Buying First Multifamily House No mortgage House Hacking Strategy

[Ricky Williams]

First i want to say hello to everyone i am so grateful and appreciative of this site and everyone that takes the time to educate and spread knowledge freely here.

please excuse any mistakes or errors from my typing i am not that great with a computer once again my apology if you guys come across any typos or errors take it easy on me 

I am a newbie to real estate investing i am from boston mass my background and experience is in construction for the last ten yrs and i worked on and off on crews i worked property management and also i worked on crews were we rehabbed flips for investors so i am familiar with house flipping and how it works and i saw the big guys make money and i always had my sights set that the first chance i get i got to secure some property of my own you know 

Not getting too much off the topic but i was fortunate enough to inherit a good little amount of funds to get my feet wet and step off the porch but i suffered a great loss 

I read tons of books i listened to tons of webinars here and all over the internet 

and i said its my time now i said a prayer and decided that the route i wanted to take was house hacking  

my credit score wasn't that great but i paid of all my debt wasn't much under 5k and i started to work on rebuilding my credit 

i then started my own property management business back in october/16 and i am determine to grow it but its tough starting out trying to land accounts

I sat down with a banker and even though i had money in the bank he said i would have to show 2 yrs of w-2 statements and decent credit and solid steady income to qualify for a fha loan with 3-5% down my business is too new 

So i went back to the drawing board and decided if went further south of boston i did the homework and ran the numbers i could secure a multifamily for under 200k i could possible make things work but i needed it to be on the low end of the 100k range in order for me to afford to possibly renovate and get rents and not run out of money because realistically 200k is all i have i figured i have to take that risk 

i don't have any kids jus a fiance whats the worst that can happen right lol  

so for the past five months i set out on the hunt for a foreclosure but it had to be a multi because the plan is to stay independent with no mortgage was the only way for me to succeed at trying to make it i want to own and manage all my own properties i don't want to sell anything buy and hold i strongly believe passive income is the best way to build capitol and build wealth to grow 

sooooo finally after these long hard stressful five months were i was only able to find only 5 house that could work and that i could afford for my situation that i was looking for and losing bidding wars to people with more money than me and everytime the bank said submit your best and final and my realtor calling me and telling me you didn't get it ....

i was deeply discouraged that the reality was i didn't have enough money to land a bargain because affordable cash deal was selling fast cause everyone is looking to invest right now     

but god answer my prayers and i was able to submit a offer on a house that was listed for 150K and after going back and fourth with my realtor and bank they finally agreed to a purchase price of 125k for a triplex 3600 sq. with also a inlaw unit that i could also rent out for making it a total of 4 units i can't believe it i am undercontract so i hired a real estate attorney to handle the deal and i am currently waiting for company to come out and dewinterize the house so i can do a walk threw with my contractor who is my old boss and friend and then i will be getting a home inspection i believe and moving forward to signing a purchase & sales agreement i don't have a exact closing date yet but i am expecting to do a 14 day close 

also the house needs a lot of work and its in a b /b- neighborhood and i have to do tons of renovating but i still have a cushion to get some renovations done 

125k purchase price +50k brings all the mandatory stuff i need up to code electric/plumbing/boiler/ etc ... and renovations 

i will be into it for 175k is the plan 

25k left over as my pincushing 

but remember i will be house hacking so i will be living there and perform most of the renovations i can myself and i will do over units that i can with my budget so i can bring in rents

The number one thing is i don't have a mortgage so i won't be under pressure with a mortgage payment every month and this would be a great starting point to build capitol for next rental multifamily investment  

i will only have to worry about land taxes+homeowners insurance+plus water cost 

i would like any feedback if any thoughts and advice from experience people and also opinions 

on my strategy here and once again thanks for taking the moment to chime in on my experience ....   

4 unit

3bd/2bd/2bd/1bd-studio

3bd in that town rents between 1000-1500

2bd rents between 900-1300

1bd and studio rents between 750-1200

this property is a potential win 

please get back to me with any positive thoughts