All Forum Posts by: Alex Silang

I am going to buy my first rental property soon. As many of you know, you need to wait 2 years for rental income to count, so I'm going to need to wait 2 years to buy that second properrty.

I was thinking of ways around this. Would I be able to ask a seller to refinance the house, then sell the property to me and let me assume the mortgage? This might also be a good tactic if you are at the Fannie limit of 4 mortgages.

Thanks!

Is it feasible to manage a real estate portfolio while overseas?

Thanks for the response Jon. I believe I read somewhere that banks will only let you take out 75% of the value of your equity.

I did some google research and found that banks sometimes offer no fee refinancings.

I guess my question is, would it be okay for me to refinance every 2-3 years? I want to expose my capital to compound interest as efficiently as possible.

What are the fees like?

Lets say you have 5k equity in the house you'd like to pull out. If it costs 2k to do it, it might not make sense.

Right now I am looking at how fast I can grow my business. Taking out equity is a critical part of it, but I need to know how often it can realistically be done.

I am also looking at Worcester for the same rental type. Daniel, is it okay if I give you a call?

I'm going to be at the meetup session in January. Hope to see some of you there.

Right now I am looking for a career change. My target profession pays significantly less (think 20%).

I have read on these boards that to get a mortgage loan they look at 2 years earning history. If I get a new job, do I have to wait for another 2 years?

If not, does anyone know what they would base they 2 years income on? Would they average it?

So most people who own their own home are only going to get approval for a single rental home. Exceptions to this is if you make a very good wage (six figures) or rental houses are cheap relevant to rents in your area.

Ugh, this throws a wrench in my grandiose rental empire plan!

I was running some numbers and one thing confuses me.

I've read that banks only allow people to take on a mortgage 2-2.5x their income. Rental income is added at a 75% rate.

Doesn't this limit the size of real estate empires unless someone is making a very high salary?

Lets say someone makes 50k year. He buys his residency at the maximum allowed at 2.5 x 50k = 125k.

He wants to buy a rental property.

$100k mortgage

$1500 monthly rent ($18,000/year)

$18,000 x .75 x 2.5 = $33,750. He is unable to buy the property because it is out of his limit.

I'm probably making a newbie mistake here. What am I overlooking? Are banks really that conservative?

1) Taxes - Uncle Sam needs to be paid

2) Cashing rental checks? How does that work, can you have the management company collect checks?

3) Keeping the management company honest, and switching if need be.

What else?

Alright - complete newbie question here.

Is it good practice to get pre-approved for a mortgage? And should I go to multiple banks to see what the best rate I get? Also is it worth trying an online bank?

Thanks