All Forum Posts by: Sung Park

@Ryan Stucke I find local lenders the best to work with rather than large national lenders. Build a good relationship with them and they will open doors to finance more complex deals later on. They also know your local market better such as titling, taxes, zoning, etc. those things matter for a smooth closing. I househacked using a conventional loan. Yes it required a larger down payment but an FHA loan is not competitive in high quality neighborhoods I prefer investing in. There too much competition from cash buyers and other conventional approved buyers that an FHA just won’t win in a multiple offer scenario. Something to keep in mind if it’s a seller market.

@Cody Whitten I recommend house hacking to get your feet wet. As for pmi, it’s required for fha with low down payment. If you do your cashflow calculation correctly, it’s just another business expense to consider. As long as the property cash flows as a stand alone rental property, your tenants paying for the pmi so it should not be an issue as an investor. Long distance purchases look great on paper and sounds easy but I decided not to because no one manages my assets as well as I do. I’m glad I didn’t when I had the chance because i have come to realize how quickly things can turn south if anything were To go wrong and it’s a big headache trying to manage long distance.

@Martha Michel I currently house hack with my wife and two young kids. My wife was totally onboard cuz the savings was too good to pass up. It's been the best financial decision for our family. We live in a great neighborhood so we're pretty happy about staying in the area. Good neighborhood attracts good tenants (most of the time) so we've had great tenants so far. And it's really easy to manage the property/tenants since I'm a few steps away.

@Michal Kolenda Based on your previous post, it looks like your located in IL. You should look into the rules for the city/state on where security deposit needs to be kept. States like PA require landlords to place the deposit in an escrow account, not a savings account.

@William Huston I doubt u can get a owner occupied loan where you put your primary residence in an LLC. Virtually all lenders will require title under your personal name. LLCs are overhyped especially if you have lIttle equity to protect. If you need asset protection look into an umbrella insurance first. It’s most likely cheaper and less of a headache to maintain. Don’t forget your state may require you to pay transfer tax if you place your property in an LLC as well.

@Timothy Howdeshell I would skip the MBA. The opportunity cost is certain (1 Yr of no Income AND massIve debt) but the pay off is not. There’s no guarantee you will make that income and even if you do, the amount of time and effort to achieve it will leave little for you to pursue Real estate which is what you really want to do. Don’t forget that this economic recovery is not going to last and you may not get the job u want at the pay u want when you finish ur MBA because you may graduate in a recession. If u want to increase your Income, find a better degree at a cheaper price or have your employer pay for it. I paid 30k for my masters, no loans, and got that money back with raises and bonuses in less than two years after finishing. Plus my employer paid for 33% of it.

@John Lee there are lenders out there who will lend to an LLC with you personally guaranteeing the loan. They will usually keep it in portfolio rather than go by Fannie rules. Don’t forget transferring title will likely cost more in transfer taxes in addition to maintaining the LLC. I suggest you look into it if it’s worth it. In many cases just getting an umbrella policy is cheaper and easier to do if liability protection is your goal.

@John Lee why not title to LLC in the first place?

@Lesley Resnick The pilot program was tailored to specific institutional investors, details that were oddly omitted by FHFA in the announcement. It was discontinued because it looks bad on fannie and Freddie. This has no impact to investors at large. http://www.mortgagenewsdaily.com/08222018_single_family_rentals.asp

Not sure how this is a serious issue to small buy and hold investors. Don’t most small residential investors show paper losses from depreciation? Why does this deduction matter if most of these investors have no net income?