What I have been up to and ways to more effectively move forward. BRAINSTORM

[Ethan Clay Lesperance]

I currently have 4 properties, 3 being rentals and 1 as a primary. Im learning as I go but here is what I did.

The very first house AKA house 1 I bought back in 2011 was a foreclosed property that i purchased for around 74k if I remember correctly. It was an ARM and the payment was $291.38 lol, ill never forget that. Anyway, I was in my very early 20's and i was in a position to rent out a couple of the rooms in my house to some friends. I later learned, this is called "house hacking". The mortgage and all the bills were paid by the rent i received from the tenants. I lived for free and did just fine waiting tables! I also always worked in construction in some shape or form (i grew up in it) and frankly I just love doing the physical labor. So life went on and eventually I met a mentor and started learning a little about real estate. I had already been doing projects on the house and over the course of about 8 years I had made quite a few improvements. So fast forward to year 2020! Life happened and I needed to move out of the house and it just so happened a there was a house being sold wholesale "as-is" a town over and my mentor suggested i buy the house and live there while i fix it up. Ill call this house 2! So, I borrowed the money from the person that stayed in my first house as she had just sold her house and made a fair amount of money off of it. I borrowed 62k at 10% APR for 12 months with interest only payments and a balloon payment at the end of the loan term. The house i was purchasing was was a 2 story 4 bed 2 bath around 1900 sq ft. I moved in with no heat, no water, and a very poor electrical situation but by this time i was working for my mentors construction company and had an abundance of resources at my disposal. I flipped that house in 7 months and refinanced it and made right at 130k if i remember correctly. I then paid back the lender and decided to make some more improvements on house 1 because at this point I'm realizing house 1 could be worth a pretty penny. So anyway, I sunk another 30k into that house. New roof, new siding, concrete patio, retaining wall, deck, windows....made it look nice. That house appraised at 275k dollars!!!! NUTS! I did a cash out refi and took out 100k! This is where things get interesting and fun. Mind you im making like 30k a year working construction at this point and im absolutely still not totally believing everything thats happening. Oh yeah, back to house 2 real quick, i added a 2nd bathroom and since all the rooms had door ways meaning it wasnt an open concept floor plan, i was able to add a 5th bedroom. i than started renting out every bedroom in that house while mainting one as my own. It pulled in 600 a room x4...thats 2400 a month and again im living for free! Ok, back to the 100k. Im now sitting on more money than ive ever had in my life and i have no idea what to do with it! My mentor with the construction company did though. Long story short, I loaned him 100k :) at 10% APR for 18 months with that balloon payment at the end. Thats a $1000 dollars a month in interest if youre mathing! Quick recap. I now have 2 houses both in conventional 30 year loans and i have 2200 a months in mortgages in my name but im doing ok cause im cash flowing pretty positive on the monthly. SOOOO some time goes by and im fairly comfortable with where im at and decide i wanna but the neighbors POS house. So i knock on the door and offer them 80k for the house AKA house 3. it sits on about a half an acre that is adjacent to house 2's half acre. If they accept, i have a 1 acre corner lot with 2 house side by side. They accept! At this point i have no idea where im getting 80K because my 100k is ties up... but I have some freinds. Very wealthy awesome people and they really like me......SOOO i explain the situation and they see my track record and BOOM I borrow 80k @ 10% APR interest only payments for 12 months with NO EARLY PAY OFF PENALTY (bless them) and i fix up the house and get a renter in there. This did not go well!! renter sucked...didnt pay.... cost me a lot of money blah blah blah. Thats a long story! anyway i got some new renters in there and thats going well now. This house is where i learn about a DSCR loan and i just got the appraisal back at 173k and i close next week. ill pull 75%LTV and make around 129k. I technically owe nothing on this house and heres why. Its now 2023 btw. Amidst the process with house 3 I find another wholesale property on 5 acres in the country and i love it. I want it! where am i going to get the 140k to buy this place??!! I call the wealthy friends again! Although they had just loaned me 80k 10 months prior and im in the middle of refinancing house 3 to pay back that 80k, they agree to loan me another 200K to purchase the property to both purchase the house and have some extra money to help with some of my own money to make make renovations. The stipulation here is that I stop the refinance on house 3 because house 4 is also an absolute POS and its not worth the 280k i now owe these kind folks. So we draw up some legal docs and now both house 3 and 4 are collateral for the new loan total of 280K @ you guessed it, 10% APR Interest only payments for 24 months this time. So i fix up house 4 in about 7 or so months and it appraises at.......375k!!! But i cant refinance this one cause my DTI ration looks absolutely terrible and so im wondering wth im gonna do. I have time, about a year before i have to pay back the 280k. So... I try to refinance house 4 and it doesnt work and thats another long story but i went through a broker and they royally f'd up IMO. So as soon as i realized this ismt gonna happen i make some adjustments. I call the nice wealthy frineds and explain that house 4 is now worth enough to more than cover the loan amount and they agree to sign a release deed for house 3. Remember house 3? so again this is where the DSCR loan comes into play. Ill be getting that closed up in about a week. Then i have to figure out how to Refinance house 4....but i got till june 2025 so i think im good. Questions? Comments? Concerns? Guidance? Talk to me! Ill help clarify all that confusion above if youre interested enough!