All Forum Posts by: Ty Coutts

Also, I am aware that there is an FHA rule for four plex's. I think that the rule says the monthly rent of the other three tenants must exceed the monthly costs of the property. I think I have this right, but I would do your own research as it may be a large factor. It popped up in my mind and I thought I'd share.

My apologies for the misleading post, I see how what I said was misinterpreted. I was more so saying that after a year of occupancy period, you could explore options such as a property manager to take over and you could move onto the next investment property. Yes, DO NOT claim you live there when you do not, this is indeed fraud. 

Hey Johnathan,

For a 3BR 2BA home near Lafayette College in Easton, PA, you can expect to charge around $2,185 per month for the entire unit. Renting by the room could yield $800-$1,000 per room, totaling approximately $2,400-$3,000 per month, depending on the property's condition and amenities.

Average rents in Easton show one-bedroom apartments at $1,618 and two-bedroom apartments at $2,425. The College Hill area averages around $2,082 across all unit types. With a 4% increase in rental prices over the past year, investing in student housing near the college can be a lucrative opportunity. Feel free to reach out to me through DMs if you have any other questions, or if you would like to talk financing!

Nicholas, as long as you live in one of the units for at least one year, then you should qualify for an FHA loan. The other units are free to be used as rentals.

Hello Kenji. I'm not too sure about what the circumstances are like in Belgium, but it is possible here in the States. I would research FHA loans (or whatever the equivalent is in Belgium.) Basically, you can receive a very low, and assisted, down payment on your home. Additionally, you'll have access to less competitive rates, usually.

For this to be possible at your age, you are able to have a parent co-sign and use their credit, income statements, etc. This allows you to close and begin generating passive income while you are still studying. I hope this finds you well, good luck!

Hello Paul,

As the legal owner and borrower on the loan, you may be eligible to deduct mortgage interest and property taxes on your tax return. However, this situation is complex due to the family arrangement. The IRS generally allows deductions for second homes if you use the property for personal use for more than 14 days or 10% of the days it's rented, whichever is greater. Since your family member is paying the PITI, there could be questions about whether these payments constitute rental income or gifts.

If you're the legal owner, proceeds from the sale would typically go to you. However, you would also be responsible for any capital gains taxes. If the family member passes away, the property would remain in your name unless other arrangements are made.

Given the complexity of this situation and the impending closing date, it's crucial to seek professional tax and legal advice as soon as possible. A tax professional can provide specific guidance on how to structure this arrangement to comply with tax laws and maximize any potential deductions. They can also advise on the proper way to report this on your tax returns.

Hope this helps,

Ty

Given that you plan to live in the South Carolina property for 2-3 years before turning it into a rental, I would lean towards using the HELOC for the down payment and getting a traditional mortgage. However, this recommendation could change based on specific interest rates, your personal financial situation, and long-term goals. I strongly advise consulting with a financial advisor or real estate professional who can provide personalized advice based on a comprehensive review of your situation.

Rein, 

First, understand legal framework and financing options first. Then, I would assess the income potential using each option. Remember, mobile home park investments can be complex, especially for first-time investors. Take your time to thoroughly understand the opportunity and don't hesitate to seek advice from experienced professionals in real estate investment and mobile home park operations.

Hello Tyler,

For a more short-term strategy, I would consider holding off on Refinancing Property 2. Given the high interest rates and the need for additional cash, it might be better to wait until market conditions improve. Consider using the $100,000 as a down payment for a new primary residence. This would reduce your monthly living expenses and allow you to build equity. Explore FHA or conventional loans based on your eligibility and current market rates.

For a medium/longer term strategy, keep an eye on interest rates for potential refinancing opportunities for Property 2 when rates are more favorable. Focus on building equity in your new primary residence and continue to manage your rental properties efficiently. Once you have stabilized your primary residence and rental properties, consider additional real estate investments using the equity you build.

I hope this helps!

Hey Andre,

To complete your DADU project, you can use your $227,000 HELOC and consider getting a construction loan for the additional funds needed, such as $100,000. This combination would cover the total cost of the build. Once the DADU is finished, you can refinance your property, ideally through a cash-out refinance, to pay off both the HELOC and the construction loan. This would consolidate your debt into a single mortgage with better terms. It's a good idea to talk to a lender to ensure you meet all the requirements and get the best deal, so if you want to discuss please feel free to reach out to me directly!