All Forum Posts by: John Oliver Mendoza

Thanks everyone for the response!

@TerryLao

Are you saying that I don't necessarily have to 'rent' it out to my family and that I can just show proof that they have been paying most of the mortgage for that PITI not to count towards my second mortgage?

I already have an agreement with my family to cover most of the expenses regarding mortgage and they really just needed me to put up the downpayment and put the house under my name. If I officially rent out to them I can take advantage of even more tax benefits as a landlord while being able to clear up my DTI with the added rent income. Regardless, I don't see the 'renting to family' as an issue for me because my long term goal is to pay off this house and give it to them outright. It's actually great that they're able to help me pay for a mortgage that's under my name and that I take the tax advantages of (interest deduction, etc). This would also be the only house that I rent out to family, anything else that I will own will definitely be rented out to people I don't know.

I purchased the house October of 2016 and I'm about to reach the 1 year mark of living in the house. Once that happens I can move out of the house, rent it out, and start looking for the duplex that I want to house hack. Does anyone know of great areas in San Diego to own a duplex that is affordable and have a higher chance of cash flowing?

Hello BP community! 

My name is John Oliver Mendoza and I'm a 24 year old software engineer in San Diego looking to get into REI. My family has lived in section-8 housing for the past 12 years and last year I was able to buy my first home to finally get us out of there. I used an FHA with 3.5% down and I've been able to get the rest of my family to cover 85% of the monthly mortgage payment. I actually don't live in the house (no space for me) and I am currently renting somewhere else with my girlfriend, but now I'm trying get a 2-4 unit multifamily to live in and house hack.

My goal is to convert the house I bought last year into a rental and have my family be my "tenants". Doing this will allow me to add that rental income and qualify me for a new mortgage on a multifamily home. I'd really like to get another FHA for this other home, but I don't know if I can qualify for any of the second FHA loan exceptions (bigger family, relocation etc). I will probably look into 5% conventional loans instead if it's possible or more creative financing.

So here are my questions:

Does anyone have any experience converting their primary home into a rental? What is the process? What are the pitfalls? Do I need to set up any business entities yet?

Does anyone have any experience renting out to family members?

Does anyone have any experience qualifying for a second mortgage after renting out their primary home?

Does anyone have any experience finding duplex/triplex/quadplex in the San Diego area?

Bonus:

I'm new here so I would love to network with everyone and know more about the various real estate groups around the San Diego area.

I'm so excited to get into real estate investing and have been listening to the BP podcasts and reading a variety of RE books. Let me know if you have any book recommendations for starting out. =)

Thanks!