All Forum Posts by: Kevin Phu

I personally would find another agent if they wanted me to pay them for a showing. If you don't feel like searching for one, just contact the listing agent. I'm sure they'd be more than happy to show you the property and possibly even be a dual agent.

I find having a Thrifts Savings Plan (gov't equivalent of 401k) to be very helpful for me. Why?

1-My contributions are tax-deferred

2-My agency matches my contributions up to to 5%. 100% of first 3% and then 50% of the remaining 2%

3-I can take out a TSP loan to use towards a home purchase and since all my contributions are tax deferred, that amount can be built up faster than putting away taxed income.

I don't max out my contribution right now as I like a to make sure that I have a large amount of liquid cash on hand as well.

"VA loan does not require the property to be your primary residence for more than the first 60-90 days after closing."

 The way you worded it means that they buyer does not have to occupy for longer than 60-90 days after closing...which is wrong.

The requirement I stated is that the buyer has to start occupying it within 60 days.

With a new VA loan, you are required to make it or intend to make it your primary residence. You are also required to occupy the property after closing within "reasonable" time which is 60 days.VA Lender handbook chapter 3 section 5.

What source did you get "VA loan does not require the property to be your primary residence for more than the first 60-90 days after closing" from? To my knowledge, the requirement to occupy the property as a primary residence is only removed when doing an IRRRL.

As for the 1 year owner occupancy requirement, though I do not see it specifically state a minimum time in the hand book, I do see majority of people say the 1 year minimum occupancy is written in their loan agreement.

If you refinance your VA loan, does it reinstate the one year primary residence requirement?

I'll get straight down to the nitty gritty. This is going to be a long one so thank you in advanced if you make it to the end. This is a recent property I just cancelled contract on due to seller and I not coming to agreement on repairs/credit. Did I walk away from something that could've worked or did I do the right thing?

Property Info

Purchase Price: 446,500

Location: Ventura County, CA (SoCal)

4 Bedroom/2 Bath

Tile floors throughout except for carpet in bedrooms

Minor kitchen remodel  ~2 years ago

1,193 sq ft/6,0001 sq ft lot

2 car garage-attached

5/10 minute drive to work

T

Loan

VA- 30 years, 0% at 3.625%

PITI: ~2,400/month

VA appraisal came in at 447,000

Plan/Goal

Reduce expenses from renting to save up capital fast to buy properties. House hack this property for a minimum of 1 year to satisfy VA loan requirement.

Rental income from the the 3 bedrooms: ~$2,250 ($750/room includes all utilities; potential for an extra $25 for a garage spot)

While house hacking, save up a down payment to purchase a similar property using an FHA loan.

Expenses

Mortgage: ~2,400

Utilities: ~150

CapEx: 100 (Roof was done in 2012, water heater may last a few more years and is covered by warranty for first 13 months)

Maintenance: 100

Total: 2,750

Current expenses from renting: ~1500

Out of pocket: 500 (equaling 1000 saved per month)

Home Inspection Call Outs

-Main electrical panel does not have main disconnect (national violation) + exposed wiring in garage

-Non fire rated plumbing going through garage firewall for laundry hook ups

-Flat spot on roof that shows signs of standing water

-Entry way is a trip hazard (hard to explain but will post picture below)

-Possible rodent infestation in attic

-Windows in 2 bedrooms violate fire egress code (sill is 4 feet high)

-Closet doors in 2 bedrooms are oversized preventing full access (again hard to explain but will post picture below)

-Backyard sliding door doesn't lock

-1 bathroom shower diverter valve doesn't work (pretty cheap fix)

-Attic insulation insufficient

Repairs/Changes right away that I feel are necessary to make rent ready

-Electrical Panel and exposed wiring

-Closet Doors

-Backyard sliding door

-Rodents

-Shared bathroom vanity to allow storage (currently a pedestal sink)

-Master bathroom shower (for personal comfort. Current shower is one of these neo-corner showers that is smaller than a shower stall on a Navy ship. Been there, done that for 6 years...no thank you.)

Seller only willing to credit $3500 max and no repairs (I only requested for items called out in the home inspection)

Did I do the right thing by walking away from this or should I try to get this contract back?

@Patrick Merone Welcome to the BP family and thank you for your service!

You should be able to go on the county's website and find the tax assessments for a property. As for repair costs, a common recommendation has been to read "The Book on Estimating Rehab Costs" by J Scott. I haven't read it yet but it's on my list. Another way to learn rehab costs, which I have been starting to do, is ask local flippers and also research the costs of certain material on Home Depots website. It's a general idea but a good start in my opinion. 

@Nick G. Still in escrow on the place I told you about! Just adding to my knowledge :) All of your points make great sense, thanks!

@Greg Downey Thanks for sharing your experience! I am in escrow right now on a 4BR SFR which after renting out the 3 bedrooms, it will cover most of the monthly expenses. It's a huge reduction in my previous expense though from when I was renting. So that's a goal met for me. Of course I would love to cash flow on a house hack but with a VA loan and 0% down, I just don't know how feasible it is.

Hey all! So I am looking to use my VA loan for a property to house hack. With all the strict VA guidelines and such, how feasible is it to be able to get a somewhat distressed, more along the lines of very outdated but livable, property with a VA loan?

Has anyone had any success finding an off market property where the seller was willing to comply with the VA loan guidelines such as having to pay for termite inspection and clearance, strict appraisal/inspection, etc...?

Lastly, say I were to find a property off market and I am currently working with an agent for MLS listings, should I bring my agent in to be a dual agent or should I go in without an agent which would, I assume, entice the seller more to sell due to not having to pay commission. Mind you this would be my first purchase but I have looked at the CA RE Associations purchase agreements and such so I am somewhat familiar with that and the process. Just not 100%.

What are the current tax and insurance amounts?