All Forum Posts by: Amy H.

@Jim D. Great point, I definitely still cash flow if I take out the full 75-80%. I guess the thought of unknowns (drop in rent price, vacancy, etc) scare me a bit. But I guess that's where my reserves and W-2 job could save me if it really need to. Might as well take advantage of the money they are willing to loan me at a low rate!

@Mike Dymski That's a great point. As long as you have reserves for those, you can survive and also scale well. Point taken!

@John Pierce One lender said I could do 75% but my go to lender said she could do 80%. My rental is in Hanover so it’s around $200k now. Just not sure if I should take out every dollar I can and only cash flow $150-200 a month after all expenses. Or get a lower mortgage (and take out less cash) so I cashflow $500+.

I just can’t figure out what my magic number should be. Somewhere in the middle I assume, wasn’t sure if someone had a special formula or method to deciding a good number.

Forgot to mention I am in Richmond, Virginia. It’s currently a conventional loan.

I’m begun evaluating a rental property that I own for a cash out refi.

I know people will say I shoot for X% for me to want to do a rental deal initially. But is that before or after the cash out refi? Is there any ideal Cash on Cash return that you shoot for to decide how much you take out for the refinance?

Do you take out enough just so you can to cash flow X amount or do you just take out all your cash/the most you can? Do you shoot for the highest CoC return possible and risk having more cash tied up or pull out the most cash you can to have more money for your next investment? Do you do a mix of both of those? What's your goal that you go for?

For a bit of a background- we are trying to buy at least 1-2 SFH a year. So I'd like to pull out money, but also trying not to be so over leveraged. I wanted to get ideas from others of a good balance between having cash to invest and not being over leveraged.

@Tomiko Graves if you can DIY; I would for that price point of a house. The bathroom of my rental looked identical with the layout and tiling late last year. I rehabbed it myself for under $1,500.

@Ryan Roesch Have you reached out to the mortgage lender yet? I work for a mortgage lender and we process these requests all the time. It automatically comes off usually but technology can fail us once and a while. They aren't purposely charging you (the money goes directly to FHA, so it's no gain for them). Just write a letter requesting the removal of PMI.

I know some FHA loans PMI is never removed. He would've been told this information at the closing table by his loan officers.

Let's not jump to the conclusions that the mortgage company is the bad guy before we even ask via a written request to remove the PMI :)

@Minnae Chabwera I have to agree with @Taylor L. @Bill Hancock. I invest north of Richmond (Hanover county and Henrico county) and the market is super competitive right now. I’ve been outbid by investors and homeowners a lot these last few months. Multiple (5+) offers on a lot of houses in less than 24 hours well above list price. We just went under contract on a house in Henrico county a month ago or so and had to bid $5k over list with cash to win. We also lost to another house that ended up going $19k over list price a few streets over two months ago.

There’s great areas near the universities and monuments as you spoke to earlier. They are very sought after and expensive.

I feel like the 1% rule is difficult here in the type of neighborhoods I invest in, but always deals to be had just like in every market!

You just need to narrow down what type of neighborhood and tenant you are going for.

@Joshua S. Congrats! I work for VHDA so I love hearing success stories that involve using our loan products. Reminds me why I work in affordable housing in the first place. 

@Chris Lubrano I have a few friends here in Richmond that are in the insurance industry and work closely with All Risks in the E&S side of insurance as one of their brokers. I agree with @Jason Bott in his recommendation to really understand what the policy would be covering.