All Forum Posts by: Martin L.

Jeff Dulla I have no concrete plans at the moment, so I don’t know how long it would take me to repay. HELOC rates would run me about 6-7% from what I’ve been seeing. I’d probably be using the HELOC funds to either put a down payment on one or two additional properties, or possibly buy one or two properties cash outright in an overseas emerging market. Riskier I know, but also higher potential return. If I really wanted to focus on paying the HELOCs back, I could probably do it in 2-3 years, but I’d probably want to extend it for as long as possible (so probably 10 years?) and use any cash for additional investing.

My number one criteria for buying in a location is having a reliable a trustworthy team to handle my investment for me. Seriously, everything mentioned here is important but if my property management team is crap... read some of the comments from some of the other investors about how bad their property management teams are. Right now I’m about as ‘out of state’ as I can be, and my property manager really handles everything and just messages me for approvals or a Docusign on a new lease agreement. You’re not there. You need someone(s) reliable to make sure your property is well maintained and occupied.

I’m debating between the two right now for my first property. I’m looking to get a little more aggressive with some investing and want to get some cash on hand. Some basic details: Value: 320k Owed: 80k Rent: 1350 Payment: 650 (incl. taxes and insurance) Should I get a HELOC or cash out refi? Either way I believe I’m looking at being around 25% down/equity and either getting 160k cash on hand or a 160k credit line. I want to keep the payments around 1250 so I can still minimally cash flow. I’d be doing the HELOC with PenFed, since they seem to be one of the few who will HELOC an investment property. For the refi I would probably shop around, although I’d be highly likely to use Guild Mortgage due to an existing good experience with them (they haven’t sold my loan yet, and that’s a personal pet peeve lol) Any strong opinions in one direction or the other? What kind of fees am I looking at for one over the other?

Samuel, Like Bill, I invest in Vegas as well and it’s SFRs all the way. I had a really difficult time getting he numbers to work on pretty much any condo ‘deal’ I could find. The HOA would always eat up any possibility of positive cash flow and would sometimes make it negative. I’m not a big investor, but I’ve looked at literally hundreds of properties in Vegas. Run the numbers yourself. If you can catch a great deal, go for it. But chances are more likely than not that you’ll find the same thing we did. Bill has a lot of great reasons in his post but at the end of the day, you’re trying to invest. Compared to a SFR, a condo has less cash flow and less appreciation.

What’s wrong with Vegas? I mean... there’s lots of things wrong with every city, but what’s your wife’s specific issue? I have several friends who refuse to leave Vegas. Personally, I prefer SF... but I can’t afford it. Haha.

I’ve invested in China and looking to possibly enter Vietnam, although more research is needed as they appear to have some cumbersome laws regarding transferring money back OUT. I love the overall performance I’ve gotten in the US, but I don’t want to have all my eggs in one basket.

Hey Jon.  Thanks for the welcome.  I'd love to do a meetup some time, but as I mentioned, I've been living out of the country for the past 6 years.  Perhaps if I ever get transferred back...  I I would love to attend some of the meetings!

John, Love your drive and ambition, but you might want to lose the victim complex. It won’t help you. I haven’t been through everything you’ve been through, but I’ve been through quite a bit of it, and frankly spending any energy moaning or even thinking about it won’t help you in any way. One little secret between you and me though, I’ll agree with you on just one point. White privilege does exist lol, I live with it deeply every day but you just work around it. It has nothing to do with you. It doesn’t actually hurt you or detract from you in any way. That said, you’ve gotten a lot of great advice here but let me add to it. Credit score. Some people have mentioned it and I will too. You really want to work on it and get it up by about 100 points. Now right now you’ve got two choices. With that score you won’t get optimal rates, your safety net (cash) is very low, and anything you want to do will come with a lot of risk. If you want to jump into it now, you won’t have time to build your credit score, so you don’t really need to read any further. However, if you DO plan to listen to those telling you to build your nest a little more, then hit the grindstone, hustle every penny you can, and get some credit cards if you don’t have any yet. I recommend about two. I highly recommend checking into a few cash rewards cards that have a sign up bonus that you can achieve through normal spending. If you can pocket the signup bonus towards your future home, it’s even better. Just don’t try this if you can’t make it for your regular spend. Keep in mind, you MUST pay off the credit card every month. This isn’t to help your credit score, it’s to keep from paying interest which is basically throwing money away. But you need these cards towards building your credit score if you don’t have any yet. Bear in mind as well, getting a credit card will drop your credit score by 10-20 points for at least several months. I wouldn’t get any credit card within a year of applying for a loan, optimally not within two years but a higher score will save you thousands, if not tens of thousands on your future mortgage and you might as well work on the score if you’re building your cash. And that education... listen to your dad. I’m actually about to head back to get my masters finally because I finally realize the value of having that piece of paper. My day job is what has enabled me to buy 4 domestic and two international properties and I’m looking to purchase possibly two more this year. I honestly wish I started thinking the way you are when I was 21. If you hunker down and build the foundation of your financial house first (income, credit score, and cash base) I think you will have a golden future ahead of you. Oh, and I might want to mention that I actually have NO car right now for the past six years. I walk to work. No car payments, no insurance payments, no gas or maintenance... it’s amazing how much I’ve been saving. Final note: If you’re not handy, I highly recommend getting some experience anywhere you can. It will save you tons if you can do your own repairs.

I’d double check with your tax preparer to make sure you didn’t just misunderstand the first time around. If he’s still saying the same thing, I’d highly recommend getting a different tax preparer. Not to be mean, but if he’s still mistaken then he clearly is lacking knowledge in certain parts of the business, particularly in regards to real estate, which is what you’re doing. It begs the question, what else is he lacking knowledge on? If you’re going to continue to invest in real estate, you need someone who understands those aspects of the law.

I’ve been out of the country for the past 6 years and Docusign has been a lifesaver.