All Forum Posts by: Paul Crosby II

It is wonderful to see that you are a compassionate landlord that cares about your tenants.

What i would argue is that is that raising the rent is for your tenants benefit. Often times what happens is that if a new owner does not raises rents they are eventually forced to sell due to frustration, lack of profit etc.

It is much better for your tenants that a small business that cares about their community owns the property vs you having to sell in the future to a big corporation that will raise rents in perpetuity and not make repairs at all.

Not sure this was the advice you are looking for but hope it helps. Reasonable people understand inflation, cost of repairs and market fluctuations..hopefully your tenants fall under that umbrella

This list is awesome as i was curious about what the essentials were for STR.

Thank you!!

I would have to agree with Patricia on this one. It seems it would be simpler to just let it go.

If you are still pursing it, i would chat with the selling agent first to see the relationship they have with the seller. By your account, they have had multiple agents and seem to be chasing a result rather than operating out of personal loyalty. If they seem like they are pretty on top of things, i would work with them to get a deal done. If they are just shooting their shot at the listing and dont seem invested, on to the seller.

@Chris Winslow pretty much nailed it all on the head. It really also depends on what property type you are using the HELOC on.

For instance, credit unions will get quite aggressive on your primary residence and give you 85%-100% of the appraised value (appraised value can be physical or desktop appraisal). They are also much better with not prematurely calling/closing your HELOC before the initial draw period

Conversely, there are institutions that will do HELOCs on your investment properties which might have higher margins( The interest charged above Wall St Prime Rate) and more restrictive terms.

Definitely a great time to be looking at HELOCS so you can tap equity without affecting a fixed low rate mortgage.

The only thing i dont see on here is less intervention.

Typically during times of economic turmoil, the government will step in with rent freezes for SFH or MF.

If you are in a commercial space with commercial clients (in this case we are ignoring commercial residential) these are less likely to have an effect on your business.

Otherwise list looks solid

Hi Meng Lin!

I would have them show a preapproval to you as a safety net in case we have another crypto winter.  

Couple reasons i am suggesting this.

1.Lender would be required to verify assets and most have access to various services in order to get proof of funds. Typically Cheksystems helps for bank accounts and i forget what is used for other assets.

2.From a lending perspective, coins/tokens have to be liquidated, sent to a US or state regulated financial institution and cannot usually be used a reserves. Hopefully this changes but right now the IRS treats the coins more like property than a traditional asset like 401k or stock

Hope that helps

Hi Meghan!

I do have an Indiana license and would tell you that getting preapproved will really help you even if it isnt required by either agent.

The preapproval is valuable to you  because since rates are rising, you want to make sure the deal is still makes sense when factoring in financing and the closing costs associated with it.

The previous posts were correct in that you will need to make sure that you have the proper assets and expectations for buying two properties. You will also need to make sure they are zoned and parceled properly if you are pursuing conventional financing as most residential mortgage lenders have issues with mixed use property, non residential highest and best use etc.

Im sure someone will have already mentioned this but from a cost perspective it would be best to house hack one of them using FHA as you can put less down, lower your interest rate and get a HELOC on the property 4-6months after closing. This would allow you the most financial flexibility and keep more of your cash liquid as we wait to see if more supply hits the market.

Congratulations on being able to secure not one, but two properties! Looking forward to seeing your post on what the results are and how the deal was structured

Hi Justin!

Nice work on the equity and clear plan of action for retirement.

I would suggest looking into other markets than just Kansas as well if you goal is to retire on the income. There seems to be a large shift in technology from the West coast to the Southwest and Midewestern states. Like Nick mentioned, you can get similar priced properties in Ohio and Indiana which are a bit more economically prosperous. Kansas still rocks tho

As a second note, HELOCs are based on the Wall Street prime rate as opposed to traditional mortgage rates. This means they dont jump as high and since your payment is interest only for the first 10yrs, you will likely generate more than enough cashflow to satisfy the monthly obligation.

Looking forward to hearing what you end up acqurining, good luck!

Hi Maureen!

What a leap of faith! That is incredible.

I would definitely suggest tax lien investing podcast from Bigger pockets. You might be able to leverage your cash and end up owning a property on the cheap.

In regards to using credit, you could use a secured loan on a vehicle or other asset but not unsecured debt.

I will say that typically lenders look at a 60 day window for your bank statement and  dont go into much detail on why your cards are at their current limits.

Hi Janet!

I would be curious to see if you could get a HELOC on your home or partner with one of these home equity companies that requires paid after so many years.

The HELOC would be ideal since most of them have int only draw period for 10yrs and then become fully amortizing afterwards. This would likely allow you pretty decent cashflow while you work on the repairs. Some credit unions will go up to 100% if owner occupied while lenders like Lower,Huntington, PNC etc will usually go up to a max of 95%

Congratulations on the new acquistion!