All Forum Posts by: Kenneth Garrett

@Jake Miller

Yes, you can buy in multiple locations a vacation home. You can't use the vacation mortgage twice in the same area. You could buy in Destin Florida and then in Gulf Shores Alabama. They have to be in different markets. You'll need to check with your lender. When I bought mine I was not able to rent it with a lease (30 days or more). STR is ok. You are suppose to use it at lease 14 days a year. I don't think it's enforced very strictly. Read your documents thoroughly and be up front about it.

@Robert N.

Lenders are quirky especially in times of uncertainty. I use small local banks in my area to do my refi's. They are much easier to work with then the big banks. DTI is not a factor with commercial lending. They care about DSCR of 1.25 or better. The higher the better. I just refinanced at 70% 20 year Amortization at 4.75%.

@Steven Gray

Be carefull of opening new credit accounts while you are going through your loan approval.  That will cause a problem.  Wait till after you close.  I used credit cards to furnish my beach house.  I didn’t want to dip into my savings and the opps account (things I didn’t account for or surprises).  I’ll have it all paid back in 6 months.  If i were not to be able to pay it back in a short time frame I would look for other options as already stated.

Good Luck.

@Rohit Sharma

When I got my loan a few months ago I had a restriction that limited me to leasing the property for more than 30 days to a renter. As the 2nd home loan is designed for you to use it at least 14 days a year. This is why STR is such a great strategy for a vacation home. Not sure that they police it very diligently. One of those don't ask don't tell.

@Justin Manges

This is my first year in the Destin area.  Started renting to guests in March.  I was fortunate to hit the spring break crowd.  I’m almost at 50% occupancy already with the bookings.  Projection wise, I think I’ll hit between 70%-80%. I based all my numbers on 50% just to be conservative. 

Good Luck.

I agree with @Anna Laud I buy refrigerators with no water, no ice makers, top freezer, just a plain fridge.  I usually buy Frigidaire.  They work fine.  You can buy used ones at a pretty good discount, but they might only last 5 years.  I prefer the less expensive new ones.

@Juan Sanchez

Have you received any notices prior to the summons.  In order to receive a summons there typically are violation notices that have been sent previously.  

@Marissa Liesenfelt

I took a different approach then most. I bought my STR in the Destin Florida area and live 1000 miles away. I spent three weeks there painting and light rehab. I didn't have enough time to look at used furniture. I was ok spending a higher amount to furnish it to save time. I wanted to wow people with the finishings. I spent 20K. I'll have it all back the first year. The response from guests has been outstanding. Most comment on how clean it is and love the way it is furnished.

I was fortunate that I hit the spring break crowd.  The first 5 weeks were booked pretty quickly.  Things are going better then expected.  I calculated my numbers based on 50% occupancy.  I’ll probably end up around 80%.

@Romi Gaddy

When using the BRRRR method after you refinance you should have enough equity in the deal to pay back your investor. Buy it for 100K, rehab 25K, ARV 180K - 75% LTV gets you 135K. Should be enough to pay back your investor. Even if you had a few thousand stuck in, use the cash flow to get all your money back. Above all pay back your investor even if it means pulling money out of your pocket.

@Charity Johns

I would be looking for an experienced partner.  When you don’t have much or any experience you need to build yourself around a team.  After you have a couple of deals under your built then you can do things on your own.  I would want to know what deals you have done in the past and what the outcome of those were.  Projected and actual outcomes.  Any challenges you encountered and what did you do to resolve the issue or issues.