All Forum Posts by: Sergio Aguinaga

@Aditya Soma what’s your monthly cash flow and how many units?

@J Scott hey, first I’d like to start by saying thanks for answering questions from everyone here. What I’d like to ask is advice for me, since every situation is different so I’ll start by talking about my situation. First off, I’m 26 (27 in March), own 1 rental property renting for 1,050 and it costed 75,050. I put about 15k into it not expecting I’d be putting in that much but I’ve had some lessons learned there. The home next door was sold for 75,000 just recently and mine has an attached garage (theirs in the back), 1 more half bathroom, more lot space, chimney, and about 200 more sqft. Houses in the area usually go for 80,000 if they’re as neat on the inside otherwise than they’re obviously cheaper so I’m guessing my house is currently worth between 80,000-85,000 but I’m not expert in appraisals or anything. Anyway, the home was purchased all cash, and I have to repay family back a total of 50,000 by May 2020. I’ll be paying half of it this May. Since I’m living at my parents, I’m able to save quickly but I do plan on buying a duplex right before marriage sometime in 2021 if all goes as planned haha. I earn 80,000/year at the moment as a software developer but salary increases annually like 3%. I pay 300 for living at home so I save up most of my money. Anyway, I want to retire by 45 latest (preferably 42). So my questions are:

1. Would you recommend getting an FHA if I qualify for the duplex or get a conventional loan if I can afford both?

2. After the duplex I'll have to restock in cash and wait. I'd want a quadplex next so the down payment will need to be higher. What do you suggest I do with the home I have paid in cash (heloc, refinance), or should I leave it as is. I personally wouldn't want a heloc because they're variable rate loans and if I mess up my next deal and I can't pay back by not being able to refinance (by doing BRRRR), then I'm screwed so I'd like to play it a little safer since I'm not very experienced in the rehabbing area. If I refinance, I wouldn't want to affect my cash flow where I have none. 200 is reasonable since it's a single family home.

Anyways, this seems too specific but I just want to see what my options are to line up to meet my goals. Thanks!

@Brandon Turner what style of duplexes do you prefer and why? Sometimes they have separate meters, furnaces, bedroom count and styles. So do you specifically go for those that are 2 unit each front entrance, or those that were houses made into 2 units with 2/3 rooms 1st floor and 1 bedroom second floor with a backyard entrance. There’s also some that are 3 units in each floor. So can you give sort of what you tend to look for in a duplex for a lower vacancy, easier management, etc. assuming all other variables like location and tenant quality etc. are held constant.

@Steve Emling based on my experience, it is in the following order of importance:

1. Location

2. 3 bedroom with good sqft.

3. Garage

4. Something that stands out like nice kitchen, etc.

5. Basement

6. Additional half bathroom

If your home has all these, finding good tenants shouldn’t be hard.

@Jake C. That seems to be the trade off. Either cheap but not so good at paying claims or expensive but can easily pay claims. I’d like to find something in the middle. I heard that independent agents can do the shopping around for you and get you a deal, would that be something you suggest? State Farm I hear is good but too expensive. If I was to do the shopping around myself, I have to get quotes from all of them and compare prices, is that how it works? Seems like it’ll take a lot of time.

@John Mocker it’s a single family home. It has an attached garage, 3 bedroom bungalow so 1 room upstairs and 2 rooms downstairs, 1.5 bathrooms, and freshly renovated (not sure if that even matters). Home also has a 770 sqft. basement as per records. Size of the home is either 1,106 sqft. or 1,337 sqft. because I’ve seen both on record. My guess is that it’s 1,337 with the breezeway (room between garage and home) and 1,106 without it but I’m not 100% certain. Home is made from that fake brick except on the side of the home where it’s real brick. The home was built in 1942.

@John Mocker hey John, thanks for the feedback. I don’t know any professional investors in the area that’s why I posted so I wouldn’t be able to compare with someone around here directly apples to apples. However, I would like to know what coverage and limits you’d suggest as a landlord. That way when I do go to an independent insurance agent I know exactly what to look for.

@Bala Apparao hey, thanks for getting back to me. How did you hear about them? Their rate seems to be really cheap for landlord insurance. How’s their reputation and do you recommend them?

@Sergio Aguinaga anyone?

Hello everyone, merry late Christmas (: I have a question. What is the best landlord insurance agency to get in east MI (metro Detroit area) to get a good price but also provides everything that’s necessary to protect me in case something happens, from liability to property protection. As an investor, is it better to get cash value or replacement cost? Thanks for the help everyone!