All Forum Posts by: Account Closed

This is 100% feasible. In fact, if you bring me a good deal I will be your first customer in line. 

Quote from @Christina Gray:

Thank you all for your advice!

Lots of mixed messages. I'll just say that it's possible to both fix your credit and finance a property simultaneously. You CAN invest your way out of bad credit. You know what solves credit problems? CASH FLOW. Watch how quickly your credit problems go away when you are making on time payments with $400 extra cash flow per month. As for your options now while your credit is suffering…private money, hard money, seller finance, prepaid PMI, assumable mortgages and sub to all come to mind.

I operate a few mid term rentals and my target audience is traveling nurses on 13 week contracts. Here is my playbook….

I open up my calendar for 4 months in advance. I make the minimum stay 90 days. I allow for immediate bookings. I set the rate a a price point such that 90 days of occupancy during that 120 day period creates the cash flow that I need for 120 days. If you can book back to back rentals you’ll do great but this protects against your downside. If you haven’t booked someone in 30 days doing this then you’ve got to adjust your rate or your ad. Assuming the property is appealing, this should get you going. Best of luck!

Quote from @Brian Tran:

First , thank you for sharing and that will push me work harder to grow . second, Can you explain more about many time that you can use only 5% down again and again ?also with new build ,  I never have any chance to have that down payment, always 25% down for my investment ( I am begging them 20% they never agree from 2013 till now ) and 20% for my residence. Under 20% have to pay mortgage insurance ( expense add up ). So are they still cash flow positive with that low down payment ? 

Brian we did not use anything but owner occupied financing here. When you owner occupy for a year first, you can get conventional financing with only 5% down.  That’s not the case when you purchase an investment property. 

Quote from @Chris Seveney:

I am curious what this looks like now and what it will look like in twelve months from now.

At the current moment it’s still working out beautifully. The rents support the mortgages and we’ve pulled equity out to keep a solid liquid position to absorb any kind of disruption. The properties themselves are in great shape physically. While we expect some sort of hit to our equity position in the next 12-24 months, we’ve gamed that scenario out to protect the downside. All we can do is adapt and act decisively given new information right? 

Quote from @Aaron Poling:

Congratulations on your Success! The one thing that I see holding many people back is trying to plan every single move out in advance. In this business it is good to have goals and a plan but you have to adjust and go with where the opportunity is along the way and it seems that you have mastered that! Thanks for sharing your story! Aaron

If I could give anyone advice in that regard it would be that your should never be concrete in an ever evolving market. Glad you enjoyed the read!

Quote from @Tyler Solomon:

Amazing story - and incredible timing! Congrats, I thoroughly enjoyed reading this

 Thank you! It was a roller coaster!

DSCR loans are capital intensive and typically not a great product for new investors. You have to put enough money down to make the property's ratios attractive to the lender. This can typically be more than 25% down in the majority of scenarios. Think of it ask a less levered approach to quick capital.

This depends on ton of factors. If you’re buying with cash you can assume a cap rate between 4-6% depending on the area here in Phoenix. 

Quote from @Mike Dymski:

Great stuff.  Financing was key to your success.  Please walk through the programs you used to execute repeat 5% down payment acquisitions.

Hey Mike. We bought everything as owner occupied with conventional financing on a 30 year loan structure. There was nothing fancy to it. When we ran into issues with our DTI on the first few we reached out to a mortgage broker who knew just how to handle it.

Once we had 2 years tax returns with the long term rentals the DTI became a nonissue because they all had positive net income in the first year. We limited our depreciation deductions strategically by capitalizing purchases to spread them out as much as possible giving us a higher bottom line on our schedule E. 

With the condos we ran them as mid term rentals to boost our net income. I signed an annual lease for his properties and then I sublet them. When it came time to finance them he had an annual lease so he didn’t run into issues with short term rental income being disqualified. 

Hope this helps!