All Forum Posts by: Richard C.

Awesome Job @Andres Perez! Were there any other requirements from your mortgage broker in terms of showing 2 years of steady employment history? tax returns/Pay stubs/w2s, credit score? Or was it mainly just showing a bank statement of 8k in reserves and that was it? Keep up the good work!

Does a tenant already have to be in place for lenders to count rent as income for financing? What if its vacant or being rehabbed and "its going to be rented out", can they base it on the projected future rent even if theres no current tenant? 

Piggybacking on this topic, I wanted to ask about these lenders that lend you based on your rental income helping your DTI. Does the potential purchase property have to already have a tenant in place? What if you're buying an investment property with the intentions of renting it out, but its not tenant occupied yet? They can still give you a loan and calculate on the future rent as your income to combat DTI ratio?

@Joseph Scorese Do you mind explaining what is the FNMA 10 Mortgage rule? Thanks. 

@Account Closed

Are you already in process of selling your company or have you sold it yet? It sounds like this "40-60k" is all you have and you want to cut ties with your prior career quick, and you want to know a clear answer and your chances in the real estate investing game. It's tough to say, and as you said after letting go of your company in a sense you will be unemployed. I understand you want to know about having more capital for a down payment for multiple properties and that you are more worried about that than financing and getting the mortgages. I beg to differ, as it'll be way easier when you have income showing (from your company/job) to lenders so you get these funding/down payments for many properties. I would be more worried about the financing because that is your leverage which is KEY. Doesn't matter if you have 5k or 40k or 100k, if you were always able to get financing all of the time on your investment properties then you'll be a rich man! A lot of successful RE investors I talk to know how to make things happen, and I notice the biggest wall they told me is always if they can get a bank to lend them the money for it in the first place, and the rest is history as they know how to use other peoples money to work for them. So if you want to know how to get 14 properties without 280k cash, that's basically it.  There's so many other options too to keep getting properties without thinking you need 20% down liquid cash each time from your savings....there's cash out refinance or lending based on your rental property (after you get your first or second property etc). Trust me,I hates jobs and would love the financial freedom but  It sounds like your company was doing well, I wouldn't throw it away yet. Maybe use that to help your RE and then slowly taper away and transition into a full time RE investor, it just seems like you're ready to drop it all and try to make a home run start with just "40-60k" only. Just a thought, not sure if it was helpful or not! Good luck! 

This is a great topic. Just as others have said with cash flow and cash on cash return. I think another quick and basic filter could just be seeing if the property is listed under market value or could be bought at a discount. You'll go in with a built in profit and equity already.  Nothing special, but at least it can catch your eye to see if it's good deal from the jump or not. 

 Hey Ben, 

just curious how you arrived with $300 cashflow after using the 50% rule. If the total rent is $2540, 50% of that is $1270 towards expenses, the other 50% of $1270 that is towards you mortgage? I'm assuming not including the PMI, taxes and insurance. So is your mortgage $970? Leaving you with $300 cashflow? I'm still learning the breakdown of numbers so I wanted to see is this how you calculated yours? Thanks.

@Kenneth McKeown Instead of just the $2000 down payment , you may want to add on to your total investment with closing costs, rehab/repairs you will be doing right away, and other miscellaneous stuff that you can think of. I think it's better to over estimate a little than underestimate when running the numbers to play it safe. 

@Mindy Jensen There's always a possibility to up the income whether its a second job, or doing more hours on the main job. Either way its going to take time for it to report on a tax return ( a whole year) and even if I upped the income somehow, I'll probably have to let it ride out for a good 2 whole years as well, as most lenders ask for the last two tax returns correct? Lastly, a problem is waiting that long when I would like to get started on investing asap and even if the income goes up it wouldn't be a huge amount. I'm thinking of co signing, or partner up with another investor, or sellers financing, etc as the only way to get my foot in the game. I'm assuming once I build up rental income that'll it'll open more doors up for loans that way. It's just the initial start thats hindering it. 

@Brad Schultheiss I do plan to live in it, and rent the other units. My main focus is a multi family property.