A Lot Can Happen in a Month (My Story Thus Far: Part 1)

[Ryan Plasencia]

Been really busy these couple of months trying to get everything together and I'm happily to say everything has paid of thus far.

If you were not aware I'm a freelancer and my main issue was I could not qualify for a loan because I needed to show 2 years of income of being a freelancer, meaning I would qualify in 2022 because I'm a recent graduate with a freelancing job. So even though my credit score was a 746, I had no loans/dept under my name and my income was good; I could not qualify.

I decided I wanted to to buy homes/duplex in the begging of January of 2020 and I made a goal that in 10 months (end of November 2020) I would start buying; so I did not want to wait 2 years longer.  Long story short I asked my boss (the company I was freelancing for) if they would hire me as a full time employ this was some time in June when I asked. They got back to me in July with an answer that they would be honored to have me but it came with a hard choice I had to make. 

I had two option to pick from; staying as a freelancer or becoming an employee. But there are pros and cons to everything. Ill start with the pros.

• Pros of being a freelancers:
  Could works past over 40 hours (I was doing 60 hours a week)
  Made high income vs being an employee
  Pick my own hours I wanted
  Worked from home

• Pros of being an employee:
  Able to qualify for a loan
  Able to still work at home
  Secure job
  Benefits 
• Great company

• Con for being a freelancer:
  Could not qualify for a loan and had to wait 2 years
  Paid my own taxes (I was ok with this though)
  Could lose my job at anytime
  
  Cons for being a employee:
  Salary Job only (Huge drop of what I was making)
  If I worked over 40 hours there would be no overtime
  still had to pay taxes regardless (not as much but still)
  Set work hours

This was a really tough choice for me because it was a lot harder emotionally than what you see from the pros and cons. I knew becoming an employee I would be landing in the middle class. There nothing wrong with that it's just I want more for me and my family. I'm not going to lie, yes it about money. But truthfully everything in the world revolve around money. For me I have big dreams and I need money to accomplish that. For example I want to make my own AAA game which is not cheap, make my future wife and future kids have everything they want and that just the tip of the ice burg. Unfortunately I have to start somewhere and what is more important. For me that was a secure job that I was able to stay with my family (my carrier requires me to move away from home and away from my family if I did not work at this job). But it's what you do after that makes it count.

For me I excepted the job, BUT I knew I wanted more and I was going to strive off that. I use this job as a stepping stone for my life. I planning on being here for years regardless; I love working here.

Anyway just 2 days before I went to my broker I told him I'm a full time employee starting on August 4th. He told me once I have proof of one month of income he can qualify up to 300k for me (keep in mind I qualified September 4th). 

Now let me just skip to the ending and then explain my self after. September 4 2020 I officially signed an offer on a duplex and I am closing November 5th.

I swear everything just fit perfectly in a matter of a month. 

So I had two realtors I was debating to go with. The first one was my neighbor and the other was someone I meet at a open house. They both were grate and I didn't know who to choose. Two weeks before I signed, I saw on Facebook that someone was selling there Xbox One (I buy and sell to make a little extra cash to help save up for a house/duplex). I message him if we can meet someplace to pick up the Xbox. Which we did at a local gas station. The thing was once we made the sale he told me to hold on. He went back in his car and to then gives me his business card (which he just got that day) and told me "I just got my realtor license are you looking to buy?" I remember looking at him and all I could think to say was "your a what?"

Right then and there I took it as a sign and decided to act on that and give him a chance. If it worked out we would be helping and learning from each other; and that's exactly what we did. I decided to make him my agent. 

I waited a week to start finally acting because I still could not buy because I still needed to get my loan approve. So one week before signing, I told him I was not ready to buy just yet and needed a few months to get a littlie more money. He completely understood and wanted to still look so he can get practice. I was not going to say no because I wanted to practice and look as well and finally get my feet wet. (This gave me the opportunity to really have a one and one with a realtor defiantly when I'm him first client so we both wear not wasting each other time)

I kid you not I looked at three homes with him all in one evening no more no less. We both wear excited and very eager. I said I would give an offer for each home to see if there would be any bites, but I would low ball each offer thinking I would not here back. All showing I looked at wear duplex's and each were completely different. 

