All Forum Posts by: Justine Ade

@Julia Kirsten

Hi!

I’m finishing up fellowship here and am planning on doing something similar. Husband has some student loans but we are not making extra payments due to the low interest rate (he refinanced after completing training) so now it makes more sense for us to let the loan run it’s course.

In the mean time we are also getting started with REI - potentially will use either a DR loan or FHA to house hack a duplex (no kids , yet - but the duplexes we are looking into are large enough to raise our first child if we choose) then put 20% on a conventional loan to potentially buy another property.

This is just a tentative plan and something that I think we are both comfortable with. I think the decision to pay off your loans vs taking on more debt for real estate depends on how debt averse you are in addition to what the interest rate is on the loan. Others will think that’s crazy and say you should pay off your loan as quick as possible (not paying the interest is free money after all) but ultimately I think it’s a personal choice.

Feel free to connect if you’d like to chat more ! Love meeting people with similar backgrounds and interests.

Hi everyone,

Trying to figure out a niche. My current plan is to buy a couple of duplexes in a new subdivision carved out by a developer. I want to use an FHA loan for one and a conventional loan for the other.

If I am looking to make a deal before the property is built, how would financing work? Will banks still allow for an FHA loan/conventional loans before the build? Or do I need a construction loan? Also - when is the capital needed? Before the build or do we close after it is built? Are there discounts buying before the property is built vs. the property already being on the market?

Sorry for these basic questions. Most of the discussions around new construction financing pertain to those who actually want to develop and hire builders. In my case, the developer already has a plot of land and floor plans - I just want to buy one of them. 

Any advice is appreciated. 

Hi All, 

I'm in the middle of fleshing out a strategy for our first real estate investment. 

Current plan is to get an FHA loan on one duplex that is newer construction. Because the down payment is so little, even with a renter we would be cash flow negative overall with this one duplex in the first year. However, I'm planning on also getting another duplex nearby with a conventional loan and 20% down which will cash flow positive and cover the cost of the duplex I am getting with an FHA loan.

Two questions. 

1. We were planning on moving out of the duplex after 1-2 years and buying a permanent home. Will lenders still loan us money despite the debt we have from the duplexes above ? Our debt to income ratio even with two high incomes would not be favorable. My husband also does still have student loans that we are purposefully not making extra payments on because of the low interest rate he has on it. We’ve otherwise maxed out all tax favorable accounts, have an emergency fund and we both have excellent credit scores. 

2. We are fortunate to have jobs that earn us higher income but with that, I also want to protect our personal assets. Most people will do this through an LLC but if we form one, we cannot get an FHA loan . Are there other ways to go about protecting personal income ? What would be the pros and cons of getting good umbrella insurance vs. an LLC? Appreciate any advice.