All Forum Posts by: Josh Edelman

 Ok Josh, understand what I am advising from has a basis in 2 different foundation points. The first is market cycles, the second is investor psychology. 

I would say you need to pay-off that heloc, full-stop. Not interrelated to a purchase, just pay that off. Because think, that was your down payment on a property. You borrowed that down, so you must have that as priority #1 of paying for that down. A down is supposed to be cash in hand. 

I get what your thinking, but this is not the market cycle for that. Your looking at using maximum leverage, and this is NOT the time for maximum leverage, it is time for being DE-leveraged. 

And on the investor psychology side of things, you gotta keep in mind that down $, that's cash-in-hand. $ used to secure a property, and borrowing for it is "cheating". So, you need to feel a kind of anxiety associated with that, and a burning desire to get that paid and cleared ASAP. 

When one thinks like this, it helps align the mind to keep a focus on proper production of property. It put's you in a mindset to keep driving at delivering cash-flow, in general. 

We are in STAGFLATION tail-spin, with powers that be pressing for recession to prevent stagflation. Many bad things can result from such for the heavily leveraged person. My #2 money-maker in last tight economic cycle, was buying out failed investors. All of them had same story, the leveraged tight as a nats-azz, and then something happened, something they did not have a buffer to fall back upon, and next thing there deep in the red with no way to turn. Don't be that guy. 

Todays market is about VERY smart acquisition, with ample margins, contingency funds, contingency for contingency. 

I know your licking those chops at #3, but what's most important is to keep going vs pumping unit count to just loose it all, or any, right. 

The #'s are clear, you gotta take a step back, clear that borrowed down $. Now your way better set to convert mortgages when do AND have a contingency fund when/if need in the interim. 

Keep in mind, cash in hand is dyeing at about 8% right now (inflation). Paying off heloc removes that interest charge AND loss of $ via inflation. So if heloc is say 6%, that's a 14% saving your affecting. Because Real Estate moves with inflation, right, so $ in real estate is at net 0 to inflation. That's 0 vs -8. So paying off heloc should be viewed as a 14% ROI. That's smart $, is it not.

So take it in smart steps. Stop thinking about #3, think about stabilizing what you got, to be best set to jump on #3. 

Is the $1,100 difference from wrapping the heloc in and new conventional rate? 

If you have that heloc with a balance, your not ready for the next one. You need to clear that acquisition $. 

@Josh Edelman

Hi Josh, I am an agent in Cincinnati, OH and I think Cincinnati has what you need! Cash flow AND appreciation, low purchase price, etc. Let me know what you think, I would love to answer any question you may have!

Refi #1 into a conventional. Yes, rates are higher BUT given you have a strong equity position, that should help mitigate that rate a touch. And it unlocks VA for #3.

What rates have you been seeing on your DSCR quotes? The market has been quite volatile and if you are putting 25% down then if your credit is solid a lot of deals are cash flowing again on DSCR, especially if you pick the right market

How much equity do you have in the current properties?

@Josh Edelman

Do you have a wife and/or kids? If not, another owner occupied property is probably the easiest and least expensive way to get a 3rd property. It needs to be a a good investment property to buy and hold i.e it will appreciate and cash flow when you move out and rent.

This is up to you and what your investment goals are. If lending is your constraint there are DSCR loans that will allow you to take as many loans as you want as long as the property cash flows. Hoping to use your VA loan for investment property will handicap you.

@Josh Edelman congrats on your first two!  I’m in Las Vegas right now and could tell you all about Rochester for your third!

I don’t care to gamble. Funny thing, I was just telling someone, why gamble when I can win 90% of the time with real estate? (And it’s really higher than that.)