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Updated about 6 years ago,
How do I make this work? Should I?
Hoping you guys can help me clear this up its rattling my brain...
i have 2 deals in contract. Didn't plan on this but the second deal is too good to pass up.
FIRST DEAL-
Small 1br cottage, good size property (potential for future new construction) will be my first buy and hold. Will cash flow very nicely
Purchase $150k (HML 10% down 3 points 4 months min)
repairs $15k
taxes $6k
ins. including flood $2300
Rent $2100-$2300 (plus possible to create some extra income with property size)proper
SECOND DEAL:
COULD EASILY FLIP BUT CONSIDERING MAKING THIS MY RESIDENCE. Great area, great price for area will grieve taxes.
Purchase price $280k (HML 10% 3 points- 4 months min)
Repairs $13K
Taxes $15,500
Ins. $3k
ARV $500k (conservatively)
Heres where i need advice and knowledge...
Self employed my 2016/2017 tax returns are very low, although this years return will be much nicer thanks to my last flip and REI!
My credit score on KK fluctuates between 785 and 805.
I have about $110k I've saved and acquired over the decades plus a annuity to borrow against. Im using these reserves to fund the deals.
I will be closing on 2nd deal in a few weeks and the 1st deal about 6 weeks.
HOW DO I DO I KEEP BOTH?
HOW DO I NOT TIE UP ALL MY MONEY? I want to keep Investing in flips and buy and holds. I dont want my reserves tied up that halts me to a complete stop.
WHAT ARE MY BEST OPTIONS? Investment loan, FHA, Low money down, high money down etc? both deals are happening almost simultaneously. How soon can i refinance? Do i use a heloc on the second deal after its my residence?
I currently rent for $2300 all. I live well below my means. Have a roommate that contributes about a $1k a month. Taking the 2nd property as a residence will drastically raise my cost of living still inside my means but barely. I will then have a nice residence with a bunch of equity but im unsure if this is good financial move. Am I thinking financially or am i thinking emotionally? (Im dreaming of the pool parties haha)
CAN I HAVE BOTH PROPERTIES AND REALISTICALLY STILL HAVE ACCESS TO FUNDS TO KEEP INVESTING?
Thanks for any insight.