All Forum Posts by: Tony Lee

@Tony Lee

1. Yes

2. I invest in Austin. Cost is relative, it's about returns for me.

3. Where did you hear that? Austin is incredibly safe and so are most of the cities in Texas.

@Tony Lee the requirement to qualify for commercial is more focused on property performance than your wealth and credit. Also minor increases to the net operating income (noi) have significant increases to property value. An increase in noi of just $10 per unit per month on a 100 unit property equals $150,000 increase in value at an 8% cap rate. That’s how you force appreciation. Much faster than residential. 

Being approved for 250k doesn’t mean you get all that. It still hinges on appraisal. Like @Mike McCarthy said you need to force value or wait. Partnering up on your next venture is a good thought too. Also when you get  to 5 units and up the game changes to commercial. That financing is easier to get too. Value add is much more easier to accomplish and equity can skyrocket. 

@Craig Curelop

I live in Los Angeles and I think I forgot to mention that I’m a veteran so I think I get a deal on my first property. Idk if that changes anything.

Unless you bought that much under market, you won't have any equity to refi cash out. Did you increase the value through rehabbing? You are better off saving the 20% or raising the funds.

To answer your question, usually 6 months seasoning is required for a conventional mortgage.

But as others have mentions, lenders will typically lend only 70% (maybe 75%) on an investment property. And it’s based on the appraised value, which you can usually assume is a bit under comparable sales.

Plus, remember that closing costs add up, so unless you can pull a decent amount of money out, or get a much better rate, it can take a number of years to ‘pay off’ the closing costs on a new loan.

 Hi Caleb,

The home was appraised for $249,000

Doubtful a bank is going to finance 100% of the property. 

@Tony Lee did you have instant equity or not? If you don’t have instant equity refinancing won’t make much sense