The first duplex was the oldest of them all built in the late 1970's asking for 280k. It was nice but needed a lot of work and fixing up, so I offered 200k

The second duplex was built sometime in 1990's with a asking price for 265k. The duplex it self was completely renovated and needed little to no work. Only problem was it was a wood structure and I live in Florida wear we get lots of hurricanes which is an issue. I didn't really want this one but I still made an offer of 200k

The third and final duplex was the newest of all of them built in 2008 asking for 300k. There are some issues with the duplex but nothing to serious I could find. The place its self was very nice and I really like this one. I offered 265k.

Right now it's a sellers marking and I'm thinking there's no way I will hear back from anyone with my offers and I was ok with that. Well I heard back from the third duplex and they countered back with 285k saying I was the highest offer. I was amazed when I heard that because this duplex was very nice. it was a 4/4 (2/2 on each side) with a total of 2250 sqft. Everything was in great condition and was perfect for a small family. Huge master bedroom, big living room with an open kitchen plus a small den on each side. I could not figure out why nobody was offering on this. This duplex was on the market for 240 days so I did some research. Everything checked out; it's has city water paid for, comcast provided in the area, it was in a growing area, everything is near by, not in a flood zone. The only conclusion I could guess was there agents was very hard to get ahold of and he didn't post and pictures of the inside. I myself learned something here and maybe so can you. Ever heard of the saying "never judge a book by its cover" well the same goes for homes. Even if there no photo provided the inside can really surprise you.

[Brand new duplex here go for about 340k and older duplex that are fix up go for about 300k, I got this duplex for 280k. I'm predicting I can sell this house for 350k in the next few years. But not looking to sell anytime soon but if the price is right maybe]

Honestly I skipped over this duplex multiply time just because it had no photos of the inside so I came to the conclusion the inside needed a lot of work or was hiding something. The only reason we looked at this duplex was are realtor wanted to look at this place so he added onto just so we can have an extra showing. This was all thank to him and he really has been working hard on this to really make this happen (Thank you for everything).

Also I wanted to thank Bigger Pockets for everything I really learned a lot from this site and I learned maybe 85% of this under your podcast that I would listen to when I was working.  I'm trying my best to follow through everything you taught me. My goal is to live for free and do the house hack for my first purchase. I made this excel sheet that break down everything.

The top image is the exaggerated number with the least income possible

I will be putting 15% down with a little help of my parent to make this happen I will be paying them back but I will be very tight for the next couple of months, that is why I have no "Other Monthly Expenses" added yet. When everything settle down I will be adding to that. I did save up 15k for any fixing. Plus I was talking to one of tenant and they been living there for two years already and willing to do another year for the same price of 1200 a month (cant count on there word for that but I do have a plan if they bail). They are very simple people and are very clean. All they ask is for tile floor and the other side they dont live on has tile so everything works out perfect. 

Ill be doing lawn myself so need need to add that expense

Also I did the research and got the two hardest information I was having problems getting which are property taxes and insurance. Fortunately now I know how to get them numbers and don't have to worry as much as I have been since I know how to now.

Lastly the image below are the numbers I'm foreseeing and these are the number I predict will be more likely; but can easily change.

The monthly rent now is adding the 1200 from the tenant plus 200 for renting out the 2nd room on the side I'm living on, to my girlfriend sister.

The inflated numbers are now accrete from the quotes I've gotten.

As of now I'm very happy that I made this all possible in a matter of one months time from getting hired to signing. I made a goal of buying at the end of November but instead I'm owning a house before then if everything goes smoothly. Regardless if this deal dose not happen for what ever reason there will always be another. 

As my journey progress ill keep sharing.
Hopefully you guys enjoyed my story thus far.
:)