Skip to content
×
Pro Members Get
Full Access!
Get off the sidelines and take action in real estate investing with BiggerPockets Pro. Our comprehensive suite of tools and resources minimize mistakes, support informed decisions, and propel you to success.
Advanced networking features
Market and Deal Finder tools
Property analysis calculators
Landlord Command Center
ANNUAL Save 16%
$32.50 /mo
$390 billed annualy
MONTHLY
$39 /mo
billed monthly
7 day free trial. Cancel anytime
×
Try Pro Features for Free
Start your 7 day free trial. Pick markets, find deals, analyze and manage properties.
All Forum Categories
All Forum Categories
Followed Discussions
Followed Categories
Followed People
Followed Locations
Market News & Data
General Info
Real Estate Strategies
Landlording & Rental Properties
Real Estate Professionals
Financial, Tax, & Legal
Real Estate Classifieds
Reviews & Feedback

All Forum Posts by: Matthew Porcaro

Matthew Porcaro has started 8 posts and replied 435 times.

Post: FHA 203 K loan information

Matthew Porcaro
Posted
  • Rental Property Investor
  • Long Island, NY
  • Posts 444
  • Votes 327

@Cheryl Moore

To this date my first house hack/BRRRR house I ever bought using the 203k was the best purchase I've ever made.

As stated above, as long as you get an experienced 203k lender on your team, and effectively compile a list of 5-7 licensed, insured, and bonded contractors to bid the project, it’s absolutely worth the endeavor.

The reality is you’re putting such a low down payment and the ability to finance all of the renovations, all at record low rates. It’s a win win if you purchase a property at a good price and build in enough equity to be profitable after the rehab.

On my deal, I purchased a deeply distressed 2 family in a rough part of town for $270k. Renovation was $80k which made my 203k loan total $350k.

After the renovation my property was reappraised for $480k, building $130k of equity off of a roughly $10k out of pocket investment.

I also never paid the mortgage after moving in, since my tenants covered my debt service each month.

If you ever have any more questions don’t hesitate to reach out!

MP

Post: Where did you start from? How did you finance your first deal?

Matthew Porcaro
Posted
  • Rental Property Investor
  • Long Island, NY
  • Posts 444
  • Votes 327

@Trent Thompson

The 203k helped me finally get my very first house hack / BRRRR deal under my belt.

I purchased a distressed duplex for $270k, wrapped the $80k rehab cost into the loan making the loan $350k total.

In 6 months after the rehab was complete the house reappraised for $480k, and since then has appreciated to $520k in just 4 years.

In addition, I’ve never paid the mortgage on that since moving in, as my tenants paid it while I lived out the first year. Once I moved out I started cash flowing $2k a month.

The 203k is wildly powerful and as long as you have an experienced team on your side during the process you will be fine.

Post: Thoughts on this property rehab

Matthew Porcaro
Posted
  • Rental Property Investor
  • Long Island, NY
  • Posts 444
  • Votes 327

@Mackezi Spear

It’s won’t be too big a project to take on, as long as you have an extra 20% of a construction slush budget tacked on.

The only thing that can screw you is under estimating a rehab.

I’d say, as a contractor, that 80k estimate looks a bit light.

You need to find several other contractors to bid this, and ensure they’re licensed, insured, and fully vetted with good references.

Post: Purchasing Duplex using FHA

Matthew Porcaro
Posted
  • Rental Property Investor
  • Long Island, NY
  • Posts 444
  • Votes 327

@Andrea E.

I agree with Andrea! I did the same thing on my duplex.

My team wasn’t too great, and I learned the hard way. Make sure you start finding contractors early and developing a list that you can call when you’re ready for a bid.

You can build a ton of equity on the deal if you buy right and make sure your building will cash flow at your loan amount.

Post: Seller's Concession vs. Low Appraisal

Matthew Porcaro
Posted
  • Rental Property Investor
  • Long Island, NY
  • Posts 444
  • Votes 327

@Nyle Emerson

The 203k allows you to have a loan at 110% of after renovated value so it could buy you some wiggle room.

If your appraisal comes back too low, the reality is you’re not buying right.

In the NYC market right now especially, there’s no reason to be overpaying for a property.

Keep all the concession as you’ll need it for closing costs. If the appraisal comes back too low, renegotiate the purchase price. Contingency or not.

Everything is negotiable in real estate.

Post: Rehab loans besides 203k?

Matthew Porcaro
Posted
  • Rental Property Investor
  • Long Island, NY
  • Posts 444
  • Votes 327

@Devyn Caraballo

203k’s are not as daunting as they seem.

Problem is there are people that know nothing about it, spreading misinformation because they don’t understand it.

There’s professionals out there that are experts with the 203k and make it a pleasant experience.

Fact is the 203k loan is way too powerful to ignore.

Does it take extra paperwork and due diligence? Yes.

But nothing good comes easy.

Just my two cents.

Post: Looking for GC with 203k experience in the Inland Empire

Matthew Porcaro
Posted
  • Rental Property Investor
  • Long Island, NY
  • Posts 444
  • Votes 327

@Andrew J Hart

I’d ask your professional network for referrals. A consultant can give you a list but often will make you sign an affidavit stating that they didn’t steer you towards any specific contractor.

Either way, you should always vet a pool of contractors, sprinkle in some referrals as well as cold leads from places like Angies list etc.

At the end of the day you should look for the most highly regarded and reputable contractors in your market.

Post: FHA 203K loan- What do you know?

Matthew Porcaro
Posted
  • Rental Property Investor
  • Long Island, NY
  • Posts 444
  • Votes 327

@Jonathon Nila

Time to start analyzing deals! I talk about how I did in my book if you have that. Use that as a reference!

Of course, if you have any specific questions don’t be shy to reach out.

Good luck!

MP

Post: Advice for a newbie in Houston

Matthew Porcaro
Posted
  • Rental Property Investor
  • Long Island, NY
  • Posts 444
  • Votes 327

@Megan Hodges

Megan knows what’s up!

The 203k loan is the best way for a beginner to build quick equity in this game.

I bought my first duplex for 270k, wrapped the 80k renovation costs into the mortgage for a loan total of $350k

After renovating I had $130k in equity, (it was worth 480k when I was done) and lived for free in the meantime by renting out the other unit.

If you have any questions specifically about the 203k reach out!

Matt

Post: FHA 203K loan- What do you know?

Matthew Porcaro
Posted
  • Rental Property Investor
  • Long Island, NY
  • Posts 444
  • Votes 327

@Jonathon Nila

Absolute best decision to make. I did the exact same thing you’re doing. Bought a distressed duplex and house hacked it.

If you find a good lender, the rest will fall into place.

Also, get your contractors lined up early, otherwise you’re going to be scrounging for them while you’re in contract and that’s not fun.