All Forum Posts by: Allison Karrels

@Account Closed - since you buy properties from people and not Home Union is there ever a possibility of seller financing?

@Account Closed - I have begun talking with Maximilian Howell - that is the fanciest name I have ever dealt with!!  

Goal is to buy 2 properties next year so I will be looking at Home Union as an option.

@Account Closed - does home union strictly sell/manage single family homes or are there possibilities of small multifamily

I was running the numbers the other day comparing stack vs snowball for my 4 rental property mortgages and I wondered if there was a 3rd option for debt repayment specific to mortgages. For a mortgage your payments change overtime from going towards mostly interest at the start to around midpoint of the length of your mortgage shift towards more principal and then towards the end mostly all principal . I wondered if it made any sense at all to pay down a debt until the balance shifted to more money went towards principal than interest and once that happens move to the next loan, etc. Example right now on a loan my payment is $582 but only $103 of that reduces the principal. If I paid it down until around $300 each month was going towards principal and then moved to a different loan does that make any sense at all. Or if I had $20,000 that I wanted to put towards debt - does it make sense to put $20k on one loan or $5 on 4 loans.

One reason I was thinking of this vs just paying off the highest interest rate loan and then moving to the next one is you can deduct mortgage interest on your taxes. So perhaps having 4 loans with some deductible interest has value vs paying off one loan and only deducting on 3 loans.

In case someone wants real numbers - Loan 1 - 4.75% $70,000 balance 30 years remaining , Loan 2 - 3.75% $70,000 balance 28 years remaining, Loan 3 - 4.125% $56,000 balance 15 years remaining, Loan 4 - 4.75% $94,000 balance 20 years remaining.

As you can see the interest rates are all within 1% of each other. I am currently putting around $700 a month towards loan 1 as an extra principal reduction payment but I was wondering if perhaps I should rotate which loan gets the extra payment each month or just stick with the normal practice of focusing on one debt at a time. I think since these are rental properties and there are tax implications the answer might be different than if we were just comparing credit card debts but perhaps not.

Welcome Eli - poke around bigger pockets - there is a ton of useful articles and podcasts about any area of real estate that interests you.  I am glad you found us here after listening to the podcast on Listen Money Matters - I love LMM :)

@Amy Wunderlich -

I spoke with Maverick and Philly a lot. Got preapproved and even reserved a duplex but ended up canceling the reservation. I could not get my husband on board with the Philly area. He didnt like the row homes or the crime rate and didnt feel like it was worth it compared to where we have been investing.

However, I was very pleased with my interaction with Maverick, their lenders and their partners.

Just 2 days after posting this part of the ceiling and wall on one of my rentals fell down randomly!  Where it fell is near the dryer vent so perhaps there is water leaking in from the roof or something but the tenant said there isnt water coming down just that the ceiling/wall fell.   Called insurance to go take a look and someone is going to look this week.  My deductible is $1000, so depending on what the issue is I am glad I built up the $10,000 reserve!  

I have bought 2 homes with MI and in contract with a 3rd.  They are a solid company and have so far produced good results.  

I have not heard of Elite Invest, however a quick look on their website shows me a ton of multifamily opportunities which you will not find with Memphis Invest.  So if you want to go the multifamily route Elite Invest could be a good choice.

Right now I am in contract to purchase my 6th rental SFH. I have been putting aside $100/month/property for a while now and have about $10,000 sitting in a cap ex reserves savings account so that I am prepared for those large random expenses. Smaller expenses just come out of my monthly rent. 2 of the 6 homes are mortgage free, so after all fixed expenses (mortgage, tax, insurance, property management) I cash flow $2,700 a month if there are no random expenses (which there always are).

Should I keep putting $100/month/property into this reserve account or at what point would you say I have enough in reserves and allow that $100/month/property go towards the down payment on rental home #7

Thanks

I just keep track of everything in an excel spreadsheet and I have 6 rentals