All Forum Posts by: Tchaka Owen

Just Tchaka, I'm very informal. Owen merely indicates my Welsh background. :-)

They say you make your money when you buy. What that means is find a property below market that needs a little love. So if you buy that same $300k condo at $260k (with 10% down) and spend $10k on a little TLC, you'll be out of pocket $36k and have nearly 20% equity. Many see "playing it safe" as having significant positive cash flow. If you have to put down a lot in order to make it flow positive, it might not be that good a deal. 

@Isaac Rayne - before you make a purchase (or even start the process) you need to make a decision as to how you want to start investing. Do you intend to live in one side to start? Or do you want to have a renters on both sides? Given that you're starting out, you'll probably have more success moving in. Why?

Because then it will be seen as an owner-occupied property. You'll be able to get financing with a small percent down....for sure 5%. FHA might allow 3.5%. You'll also get owner-occupied rates (below 4%).

If you do not move in, it will be seen as an investment property and you'll need to put down 20-25% of the purchase price. Your rate will also be higher. The BofA quote you got isn't great, however it's not terrible either. Your agent is probably thinking owner-occupied rates as well. 

Lastly, even if you do have $200k liquid, why put a big chunk down when you can move in for considerably less? That leaves a lot more cash for other real estate endeavors. Good luck!

@Oscar Quintana - Thomas' post is spot on! The only difference I'd make is 2% for closing costs (seller doesn't have much in costs other than commissions and I don't account for 3% in concessions because my ARV accounts for that; to me, a concession is a change of ARV). But he did say his is a very conservative method. Either way, he gave an excellent explanation.

The problem you're going to find is that wholesalers are making the bulk of profits in S. Florida (particularly Miami-Dade). If you can find deals on your own (not easy), you'll be good to go.

I live in FL. 18 months ago I moved to Brevard after 18 years in S. Florida (most of it in Broward). IN is for BRRRR strategy.

@Cherise Bentosino - welcome to S.Florida! Yes, it's a tall order getting a 3/2 at $1800/mo, however it's not impossible. It boils down to WHERE you buy. FYI, South Florida is a megalopolis covering 3 counties and with over 5 million people. My first suggestion is that you buy no farther than 45 min drive from work. Why? Because time is money....do you want to sit in your car that much? 

Secondly, it's good that you're attending the no men allowed group on Wednesday; you should also go to either DREIA or BREIA (depending if you're in Miami-Dade or Broward). That's a good way to network.

Last bit (and this is key): S.Florida is likely the national leader in fraud, backstabbing, lying, cheating and every other nefarious activity. So be very careful as you proceed. Good luck!

@Adam Godfrey - astute FSBO's cooperate with brokers. In other words, they'll pay commission if an agent brings a client. Here's a suggestion: find an agent, tell him/her that you've identified a property already and would like 1% of the commission rebated towards your closing costs. Is that something they're willing to do (most will say "yes"). Then go from there. Note: it's important to find out if the seller cooperates with brokers. Good luck!

@Kenny Charles - what is the reason the attorney provided for getting a new contract signed instead of an addendum? 

The concern I'd have is that NJ has a review period for attorneys and that 1) could delay your closing, and 2) may be a way for the attorney to make more money. I'd ask the seller to find out the reason for a new contract AND to ask her attorney if he is charging her more to review a new contract (assuming she already knows the fees she's going to be paying and not simply trusting all will be fair).

@Joyce Jackson - you have to follow Florida law. Assuming your lease has a 5-day grace period, you have to right to post a 3-day notice beginning Feb 6th. You've been kind to allow things to stretch out. When you're ready to get things moving, post a 3-day notice on the door (take a pic), mail a copy to her address and email one as well. That way you are covered. If you do not have the funds after the 3 days are up (not including weekends and holidays), file for eviction. 

@Javonn Musgrove - IMO, you should work with one realtor. When you start out, interview a number of them and find the one you feel would be the best for you and stick with him/her. Working with more than one tends to work against you. Ie, agents don't get paid until a deal has been completed, so what's the incentive to look for deals for you if you aren't committed to said agent? Also, the MLS is accessible to all agents so one isn't going to find you on-market deals that another can't. Hence the need to interview.

Where you want multiple sources is wholesalers. Try to find as many good wholesalers as you can and get on their buyers lists. A lot of deals that pass across your desk won't be worthy, however you will get some that are winners. As an investor, one agent and a bunch of wholesalers is a great way to start out.

Good luck!

C) Do B and get a HELOC on the home so that you can still buy an investment property in 11/2020 if you want. That also eliminates the need to pay MI.