All Forum Posts by: Corbin Jones

@Marcus Auerbach I am not relocating to Milwaukee. I wish I were, but I’m just waiting for my employer to relocate me to a less expensive area than New Jersey so that I can finally owner-occupy a home instead of renting. Hopefully that will be in the Midwest. I’m just preparing ahead of time. Thanks for the tips. Are there any legalities, rules, or procedures for renting out unofficial units, such as an attic unit?

Thank you, @Seth Williams!!

Hello,

I have a few questions regarding using an FHA loan to finance on a fourplex. I've read plenty of blogs about the benefits of FHA & conventional financing to house-hack and owner-occupy properties. I currently have a single-family unit in Milwaukee, but I would like to house-hack a fourplex soon through an FHA loan. I have a W2 job that supplies me with $65K per year, and my current rental unit supplies me with $9K in gross rent per year. I have zero consumer debt and no car payments, as I have a company vehicle.

1. When applying for FHA financing on a fourplex (or duplex/triplex), how can I utilize the gross rent in the actual qualification? What if the fourplex is currently vacant? If there are tenants, can I use those rents as qualifying income toward my qualification? How does this part of qualifying work?

2. How can I figure out how much I'll be able to qualify for? I would like to get a rough idea before I go and take a hard hit on my credit from a bank.

3. Where is the best place to locate multifamily units? I love Trulia and Zillow, but it seems difficult to find good units on that site. I have checked out Loopnet a little bit.

4. What is a solid cap rate for fourplex investments? 7% - 9%?

I look forward to your feedback, and let me know if there is anything else that I may have not asked about!

@Kerry Mertz Hey Kerry, thank you so much for the advice! I think I'll give it a few months and then give her the option for a longer lease. She has stated that she is open to different term lengths at least. She also seems to be a great tenant by her work ethic and profession, so time will tell.

Hi all,

My question regards month-to-month leasing. I have a tenant in my newly purchased rental property and she's been on a month-to-month lease for the past 5 years under former ownership. Do I need her to sign the lease every single month? Or is it fine to just have her sign it once unless something changes?

@Mike Koscielak Hi Mike, I like what Michael Ealy had to say. I learned something new about gaining that line of credit. I would stay away from risky stocks. I used down payment funds last fall (16K) and ended up gaining 4K on that amount in the stocks, only to end up down 1K after the whole stock market mess in September/October. You could put it into an ETF, CD, or mutual fund possibly.

@Dennis Elverman Hi Dennis! How were you able to put down 5% for your single-family home? Was that conventional or FHA?

@Brie Schmidt Thank you very much!

Hello all,

I just closed on my first property (single-family home) in Milwaukee, Wisconsin, and I will be managing the property myself. The tenant has lived there for five years and has been very reliable. The least appealing part of this whole process is the accounting and taxes. I am great with people and I enjoy making my own decisions in real estate investments, but numbers can overwhelm me. I have no idea where to start with tracking expenses and income and ensuring that I am properly preparing myself for tax season next year. Do you have any suggestions on articles that I can read or spreadsheets that I should use? I need to learn the basics of handling taxes so that I'll be prepared for tax season next year. I understand that there is landlord software available on the web, but $40/month for software would not make sense, seeing that I only own one property. Thanks for the help!

@Amanda Aesho Hey Amanda! Have you thought about investing in properties up in Milwaukee? It's just a short drive away from you. I just closed on my first property on Monday, and it happens to be in Milwaukee. I live in NJ, but I can't afford the homes out here, so that's why I chose to invest in the Milwaukee area. You can find a good tenant if you screen tenants well. There are some really good articles on this site about screening tenants. I'm managing the property myself, but the reliable tenant has been living there for 5 years and I have some contractors and handymen lined up in case something goes wrong since I live so far away.