All Forum Posts by: Jerome K.

There are some rare and complex circumstances where I see this would be beneficial. You could theoretically structure a deal where you are cash flowing negative, but have an overall positive ROI. This would need to be structured that if your rent is at or below your mortgage payment, the portion of the mortgage payment going towards principal is more than all other expenses (and hopefully more than budgeted capex).

There might be some added tax benefits for this if you add in depreciation to help push you to a lower tax bracket. 

That in mind, I wouldn't chase these deals, especially if you are in "growth mode". 

I've always stayed clear of 55+ communities because of (1) the restrictions for potential tenants, and (2) the potential resale value of the property. From my experience, 55+ communities do not appreciate at the same level as a non-restricted community. And the added aggravation of dealing with other HOA compliance pieces associated with age restriction doesn't seem to be worth it, in my opinion. But, if you take everything into consideration...if the numbers work, the numbers work.

I'd stay with the 30 year fixed (less variables and more predictable for future costs).  But I'm sure you'll get different answers depending on who you ask.

Just looking at your numbers, it seems kind of light to me. Vacancy budget 3%, and no management fees (assuming self management); and you're cash flowing less than $150 a month. Also, how accurate is the HOA fee? Condos I'm familiar with would be almost twice that.

 I am pretty sure you don't "NEED" a business certificate to take these deductions.  Local governments may require them to operate a rental unit, but from a tax standpoint, there is no paperwork to file for a sole proprietorship.

I have used Quicken Loans (through a third party mortgage broker) on multiple deals.  I dealt with my broker directly, so couldn't really say much as far as Quicken Loans, but I haven't had any complaints with the underwriting process, or servicing of the loans.  Their online portal for payments and account information is extremely easy to use.

I use quickbooks.  It has some pretty strong reporting capabilities.  You can assign each property as a class, and then run P&Ls by class to drill-down into all those details.

There is another thread with heavy posting and debate.  I think the math clearly shows all you are doing is replacing one debt for another (and the HELOCs are usually variable interest rates and higher rates).  This doesn't come out to be beneficial.  Here's the thread:

https://www.biggerpockets.com/forums/49/topics/329...

Not for nothing, but could you title your posts that doesn't sound like a buzzfeed clickbait article?

Sounds like this would fall under "self-help eviction", but I'm not a lawyer.