All Forum Posts by: Adeva Edobor

@Manly Norris

Welcome to Bigger Pockets, Manly. Your middle name wouldn't happen to be Chuck, would it?

 @Vivian Sung Your comparison is not apples to apples that's why the question seems confusing. Don't compare the points compare the actual rate and down-payment. Your rates seem close because you are paying a lot of points on the 10% down option to get as close to the 25% down rate. If you have the cash, maybe do a 20% down, you'll avoid PMI and the rate difference may not be much between a 20 and 25. Will it cash flow enough to have breathing room for vacancy and repairs at 20%? If it will, I will go that route if it were me. ( I always try to put as little down as possible as long as there's enough cash flow to cover repairs and maintenance)

I bought my first property after a month or two of listening to hours of Clayton Morris. I was so sure I could cashflow in Detroit with cheap properties and high cash on cash returns. I found a property for $26k and made the mistake of letting the sellers agent represent me. (GET YOUR OWN AGENT) He gave what seemed like good guidance at the time, but knowing what I know now, I would have done better verification or got my own representation. The deal was too good to be true but he reassured me along the way. It was an easy process and everything was done sight unseen. The property already had a tenant(NEVER INHERIT A TENANT) who supposedly rented for $650/month and my mortgage, tax and insurance was around $317. I was going to cash flow from day one! The seller sent me an excel sheet of previous rents on time every month. It seemed all great. 

As soon as I closed, it went downhill. There was a repair that was noted during the inspection, the agent referred a contractor and told me it was ok to pay ahead of time (NEVER PAY BEFORE WORK IS DONE) I didn't think it was a big deal. I think it was maybe $400. The contractor stopped taking my calls as soon as he received the money. I had to pay someone else to do it. No big deal. Then the tenant was late on the first couple of months, then didn't pay at all for a few months after that. My property manager filed an eviction, right before she was evicted, she paid some of the back rent and asked to do a payment plan. I felt bad, (Maybe she was struggling financially) I didn't want to be the bad guy who put her on the street. She made the payments for a month or two then stopped again. The property manager filed and eviction again and the day before she was to be evicted, she moved all her stuff in the middle of the night including my windows, brand new heater and copper wires. Left the property like a dump. The management company sent her case to a collection company asking for $15k in back rent and damages. Nothing ever happened. I eventually sold it for $17k a few months later. No more long distance landlording for me.

@Emily Beck One way to go about it is to find a multi unit (2-4 units) and try a house hack (Live in one, rent out the others. You may be able to qualify using part of projected rents as part of your income. I think it's much cleaner than having someone co-sign cos you'll essentially be going into business with them

@Melissa S. Look up a lender who offers a DSCR, you will most likely get a higher rate but your income will not be a factor. The asset will just need to perform

@Account Closed It seems like you know the answer already. The 3 bedroom, assuming single family on one floor, will offer you more flexibility if you decide to sell or rent out in the future. If the parameters are similar, the 3 bedroom may be the winner in this bout. PS it may provide flexibility in the opportunity to expand to a 4/5 bedroom

@Skyler Heimer Look up Bank of America. I've heard they have a program. I don't personally know anyone who's used it but I've seen a lot of people talk about it on YouTube

Buy a Condo! It may not appreciate like a single family, but at least you'd be paying down a mortgage instead of renting. Make sure it needs some fixing (Nothing major) and the monthly payment is slightly equal to or less than average rents. Live in it for 2 years or so while doing some repairs, then rent it out. (Even if there's no cashflow after you factor vacancies and repairs) Now You can start afresh with another condo. In under 10 years, you'll have a few of these and the rents of the earlier ones should have some room for cashflow by now and maybe you'd see some appreciation but guess what, you'd have started your little Real Estate empire.

Hi @Alana Reynolds Did you make a decision? What did you end up doing?

@Brent Huling ARV is not a concrete value until after the repair. You should always allow the numbers on ARV to be flexible. Also, values can go up or down within the repair period, or you may get a different appraiser when you go to refi or resell. A 50k variance on a $1.5m should not be a deal breaker otherwise, your margins were too slim from the start. Appraisal is not an exact science sometimes, it's based on the appraiser's mood. So don't get bogged down by just over 3% in ARV. If that's the make it or break it factor in your deal, it may not have been a great deal to begin with. Maybe get a second appraisal, see how that goes