll get there. Thanks for the kind words. 

@Account Closed absolutely. There is no real advantage in being an agent besides the fact that you can get by without paying a commission and can view homes yourself. Zillow is a good way to look, but if you are serious you should reach out to an agent who can set you up on an mls auto search email that will alert you immediately when a home pops up that meets your criteria. Zillow will post new homes within a couple of hours of being on the mls, but lags behind in updating when homes go under contract or sell. You could think some are still active when they have been in contract for weeks. 

@Tim Kaminski it was not difficult at all. FHA is a standard loan and is typical for most banks. While I do not recommend this for everyone, I did not do a standard home inspection as I am well versed on what to lookout for. The FHA appraisal is essentially their 'inspection', I wasn't even present for that and it went without a hitch. Any home that is in decent condition and move in ready shouldn't have many issues in that regard.

Start part time. You don't want to burn the bridge prior to investigating the other side. I am doing this right now currently still working my 9-5. I wouldn't recommend quitting your current job until you know you can support yourself through being an agent.

Yes, use market rent for the side you will occupy. Yes, use 3.5% down payment. Don't forget to add in the PMI (0.8).

Here is a link that I use often for fha calcs:

fha mortgage calculator

@Jay Hinrichs @Michael Swan you guys are spot on. I cringe when I see advertisements for houses around here for 30k, duplexes under 50k, etc. I know some of swanny's property areas and he is right about the neighborhood rankings. I have only helped one investor from Cali, he was a realist and purchased a nice SFR down the street from where I lived. It is safe, he is getting a good return, zero repairs to complete, and it is a 20 minute drive to downtown. People do try to chase numbers and end up in war zones, that is not smart. You can still get great returns if you look outside the city just a little bit. Taxes are something that people forget to consider but it definitely bites them. 120k duplexes in Shaker that bring 1k rent each side look great until you consider the 7k tax bill.

Swanny, I haven't talked to you in a while. Hope all is well! I cant agree with your statement more about walkability. If I don't want to live there, I will not consider buying there.