All Forum Posts by: Matthew John

Joe Davis Does BRRRR not work well using a conventional loan? The terms aren't set because I haven't actually made an offer or purchased anything. Interest rates are bouncing around near 4.5% at 30 years.

Brent Coombs I'm looking to put a 20% down payment and finance the rest

@Joe Davis I'm trying to figure out how to run the numbers, from what I have been reading it's off the price you're buying it for. 

Now I'm questioning whether that is right and I should be calculating numbers from the ARV.

House is a foreclosure at 146k. Comps are around 200k - 210k. 

I'm looking for conventional loan, 20% down. It needs 10k in rehab. 

I would try to get it at 135k or 140k, so 150k would be my 'all in' with rehab + closing costs. If the ARV is 200k, that's a 50k difference.

It would rent for $1400-$1500 once it's rehabbed. 

@Brent Coombs In this case, the property is listed at 146k. It's a foreclosure. The banks listed it in Jan 2018 for 166k, then 154k, now 146k. Not sure if there's much negotiation with banks. 

So when doing analysis I shouldn't calculate mortgage off what I'm looking to buy the house for?

I should calculate off what it would refinance for? How do you know?

I'm getting super confused now

@Andrew Postell I'm looking to put 20% down to avoid mortgage insurance. I'm just looking to get a conventional loan. 

So when I'm calculating my numbers for a BRRRR, I should be calculating my Mortgage expenses off the ARV price?

In this example I'd be buying at 140k and comps are 200k. So it fits the 70% rule well. It would rent for about $1500/m. 

Doing the calculations off the 140k I'm buying it for, everything looks great. Doing them off 200k, not so much. 

I honestly don't see how BRRRR works if you have to calculate it all off the ARV. Nothing seems profitable like this.

I think I'm looking at it wrong

Hey guys - I'm in the process of finding my first deal & confused a bit by the numbers. 

Let's use this example....

I buy a house for 140k that needs about 10k worth of work. I spend 150k total. 

My monthly mortgage is $900. 

I fix up the house, get it rented for $1500/m and I'm starting to cash flow. 

Now I want to move onto the Refinance part to pull out some equity and move onto property #2. 

The house now appraises for 200k and they give me back 50k during the cash out refinance. 

Here's where I have some questions...

1) Does my mortgage payment now increase from the original $900 since it's now worth more?

2) Should I be calculating my numbers off the ARV value?

Thanks for the help!

Joe Villeneuve But doesn't that matter to future tenants/resale value? Couldn't the numbers be good but if you can't resell it or rent it out, why bother?

Hey guys, I'm still kind of a noob scouting areas for my first deal. I've narrowed down the areas I'm searching in to 1 county and a few different cities within that county. I know people look at schools in the area and the rest of the neighborhood, but what other external criteria do you go off of to analyze the micro market? I'm currently looking at a deal in a quiet, older neighborhood. It's a safe area, good schools, right by a grocery store, and on a dead end street (no traffic). With my first investment, my goal is to house hack a duplex/triplex and renovate while living there before moving onto the next one. This particular deal has been on the market since January 2018, it started at 135k and now down to 124k current price. What should I be focusing on when analyzing a deal that doesn't directly relate to the house? Thanks for all the help!

@Michael Lee Thanks for the reply!

In order to figure out if I can do Owner Financing, I just need to talk to the owner? Explain I have money for a down payment and then we negotiate terms?

Might be a hard sell to a first time buyer, but worth a shot. 

I read private lender is out of the question because they don't allow you to live there. It's purely for investment property. 

How do you go about finding a partner? I keep getting that, but not sure who is going to partner with someone that's new and looking to house hack.  

Hey guys, I'm in a kind of unique situation. 

I'm looking to house hack a multi family 2 unit that's currently going for around 110k. 

My issue is I don't qualify for a loan from the banks. I don't have a job, I've been self-employed for the last 6 months. 

My girlfriend is a full time student and only works part time, she made around 32k gross income last year as a Nurse. She has been employed in the same field for more than 2 years, but doesn't meet the income requirements to purchase the home. 

I have capital for a 20% down payment, but the lenders want to know where the money is coming from. My online business doesn't count because it hasn't been a full year and there's no taxable income until next year. 

I've talked with my parents about co-signing a loan, but they don't make enough money to qualify for a 2nd mortgage. 

Since I'm looking to live in the property while fixing it up, hard money lenders wouldn't qualify me. 

What other options are out there for financing? This seems to be the biggest struggle right now. 

Any help is appreciated! Thanks