All Forum Posts by: Jason L.

I am paying utilities for both (it's under 1 meter so there was no way to split it off between the tenants. We just included an upcharge in the rent and then I pay it myself). Expenses are taxes 2300, insurance 1000, ~3k property management, utilities ~1800 = 8100. Is that really that high? What do you think it should've been closer to?

 The 2 sides gross $2150/mo. After fixed expenses, the house makes about $850 net cash flow BEFORE maintenance or vacancy (so maybe 600ish after giving a future allowance). So if I go from 650 to $1000/mo on a mortgage, I'm down to about $500 before allowances/$250 with it (even if you said that another $150 of that is going to principal, that doesn't exactly solve my problem of having too much cash still locked away in the house). It still cash flows, but I'm one or two rent drops away from needing to consider selling. Not to mention that all of my cash flow for the first 48 months essentially is paying the closing costs alone. I feel like I'm missing something here because there's just no way refinancing can be such a total negative, right?

I suppose a simple answer to that might be that it's just not the right time. I might consider another year or so on the current terms, get more of my own money out at the faster rate, and then refi to pay off my current loan when I have less of my own money still invested. It's a conservative approach, but it would still work very well in the near term for the cash flow.

 Yeah, I'm not questioning the rates. I'm more curious how fellow investors like yourself are making such high payments tenable? To refi basically takes me from having a property that I'm currently loving the returns on to one where I'm one rent drop away from probably looking to sell. Maybe my expectations for monthly cash flow are just too high compared to reality, but I'd be curious how other investors are managing their risk with such high payments on a refi?

 I'm just always reading stories on here of people refinancing for under 5%, so when I heard 5.75 it was pretty jarring. I am just not sure how others have made that feasible (in the majority of instances, at least). I'd love to reinvest all the money I have in there, but it would cut my pro forma cash flow by 2/3 and give me almost no buffer if I needed to drop rents at any point over the life of the mortgage. Yet I know others are somehow making this work. 

Anyway, that's my line for the initial question. At worst, I could just not refinance and just keep pulling money out of the house that way instead.

I'm looking to refinance a duplex I have in Saint Petersburg, Florida. I bought the house for $170k using an interest only private loan (I pay $650 in interest per month), and then I put an additional $30k of my own money into renovations. I would guess the house will probably be valued now in the $230k range. I'm obviously trying to refinance the $170k that I owe (around 73% LTV on $230k), and then use the private loan to go buy another in cash.

I spoke to a lender who told me that because the house is a duplex and not a primary residence, the best rate I could get on a refi will be around 5.75% on a 30-year fixed. That would put my monthly payment around $1000, which would essentially kill my margin on this duplex. So my monthly payment is going up over 50%, I'm taking none of my own money out, and I have to pay a few thousand in closing costs to boot. This is obviously untenable.

Is this really what I should expect on a refi? How has everybody else been able to make situations like this work?

For years I owned one self-managed property that I was easily able to do the bookkeeping on with Excel. However, I recently bought two more units that are under professional management. The PM company gave me an owner's portal on their Buildium site, but I am running out of steam trying to constantly update it on my Excel sheet. I'd love to invest in an accounting software that could read the statements from Buildium but then also allow me to input the transactions from my self-managed property. Does anybody know of a software that can read off Buildium (Quickbooks)? If not, then how do you handle it?

People get way too tied up with "rules" and buzzwords ("does my property BRRR!??!") around here. If it looks like a rose and it smells like one too, then chances are that it's a rose. While opportunity costs can be a separate discussion, if you have a bird in the hand that hits all your specs, then it'd be silly to pass on it because of a pseudo-rule that someone else created.

I bought a house with a flat roof.  The house was 1100 SF, yet the bids to replace the roof were routinely in the range of $9 - 13k.  For reference, I had a normally-pitched roof on a 1400 SF house replaced this year for $6800. So the retail cost of a roof replacement was nearly twice as much per SF on a flat roof as it was on a normally-sloped roof.

The big risk, as others have pointed out, is that water will pool on the roof instead of sliding off. So realistically you'd want to redo the flat roof with a slight pitch so that it will last longer.

My favorite bad wholesaler trope is when they try to sell you a property, but then when you Google the address you see it on the MLS pending for like 20% less than what the wholesaler was asking for.

A guy and girl applied for a SFH I had (call them John and Jane). I Google searched John and saw that he had been arrested 4 months earlier for his part in some public bar fight. I had to ask him about the arrest to satiate my curiosity. His story was essentially, "Some dude was hitting on my girl so I kicked his a**."

Long-story short, "his girl" who he got arrested for in the story was not Jane, the girl he was applying for the house with. I also certainly got the impression that he had told Jane the arrest was for something else (or did not tell her at all) because he politely asked me to not say anything to her. So basically this hothead who gets into bar fights for trivial reasons not only wanted to rent the house from me with his girlfriend, but he also wanted me to stay hush to her about what I am assuming was his side chick.