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All Forum Posts by: Alexandre Marques dos Santos

Alexandre Marques dos Santos has started 6 posts and replied 210 times.

Post: Noncollateral loan - too good to be true ?

Alexandre Marques dos SantosPosted
  • Rental Property Investor
  • Posts 215
  • Votes 137

@Joe Villeneuve

Joe, in my Heloc i pay interest on the usage. Its a %rate per year and py only in days used.

I dont see how pay for the line plus interest will be any better.

Lets see: i buy a house in 2 months regab and 3 months later i sell it:

I take heloc use 3 months pay back. Will pay 90/360 * interest. ( 90 is the 3 months i used)

LOC. I pay fees, then i pay 150 /360 * interest. ( i will pay 5 months and after that will continue paying interest till it matures).

In your example j get a sense i will pay more Heloc. Are tou assuming Heloc have a bigger interest?

Post: When will Rents goes up?

Alexandre Marques dos SantosPosted
  • Rental Property Investor
  • Posts 215
  • Votes 137

@Cary Ogello

I think whoever have rentals is surfing in a great environment. But as you mentioned prices have increased by 10-15%, and rentals only 5%.

So in margin numbers are not as good. Rates came lower and helps a bit, but as maintenance costs are on the rise, i fear this call for an adjustment.

Post: Paying off student debt vs. starting my REI journey

Alexandre Marques dos SantosPosted
  • Rental Property Investor
  • Posts 215
  • Votes 137

@Evan Dieffenbach

Dont get me wrong. I will be franc enough to put my perspective and give my opinion. Please dont be offended.

15 k will get you nowhere in RE. You might by a crapy rehab and get in more debt ( if a bank find you suit to receive it) trying to shape it and rent it. Then you will receive some money and... booom. A roof needs repair, a/c or else... and you have no reserves...

So you could try to save up to invest...yeap, you gonna make a killing receiving 1% py and even giving a big chunk of that to uncle Sam, while your debt is at 4.5% py.

Let me get to the point. Pay your debt is your best alternative at mom. You reduce the debt, start saving more, and finish it quickly. Then with no payments you can save more to start your RE journey. With less debt the bank will find you more suitable to lend, and rates can be more favorable. You enter in the journey with monthly savings, that could help you in an adverse moment in RE ( that always comes).

My post is not popular, but i am trying to give you the best advise on your situation. Hope you understand...

Cheers

Post: When will Rents goes up?

Alexandre Marques dos SantosPosted
  • Rental Property Investor
  • Posts 215
  • Votes 137

@Ola Dantis

Your words are summarizing my concerns.. while i call for the catch up btw rent and prices, its not happening. This is not sustainable in the long run. Landlords needs to have their profit as they run the risk AND keep places up for rentals. Their margin is being smashed and they are surviving only cause inventory was bought long ago. But MTM shows a different picture. Marginally many houses dont match most of the criteria. Its all over BP. Ao ppl now start to think they need to compress their margins. This is a mistake!

Rehab cost, maintenance cost is on the rise. Default rates are on the rise, so another cost in average. Obviously its not for all, but risk is on the raise...

Rates are low for owner, but investor dont get same lvls. Lets be franc, a cash out refinance rate is more expensive than owner rate. An investor is also more expensive. I have 825 FICO and trying to raise 70% LTV got average 3,75% and best was 3.5%. Thats far from sub 3% ppl point out.

I am not calling for a crash. But an adjustment. Either one or the other looks wrong. I really think economics are not supportive on the prices we are seeing...

Another factor.. lots of cash out buying houses might be “new RE landlords trying to make 5% against 1% in the bank. Not sure how long will that lst...

On the foreclosure, banks will renegotiate tenors and incorporate in the new contract what was not paid.. but if jobs doe not comes back, some of that will hit market., but at least this time prices favoured those owners...

Post: When will Rents goes up?

Alexandre Marques dos SantosPosted
  • Rental Property Investor
  • Posts 215
  • Votes 137

@Zachary Beach

I hear you. I just dont like the STR model, as it creates less stability in income, and i dont have much time to focus on managing it. Maybe i will vive a shot in the future, but its not for me at mom.

@Jeremy Bailey

I would keep it. You are investing on your target, a nice retirement. The biggest question is how much are you paying in interest on your old mortgage. And if you are willing to buy more properties ( and deal with management). If thats the case, refinance and cash out. A cash out will cost you some 0.5%.

Why dont you take a Heloc instead? With this amount of cash flow, you would quickly pay it down. And banks offer Heloc with no closing cost! It could save you something like 2k... take 115 k Heloc and pay mortgage, then cash flow pay it down. Save you some closing cost, while accessing a better rate... and not sure if it will be more expensive then cash out refinancing an investment property.

Another alternative, you can reinvest the proceeds towards to pay the debt ( doing a recast), increase the cash flow and then so you will pay it quickly... accumulate and buy a property with financing. It will take longer. But having low debt and monthly payments will help you to finance with low rates...

Post: To many people in RealEstate ?

Alexandre Marques dos SantosPosted
  • Rental Property Investor
  • Posts 215
  • Votes 137

@Ravi Ramphal

There are many opportunities out there... it will always be there.. but yes, too many ppl involved with no clue where they are getting into...

Like Rockefeller said “ when your shoeshine tells you he bought stocks, i wonder if its time to sell”

@Jeremy Bailey

How much equity do you have? 113 k? If thats the case, 15 k over 113 k is a pretty good return. Knowing your place ( low or no surprises) is worthy a lot. I would keep it.

If you own it all and its worthy 350 k, then return is not great. A cash out cost (someone gave this idea) would “tie” the return, so would not give a nice return. Just work and risk. Not worthy. So in this case, having where to park the money with a decent return, i would sell it and look for a better opportunity... if you dont have where to park, you are making 4,3% py... better this than 1%... accumulate some cash and get ready to buy your dream retirement...

Post: When will Rents goes up?

Alexandre Marques dos SantosPosted
  • Rental Property Investor
  • Posts 215
  • Votes 137

@Shahriar Khan

Thank you. You mentioned something interesting, actually ( following previous post), Theres no growth in general rent, but in specific places ( Teresa mentioned in one region), and you mentioned inner cities.

So generally speaking margins are getting a hard hit. Prices going up, rentals stable ( not mentioning California or other regions), maintenance going up, and loses for credit in margins going up...

Challenging scenario to invest... need to be extra careful with new acquisitions...

Post: When will Rents goes up?

Alexandre Marques dos SantosPosted
  • Rental Property Investor
  • Posts 215
  • Votes 137

Elias, that's exactly my point.  rentals suffers to get an increase.  you can get some, but marginal compared to the price paid.  But this range does not offer a great return... unless you get tenants forever (no vacancy at all) and can keep maintenance at lows... Even in this case, return is getting closer to 5%... and Joe, i dont know how can you get, as investor below 3%.  i have almost no debt and have been having hard time to even get a 3,5%, in an INVESTMENT property.