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All Forum Posts by: Matt Hangsleben

Matt Hangsleben has started 4 posts and replied 10 times.

Post: Should I add another R to BRRRR?

Matt HangslebenPosted
  • Rental Property Investor
  • East Grand Forks, MN
  • Posts 10
  • Votes 21

Drug my feet too long on this one. Put in an offer but was too late. I am going to follow up in case the sale falls through or is delayed with a contingency. Lessons learned: Don’t be hesitant, the numbers looked good, I should have ran them sooner. I had a friend/contractor give me an estimate. It took too long to receive. In the future I’ll try to do most of the estimating myself.

Post: 401K: Continue Contributions or Stop?

Matt HangslebenPosted
  • Rental Property Investor
  • East Grand Forks, MN
  • Posts 10
  • Votes 21

@Jonathan R. Cool! I’ll check it out. Thanks.

Post: Should I add another R to BRRRR?

Matt HangslebenPosted
  • Rental Property Investor
  • East Grand Forks, MN
  • Posts 10
  • Votes 21

@Joe Splitrock thanks for the response, there is some concern from both my wife and I about living that close to my parents but we are both on board for living next to my parents as long as it's a short term arrangement.  My parents would probably say the same thing, haha, we have three boys 8,7,5 that are full of energy!  

I do want to make sure we have enough cash flow when we refinance so I may not want to pull out 95%.  At lease we will have that flexibility to do so if we would like.  

Post: 401K: Continue Contributions or Stop?

Matt HangslebenPosted
  • Rental Property Investor
  • East Grand Forks, MN
  • Posts 10
  • Votes 21

Thank you everyone for the feedback.  It's great to hear so many perspectives and it's good to have options!  I think for now I will stop contributing but leave what's in there alone and start building up savings.  I caught the Real Estate Fever after making my first purchase a month ago and cant stop searching for my next deal!!!

Post: Should I add another R to BRRRR?

Matt HangslebenPosted
  • Rental Property Investor
  • East Grand Forks, MN
  • Posts 10
  • Votes 21

I am currently looking to purchase my 2nd rental property and am trying to figure out what strategy to use. I have some friends that have acquired their single family home portfolio by living in all of them for a year prior to renting them out. This allows them to only put 5% down initially and repeat the process every year. I am getting started in real estate about 10 years later than them and have 3 young kids which would make this a little more difficult. I have also been reading a lot about the notorious BRRRR strategy and have been considering both options as I look. While the BRRRR strategy sounds like the best route to go as it requires no money down, I am looking to sell my current home and thought I would look for something we could live in for a year and then rent out.

I found a house that is listed under value and has room for improvements (needs a new roof, has no furnace or AC, outdated and not kept up).  The kicker is that it shares a back yard with my parents house which has my kids thrilled about moving there.  So I am trying to figure out what strategy would be the best to use.  This is where the additional "R" comes into play; RESIDE.  I am thinking of Buying it (under value with private money), Rehabbing it (some right away and some while I am living there), Refinance it, Reside there for a year, then Rent it out.  

By residing there I would have the option of taking out 95% of the after rehab value instead of the traditional 75%-80%.  This would also depend on the appraisal value, rent price, and how much cash flow I want.  I am new to this and would appreciate your opinion.  Thanks!

Post: 401K: Continue Contributions or Stop?

Matt HangslebenPosted
  • Rental Property Investor
  • East Grand Forks, MN
  • Posts 10
  • Votes 21

Thanks Tahra!  There is no employer match.  And I do agree I need to find somewhere to keep it other than my checking/savings accounts.  Time to start looking for a fund to put it in.

Post: 401K: Continue Contributions or Stop?

Matt HangslebenPosted
  • Rental Property Investor
  • East Grand Forks, MN
  • Posts 10
  • Votes 21

I recently purchased my first rental property with no money down.  I did so by necessity as I am cash broke!  However, I do put a substantial amount of money into my 401K account every pay check.  I have always been relying on having a very nice nest egg waiting for me when I retire, but like many of you, am starting to realize that I don't want to wait until I am 65 to enjoy it. 

For the last 10 years I have been so focused on building up my 401K, but now for the 1st time I am really considering stopping all contributions to focus on real estate investing.  I ran the calculations and found that my projected 401K value when I retire will be cut in half if I stop contributing now (age 36) and leave what I have in there.

I'm looking for advice!  Have any of you taken the plunge yet, how has your experience been?  Any recommendations???  Thank you!!!

Matt

Post: 1st Rental Property Purchase

Matt HangslebenPosted
  • Rental Property Investor
  • East Grand Forks, MN
  • Posts 10
  • Votes 21

Investment Info:

Small multi-family (2-4 units) buy & hold investment in East Grand Forks.

Purchase price: $199,000

Bought a 4-plex slightly below market value from well known long time owner. Many new updates, very well taken care of, long term tenants.

How did you find this deal and how did you negotiate it?

I ran into my parents neighbor at my sisters wedding and asked him if he was interested in selling his 4 plex. He told me he was in the process of possibly selling it to someone else that was interested but said he would rather sell it to me if I wanted it. He had already agreed to a price with the other guy so I agreed to that price.

How did you finance this deal?

80% Commercial Adjustable Rate Loan - 5 yr fixed rate.
20% Home Equity Loan - Rolled closing costs into this loan.

Post: Appraisal Fees Seems Too High

Matt HangslebenPosted
  • Rental Property Investor
  • East Grand Forks, MN
  • Posts 10
  • Votes 21
@Cee Small that’s more like what I was expecting.

Post: Appraisal Fees Seems Too High

Matt HangslebenPosted
  • Rental Property Investor
  • East Grand Forks, MN
  • Posts 10
  • Votes 21

I am purchasing a 4 plex (2 bedroom 750 sqft units) in East Grand Forks, MN.  I just received a list of closing fees and the appraisal is listed at $1,400.  This seems outrageous to me but I've never had a multi family property appraised before.  Does anyone have any thoughts on this?  Thank you.

Matt