All Forum Posts by: Joshua Christensen

@Rianna Mcgee - The FHA 1 year rule is a myth. There is no written rule saying you have to live there for a year. However, They look at the intention when you buy if you plan on living there. So, if you show a pattern of buying every 6 months, then your intention has shifted. You may need to consider a combination of FHA and Conventional loan programs to accomplish your goals.

Something to consider is looking at living in the FHA for a year and the 2nd house each year being owner financed or something along those lines.

You can mix it up in a lot of different ways.  Once you get into it, you'll start finding nuiances that can help you reach your goals.

FHA has a rehab purchase program that will actually allow you to roll the cost of rehab into the purchase. It's call a 203k loan. So on distressed properties, yes. There are a lot of nuiances, so discuss with a lender in your area that does these types of loans. Also, look at HUD homes. They have a $100 down payment program and I believe it can be used in conjuction with an FHA 203k loan. look up the HUD repo website to find homes in your area. It will tell you if it qualifies.

Conventional loans require 3-5% down and can have some distress, but with limitations.  It still needs to be habitable.  You can move in and do the work as you live there.

The third option is to find sellers with distressed homes who will let you buy on owner financing for 12-24 months while you rehab the place.  Try to put as little down as possible.  These can get creative.  

 Hey @Aaron Freeman,

Great questions.  

1. It's not just in BRRRR that you'll present a lot of offers. It's in any type of investing. Off market deals are best. Get a great Letter of Intent Offer template and utilize it to save you time on your offers. They can be hand delivered, emailed, or mailed direct to the seller.

2. Make offers that make sense.  Accepted offers have to work for both parties.  Our 'lowball' is the cash offer while a 'terms' offer gets them closer to their ask if they'll carry the note for us.  Make offers that a seller will respond to and you'll write fewer offers.  I've actually paid more than their asking price for better terms because the numbers worked.

3. Email, Mail, In Person.  Yes.  Mostly by email these days.  Make it personal and be warm.  Be sure to 'touch' them either in person or by phone.  Email is cold.

4. Every state has different rules.  In NM, our listing brokers have written instructions from their sellers on what they can and can't do.  That is confidential between the broker and the seller, so you won't know.  Check with the broker you're working with on every deal in every state.  

Best wishes to you!  Merry Christmas.

Hey @Cole Booth, getting started is the hardest decision.  Wanting to is not enough.  You're a broker and you help other people make money in real estate, yet you're hesitant yourself.  That's a recipe for some challenges ahead.  When you start betting on YOU and stop worrying so much about hypothetical problems, you'll be better off as an investor and as an agent helping others.  

I did my first deals with other people's money (partners, etc.) then I jumped into a large deal that was over my head.  I borrowed money to get into it and lost it when the deal went south.  Talk about lessons.  In investing, you should be able to take calculated risks to avoid losing money.  That being said, you need to be comfortable with the idea that you may lose what you invest.  Do everything in your power to win every deal, but know that the law of averages is on your side when you do lose on one.  Just do what you can to minimize that.  

When you get confidence in that, then go out and DO IT.  Nothing ever happened in a meeting talking about things.  You have to Do It.  Pull the Trigger.  Do all the homework and risk assessments and pull the trigger.  Even if the first one is not a home run.  Do It!  Roll to the next one.  You will improve over time and the deals will get better.  None of them will ever be perfect.  Let that sink in.  

I agree with @Nicholas L.

Do you currently own your house? Go buy another house and turn your current home into a rental. FHA only requires 3.5% down. Find something that needs some work so you can get a discount on it (built in equity). Fix it. Cash out Refi. Find the next one. I bought my last house on a private note for $500 out of pocket and took over the guy's mortgage. I'm buying another one in a few months for $5k and taking over their note while turning the first one into a rental with good cash flow. Don't make it harder than it needs to be. Just make it work for you.

Consider going direct to seller and working out a Subject To scenario utilizing their underlying note with lower rates.  If you can rehab it in a reasonable time and then refinance it, there's gold in them thar hills.  Finding these deals you're looking for are not going to be on market deals.  You'll need to look at distressed foreclosures with a lot of margin & work needed to accomplish what you're looking for.  Otherwises find sellers with distressed homes that you can do something with them being your "lender".  You set the terms you want.  In markets like this, you have to create your own deals.

Hunter, with no experience and asking the questions you're asking, a start in larger multi-family may be a leap you're not quite ready for.  I suggest you find someone already doing what you want to do and see how you can add value to their team. Learn from them while doing deals with them.  It's a learn while you earn model.  Take a small role and dig in.  In 2-3 years you could be up and running on your own.  There are a lot of moving parts in multifamily.

Hey Ryan. Albuquerque is tough and I appreciate you looking for ways to invest. There are opportunities if you think outside the box a bit. MLS and market deals are going to be priced at market value for owner occupants. I've heard a few strategies that even those houses can be profitable, just not in traditional strategies.

in hot markets you have to think differently to see the opportunity.  I'm in ABQ and would love to grab coffee sometime.

Good morning Matt. Welcome to REI! (I personally would rather be playing ball and REI is the next best thing...lol...Some of the best years of my youth).

I've been investing in ABQ and other areas for several years.  I'm a broker and prop mgr in ABQ as well, so I'm happy to be a resource for you and would love to connect to answer any questions you might have about the market.  A great resource is also on Facebook the ABQREI group where a lot of local investors share ideas.  Dave Torres leads that group.  There are a lot of good resources out here available.  

What kind of advice are you looking for to get started?

As a prop mgr in ABQ, I see rental rates rising and housing is in short supply.  Multiple large employers from multiple industries are employing people who are buying and renting homes.  Supply is currently at 10% of normal healthy capacity.  Estimated 3-5 year run in front of us.