All Forum Posts by: Nick Moriwaki

As someone who employs this strategy, I will offer up a couple of insights/comments to posts above.  I believe the strategy is popular here in Hawaii for 2 reasons:

1) Hawaii banks offer great introductory promo rates (1.75% for 2 years, 2.49% for 3 years etc...) prior to converting a variable rate.  This may be available nationwide, but the few other posts I've read about HELOCs haven't mentioned this. 

2) The cost of living here is so high that most people who make a decent salary can only scrape if they have other bills to pay (family, school loans, etc...).  Therefore, people cannot build up the bank account to even consider an investment property. 

The strategy is fundamentally different than paying off a traditional mortgage in that you use your HELOC as a place to store your money. All your money coming in goes towards paying down your balance and all expenses will essentially come out of the HELOC (routed through a checking account). In essence, your HELOC (assuming it is large enough) becomes your pseudo checking/savings account.

One last note about the strategy is that, contrary to what has been said in this thread, the available balance in a HELOC can be used for a down payment. So if you can pay down the balance much faster using 100% of your income coupled with extremely low promo rates, you can do major damage to your principle owed and then turn around and immediately use that money to purchase another investment if you want.

@Jasmine C.

You mentioned that you know you would be able to get $300K private money.  Is that from a personal source or a company?  I've always wondered about private money but have never looked to much into it as I am just starting out.  Any information you, @Michael Borger, or anyone else has would be much appreciated.  

As for your original post, it seems like the situation is pretty complex as others have mentioned.  One additional thought - does the ex husband need to OK the sale to you if he is owed a portion?  If he does this would most likely raise the floor of the price you could get it at.  Depending where in the process he signs off on selling the house would make a huge difference on whether or not I would even consider pursuing any of the options provided to flip the house.  And if he doesn't have a say in the sale price, couldn't your friend pass it on to you for cheap and split the profits on the second sale?  No experience here so I could be way off base, but just thought I'd add my two cents since I was already replying to the post.  

@Andrey Y.

Curious as to what areas you are getting on Oahu that you are getting ~1% rent/purchase price while also getting >$500 of cash flow.  I've only recently gotten into real estate, but from what I've seen, the 1% properties here seem to be more like the 1.5 - 2% properties elsewhere (C Class).  

Since the cost of real estate here is so high, I'm assuming we're talking about condos.  If these 1%, $500+ cash flow, A/B Class areas/buildings do exist I would really like to know about them.  Sorry this is slightly off topic from the original post, so please PM me when you get a chance.  I would really appreciate it.  

Also willing to meet up with people who have information regarding rentals on different parts of the island.  Also interested if anyone has information for acquiring properties out of state.  I am in downtown so also quite a ways away.  

Hey everyone, my name is Nick from Honolulu, HI.  I recently went to a real estate seminar and it really opened my eyes to the many opportunities there are for out of state investments.  

Growing up in Hawaii I had heard that the cost of living was much higher here than the other parts of the US, but I never bothered to browse prices in the mainland since I never wanted to live anywhere else.  I was in shock at what a relatively small chunk of money can get you in the mainland and how easy it is to cash flow if you pick the right location to invest in.  In the past week or so I have been obsessed with reading through forums, blogs, and comments about different opinions and strategies and I decided to finally make an initial post.  

I've seen bunch of people on the site saying they are out of state investors and was wondering how to get started.  I know I would like to try and start investing in the Las Vegas area as it is the one place I travel to somewhat regularly (about once a year).  How do I go about looking for a realtor / attorney / property manager / that I would need to start investing?  My biggest fear is surrounding myself with sub-par people who will hinder my ability to expand my real estate portfolio.  Any tips about how to get started?

Also, as I mentioned, I'm extremely new to the real estate world so any other general tips / suggestions / words of advice would be much appreciated.