All Forum Posts by: Patrick Kucera

@Roman M. - Would it be a better idea to start off with a joint venture with a seasoned note investor with my $10-20K? 

John...I'm not sure about the tax implications, but my cousin (@Dan Mackin) is a RE Professional in the Denver area.  Perhapse he could be of assistance.

Patrick

Good Morning BP! 

I've been away from the community for some time while I've been stationed overseas and I'm looking to get some feedback/constructive criticism on an addition to my investment strategy. When I was younger I had some mentors tell me that while the Military moves you around, buy a house at each location and rent it out. That way when you retire you have a number of rentals as passive income. I've used that strategy and have acquired 2 rental properties (one in Florida and one in New Jersey). However I've been overseas for years and have not bought in England and Guam (current location). My family and I plan on moving back to the states this summer and using the remainder of our VA allowance to buy our next residence. Here comes the change in strategy...

I've been listening to the BP podcast recently and came across Note investing.  I thought this would be a great additional supplement to the buy & hold rentals as we continue to move.  We've saved about $60K and I'm looking to start with a small note ($10-20K) and then when our savings is replenished from the note payments plus monthly savings buy another one similar to the Bond Ladder strategy (https://www.schwab.com/public/schwab/investing/accounts_products/investment/bonds/individual_bonds/bond_ladders). 

I'm looking to invest my own funds and I'm targeting passive cash flow.  I've been reading BP posts and listening to the NoteMBA podcast to get familiar with this investment strategy.  So far it looks like I would be looking for 1st position performing notes.  Am I on target here or should I be looking for something else that I don't know of yet?  I'm looking to make our first purchase before the end of the year, so I have some time to research/find a Note that works.  Also, where would be the best place to obtain a Note like this?  I've read that I probably won't pick one up from a bank so a Note Marketplace would be the ideal option. (NoteDirect?)  Finally, I haven't found any details on what documents you'd need to have to file your taxes.  I send all my documents to an accountant...just wondering what additional documents I would need for the Note.  Thank you for any comments/feedback you can provide.  I really appreciate it!

Patrick

@Paul G. - This includes escro for taxes.  If I take that out it would be about $5K for closing.

@Ricardo R. - Thank you for your help with the analysis. I understand your intent with the VA loan use, and I've checked into that. I have a total of $417K available for a VA (less my current VA balance) so I have a little over $200K remaining for our next move. We plan on moving this summer and will use the remaining VA for a new residence. For the refi options I'm looking at the rate refi like you mentioned to increase cash flow for expenses and reinvestment. Thank you again for your help!

Patrick

@Ricardo R.- Today its worth around $250K and I bought it at $238K

@Harjeet Bhatti - For my current mortgage I'd pay $171 in interest over the 30 yr term, and with the refi I'd pay $113 plus the $10K closing. However if I'm netting an additional $110/mo for 30 yrs that's $39.6K. My plan is to take the extra funds (minus CAPEX) to start funding notes. Do you see anything I calculated incorrectly? I'm leaning towards taking the extra cash flow.

I received an offer to refi a 3/2 townhome rental property I purchased as a primary residence in 2011 for $238K @ 4% through a 30 yr VA loan. The current balance is $210K and current monthly payment is $1718. The offer is for $220K (addl $10K closing/fees) 30 yr VA refi @ 3.5% with a monthly payment of $1609. Cash flow would increase from $130/mo to $240/mo. Plan on keeping the property as a rental long term. I know cash flow is king, but I'm looking for another set of eyes on this to see if its worth a refi. Thanks for any help!

Patrick

@Angel Gracia How has your rental done in Guam?  I'm wondering because my family and I just recieved orders to Guam and we'll be moving in Jan 2016.  Would you be able to recommend any real estate websites to search for properties and property managers?  Do you use a property manager or manage yourself?  Any information will be helpful...thanks!!

@Roland Gray I was wondering if you're still in Guam.  My family just recieved orders to Andersen AFB with a move date of Jan 16.  I am contemplating buysing a property there if the numbers will work out.  Do you have any real estate sites you could suggest?  I've tried Zillo, Realtor etc with no results.  I'm wondering if since its s small local market there might be smaller companies in the RE busniess there.  Thanks!!

That's right. I have 2 management companies (Century 21 & Long and Foster) because the properties are in 2 different states. Its worked out very well for me, because I'm too busy to manage properties and my wife isn't interested in management either. I've had a few repairs on each property and they simpley email me and we work it out. They also do the bookkeeping and prepare the tax document and expense lists. I have an accountabt in my hometome in NY who does all the taxes for us and gives us advise. Now that I've decided to really get serious about REI I'm looking to learn more about the best ways to continue. When I retire from the military...I want to go fishing!