All Forum Posts by: Nicholas L.

@Hector Alvarez just call some individual banks - pick some national ones and some local ones.  Will help you get used to talking to them.

@Marlon Diaz cool, I don't know much about the Miami market or how much of the housing stock is small multifamily but I am sure there are agents there who do.  I asked about living in one of the units because you'll get more favorable financing terms if you owner occupy - if you just purchase as an investment property, you may have to put 20-25% down, plus closing costs, which is a huge amount of your cash to tie up.  If you haven't already, check out any of the BP posts or books related to "house hacking."  Would house hacking be an option for you, or do you already have living arrangements in Miami?

I understand what you're asking about the size of the loan - I'd put it this way.  You want a mortgage payment you're comfortable with and could pay for several months out of your reserves if your property were entirely vacant and you had no rent coming in.  So, taking out the largest loan you qualify for may not be optimal for your first property, especially given today's circumstances.

@Gerardo O. can you provide some additional information on this situation?  Are you saying that your parents NEED your help to pay the mortgage (which is perfectly legitimate), or are you asking something different?  I ask because helping to pay their mortgage is going to make it more difficult for you to invest, no matter how you do it - but if it's important to you to help, that's totally fine.  As for exploring whether is is even possible for you to assume the mortgage - you'd want to talk to the bank.  Maybe there is a forbearance program your parents are eligible for, that you can help them with instead.

@Marlon Diaz welcome.  Do you have a market or city picked out?  Have you gotten pre-qualified for a loan?  Do you have some savings for a down payment and reserves?  I'm assuming you're planning on living in one unit in the 4-plex - is that correct?

One of the main rookie mistakes people make is thinking that profit is simply rent minus monthly mortgage. The BP webinars, calculators, and forums do a good job of reminding everyone that there are many more expenses that must be taken into account - Capex, vacancy, repairs, etc.

@Channell Mcneese congrats on the purchase.  Are you inheriting a lease, or are you putting a new one in place yourself?  If you're inheriting an existing lease, you will have to honor it until it's up for renewal.  Then you can modify it or substitute your own.  If the existing tenants aren't on a lease, get one drawn up, include an estimate for the items you mentioned in the rent, and have them sign it.

@Vincent Miller congrats.  Any feedback on buying through Roofstock?  How does this one compare to the other one in the same neighborhood?

@Tyler D. I think @Joe P. nailed it, this is a screening rule.  You wouldn't want to base an offer on it, because if you're making an offer, you should have already done a much more detailed analysis than just plugging numbers from the Internet into a calculator.  Repairs might be low or high, tenants might be responsible for all or no utilities, etc.

@Chad Dunham different lenders count rental income differently.  Some want it to show as income on 1-2 years of tax returns, others will count 75% of the income if you can provide a signed lease.  So, it's lender specific.  There are a few threads on BP on this topic.

You could try to refinance and pull out more cash, I was just cautioning you not to take on any more debt until your rental is proven (rented for 2+ years). This wouldn't involve a 1031, as no taxable event occurs if you just refinance or open a HELOC. Also, most lenders will not allow HELOCs on rental properties.

@Petra Clarke welcome.  A few thoughts in no order:

-When you run the numbers on a house hack, be sure you are factoring in all expenses.  There are lots of great posts on BP about this.  Cash flow is NOT rent minus mortgage!

-I used Credit Karma to monitor and improve my credit.

-Wholesaling is like a job.  Again, lots of great threads on this on BP.

-One contrarian position: renting is NOT a bad deal in the short term while you're figuring out what you want to do next.  If buying from a distance is going to be tough, and this is your very first purchase, consider renting in the short term in LV while you find your footing.  There are no closing costs associated with moving into, or out of, a rental - in that way it's a good deal.

@Tim Andy awesome, thanks for the add'l info. I'm about to move to Pittsburgh from Virginia. I have 1 rental in VA and 2 in CT, and am excited to get into the Pittsburgh market because of the lower list price. A lot of the "duplexes" and "triplexes" in the city proper look sketchy =)