All Forum Posts by: Nadeem Alamgir

@Michael Noel Peralta

HELOCs are definitely best as a short term since rates adjust but a lot of investors still use them to access equity and get into cash flowing deals. The key is making sure the rental covers the extra debt and you have an exit plan (refi into fixed debt, pay down and etc.).

Agreed ^^ If you can stay local or near the surrounding area, you should.

But if you can't, then out of state investing makes sense. Just make sure you find decent talent before looking for deals. Check out BP's "build your team" and interview some realtors, property managers, and get some referrals to GCs, etc.

Lastly, focus on finding realistic deals you can put under contract and successfully refinance. First time BRRRR investors, especially out of state, should look for deals that are 50 cents on the dollar, as those are the most competitive to get started with. You'll be stuck 6-12 months looking for the right deal. Also, those deals come with their own set of headaches. Almost all first time investors starting out aren't ready for them.

Hey Erin, welcome to the BiggerPockets forum!

Welcome to BiggerPockets, this is the place to be @Michael Long

@Aaron Phifer

You can house hack, use financing, and let tenants cover most of the mortgage while you learn landlording. New builds are higher risk with permits and longer timelines, not ideal for a first deal. House hacking is one of the best ways to get started and set yourself up for the next deal.

@Rick Albert

1. You need to do whatever due diligence before putting it under contract with the wholesaler. 

2. You should have an attorney review the assignment before signing anything. 

3. There usually aren’t any. Wholesalers aren’t licensed and sellers often don’t provide disclosures.

If you want to protect yourself, I recommend looping in an investor friendly agent that has experience working with wholesalers/assignments. 

Pros: higher cash flow, guaranteed rent from the housing authority as long as you’re not in violation, tenants usually stay longer than private renters, and the regular Section 8 inspections help keep the property in decent shape from the many inspection reports I've seen.

Cons: Inspections can sometimes be a headache, delays move. You have to keep up with their guideline. Doesn't promise decent tenant quality and usually the higher section 8 cash flow deals are in rougher parts of town. 

It’s definitely a strategy that works, plenty of Section 8 coaches will vouch here but it comes with its own set of problem. A lot of investors I know prefer less cash flow in better neighborhoods with stronger appreciation and fewer headaches.

Welcome to BiggerPockets @Amy Leary !

Welcome to BiggerPockets @Mark Joseph Bujarski! I work with a lot of investors who’ve been adding MTRs to their portfolio for the higher rents. Have you noticed any challenges on the management side compared to traditional long term rentals in your market? 

@Mario Garcia

The main difference is that with a lease option, the tenant has the choice to buy but doesn’t have to. With a lease purchase, they’re agreeing upfront that they’ll buy at the end of the lease.

option = flexibility
purchase = obligation

In a lease purchase, if they don’t follow through, the seller can keep the deposit or even take legal action depending on state laws. That’s why most people prefer lease options because they involve less risk.