All Forum Posts by: Account Closed

@Russell Brazil Yeah I'm thinking the same thing. Thanks!

@Dennis M. How do I avoid the bank? I'd be saving up money for 60 years if I had to buy even a distressed home with all cash. Even saving for 20% of something in my area would take me years

So then my next question is, how much time does one have to move in? Could you rehab and then move in, or do you have to be there within a narrow time after closing?

@Chris Mason Thanks! Yeah good point Haha. I wasn't planning on doing this, but when the idea was floated to me I did get very curious. But it looks like I won't be doing it now anyway. Also, I didn't realized quite how illegal it was. Years in prison must mean it's a big deal. For all I knew, it was a fine it something

@Clifford Paul Oh that's rough

@Dennis M. Thanks for the response! I'm also wondering how anyone would prove I don't live there if I air b&b it, considering people air b&b their personal homes all the time. Unless air b&b is illegal in an FHA home in general? Or if I was simply rehabbing it over the whole year, could I just say I am rehabbing it before moving in? Is it legal to rehab your house in the first year of an FHA loan? Or maybe you have to live the while you rehab? Clearly I don't know any of this stuff Haha

My girlfriend and I live in a house (with a conventional mortgage) that we don't wish to move out of. I want to get into rentals, but don't yet have the capital to put %20 down on a sfr in my area. I do however have the money to put 3.5% down on a duplex or triplex. Someone recently gave me the idea of acquiring a triplex with an fha loan, rehabbing two of the units, renting them out, and taking my time with the third rehab. Or even rehab all three, rent two out and air b&b the third until the one year is up. Then I would rent out the third as well. Clearly I'm talking about getting an FHA, and then breaking the rules by not moving in.

My questions are:

1. What is your take on this?

2. What are my odds of getting caught?

3. What are the ramifications of being caught?

4. Hypothetically, if I couldn't possibly get caught, is this plan a smart one?

5. Should I refinance (brrrr style) after renting two out, or after the year has past and I have all three rented out, or not until the mortgage is paid down enough to remove the PMI?

Other notes:

I'm in Illinois

I'm a plumber

I have a good credit score

Sorry if my post is dumb

Thanks!

The guy could have put it on the market for 175k and it would've still sold instantly like it did for 80k. Did he use a realtor? Sounds like he couldn't have had a realtor, considering that a realtor would have told him that the sell-immediately price would be much higher than 80k

@Lexi Teifke I'm sorry my question was confusing. It seems like you are assuming I took out a home equity loan or line of credit on my paid off house to pay for the second home. Just to clarify, no. As the original post stated, the bank is not involved on my house. Yes, the leverage I'm talking about is a home loan from a bank for the second house. What I'm wondering is if I can't make the payments on that second house, can they come after my outright owned possessions (i.e. my house)?

@Christopher Phillips Thanks for the reply!