All Forum Posts by: Jeff Brower

Renting out rooms is considered boarder income which is generally not able to be used in your DTI ratio. In essence, you would have to claim the income on your taxes and pay uncle Sam, for no real benefit to your situation. That is at least what I have been told in the past. You may be able to find a lender that would consider that income, but I would verify that first.

I got my license a couple of years ago as a part time thing and to help friends/family/coworkers. I would recommend it. I do a couple of deals a year that help pay for the costs. It is the best thing to have a property pop up that you would like to buy and being able to schedule and go see it right away by yourself. You can essentially have an offer submitted before the general public even see it on Zillow or wherever they are looking.

In most cases, the seller pays all of the realtor fees. Even though this may drive up your end buying price by ~6%, your realtor would cost essentially ~3%. Roll that into a 30 year fixed rate loan, and only put 20% down, then being represented by a professional is pretty small potatoes. Disclosure: I am one.

But the question on being represented by a realtor is completely different from the question you are trying to ask, which is should you buy something turn key or buy something distressed to fix up and gain sweat equity. That all depends on your situation, like mentioned above. You can do either of these with or without a realtor. Most realtors really don't have a clue on the investment numbers to be honest. If you choose to use one, find someone who is an investor themselves and understands that rent minus PITI is not cash flow.

I didn't hear it today but he has always been of the opinion that bigger is better. For someone like him, it makes sense. But a majority of BP are folks who are just getting started and want to get into a few rentals to help offset income and maybe eventually quit their 9-5. We all have to start somewhere. He is alienating some of his viewers by ragging on SFR's and small multis, but he has never been one to be outspoken on his opinion. I have heard him in the past advocate to buy a four unit and move in. I like the guy, its just he is in a different situation than 99% of our little forum. I think most that have had the taste of owning an apartment building would agree with his opinion on going big instead of wasting time on the small stuff. But if you only have the means to go for the small stuff, it is better than sitting on the sidelines!

I work with a couple of folks out of CA doing that exact thing up here near Cleveland. I think finding a good set of boots on the ground is key. Find someone that will go walk prospective properties and send you videos. A good management company can also make or break you after purchase. As far as Cleveland goes, you really have to know the specific areas that are good and bad. I am in Lake County which is about 30 mins to the east of downtown and this is the area that I stick too. Low prices can be alluring, but you get what you pay for. Good luck in your ventures!

I like seeing issues that have been remedied on disclosure forms. It actually gives me a better feeling than if reading a blank form. It gives me a sense of knowing that they are being honest and upfront, vs the curiosity of seeing absolutely nothing listed.  

welcome @Tom Naylor. you have picked a good area. Willoughby, Eastlake, and mentor are my top recommendations in Lake. In Painesville I would only recommend the southern or eastern outskirts, unless directly near lake erie college. I am working with a couple of people currently who are looking for the same thing as you, right now one of my out of state buyers has one in contract in Willoughby. I also frequently view the vacant SFR's on weekends in the area just to stay sharp. I would recommend you have your agent set you up with an auto search on the mls that meets your criteria, and start getting a feel for the homes, areas, conditions, and price points that they are going for.

I see you are from Perry, so you know the announcement was just released about the nuclear plant closing. I would avoid that specific area around the village for that reason unless a great deal came up. 700ish jobs going away in the next few years may have a negative affect, plus taxes will be going up. Let me know if you have any specific questions and I will do my best to answer! 

What kind of engineering do you do? I went to OSU for aviation engineering. 

Local facebook buy/sell/trade groups are a great way to find potential replacements. People can tag their friends that they know are looking. Some ads on my local one have 50 replies/tags within a couple of days.

The real purpose of a 'house hack' is to purchase the property with a low down payment loan due to the fact that you are getting owner occupied financing by moving into one of the units.

In your situation, for a cash out, I don't think it matters whether you are occupying or not, unless you apply for a loan that requires you to owner occupy. Most conventional loans don't but there are some that are less than 20% that do. It really just depends on what product you apply for.