All Forum Posts by: Andre P.

I can't speak about VA loans, but you can only have one FHA loan at a time, so you'd either have to refi the existing FHA loan, or qualify for some other type of mortgage product.

I'm confused by a number of things (perhaps partially b/c I utilize my own spreadsheet) so I'll just start firing away questions...

Is this property currently vacant? How long is your rehab going to take? Have you factored in carrying costs during your rehab? Are you doing this with none of your own cash (nice if you are)? If so, do your lenders know that, some may balk depending on other factors.

I notice the monthly income is about $650 more than it currently rents for- I hope that number is supported by comps in the area, and I'll assume it is.

How do you plan to pay back your investor? Using your pre-refi number after your interest only payment, you're making about $300/mo. After 18 months that's not even $5500, where's the other $20k coming from?

Your refi is for $90k, why? In order to pay back your investor if you don't have cash on hand your cash-out refi would need to be for $125k, not $90k.

The initial equity on the top of page 2 isn't correct- assuming your ARV is $160, your equity would be around $60k, not $85k.

Still looks like it could be a good deal, I'm just not understanding the assumptions in the spreadsheet.

I see two options...

1. Is your current home something that could be rented? Just save up for a down payment on a new place, and move after you have renters for your current place.

2. Sell your current place when you move and house hack your way in to a small multi family, then save for your next place from there.

I agree with others, your math isn't making sense, this statement "50+ houses would in fact net me $500 a month if I spent 50k total and have $1200 coming in" is a complete mystery to me.

I think a better estimate for you to use would be perhaps $100/month/door of profit, and even that could vary since I have no idea what your market is like.

I salute your determination, just be sure you're being realistic along the way!

How are you going to buy these houses? That right there can dictate a lot of how "creative" your offers can get.

Only you know the answer with the information you've given, here's the basic formula:

ARV - purchase price - rehab costs = Profit

You need to know how much the rehab is going to cost to know if it's a good deal or not.  You mention the owner has paid $70k on the mortgage but that isn't a number that matters (since who knows what interest rate he's on or if he's made any extra payments), what matters is what the outstanding balance is on the mortgage and can you offer them a purchase price that is A) Fair to the owner, B) Helps them sell with some amount of equity and C) Gives you room that it financially makes sense.

The numbers change based on if you want to flip it or rent it, making the question "does it make sense" different based on the direction you choose.

In short, I have no idea how much I would offer...

@Christian Bors is right on with investigating the HOA- if they don't have any money and need to fix a roof, they are going to come calling for a large chunk of change. Do your due diligence for sure!

I also like the advice @Chris Mason gave, putting some money down is probably a good idea and then use the rest as a cash reserve until your cash flow gets you in a safe place.

Neither of your links appear to work (at least for me), try just posting them here.

 As someone who works in IT and has, and currently does, manage these types of connections for businesses I can say there is no residual cost for the next tenant. That's why the install costs $50k, from that point on all it takes is someone to either turn the connection on/off from the provider. The current tenant will manage their use of the service until they don't need it anymore.

Think of it like any home-based internet, once the cable is to your house, there's no additional costs except for your service.

That option being available for the next business that moves in could be a huge selling point, since they don't have to spend the money to get it installed should they want it.

 No national chain of any type (or most business of any moderate size) wants to run their business off a DSL line, since every second of downtime can costs huge dollars they are probably looking for business class, fiber-based service potentially using a provider they already contract with as part of their IT services.

I'm in agreement with others here, add the 50k in monthly installments over the course of the lease and thank them for the improvement to your building.

I'm sorry to go off topic but this is an outlandish statement, by that logic if your neighbor burned down their house and yours because the grill or fire pit was too close are you going to sue the fire department?

Police in this country have to base their investigations on probable cause especially when it comes to entering someone's home or property, which requires a warrant from a judge. This cannot be based off the word of a neighbor, who most of the time just doesn't like someone and is trying to use the cops as a tool to get back at them. I know this first-hand as I just recently retired as a police officer. If you have a legitimate complaint try helping your police department instead of threatening to sue them- like any other organization you'll probably get a better response.