All Forum Posts by: Bill B.

@Bryron Diaz

2 quick options:

Are you currently renting? If so, you could buy a house as your primary and have someone rent a room or level of the house. (House hacking)

If you currently "own" your primary residence (even if the bank owns most of it.) you could move to a new home as your new primary (better rate and terms as a primary and you could put less down though I would still suggest putting 20% down to avoid PMI) and rent out your current home.

If you want to get together sometime and talk options/numbers I’m in town and love talking real estate. Hit me up with a PM and we’ll have a burger or something. 

@Michael Cheng

Quick question:

Can you earn your income remotely now or in the future?

I had a friend who did network security (either remotely from home or onsite across the country )earning your ballpark income in the Midwest until I showed him he could buy a house here in Vegas with just the state income tax saved.  

I phrased it as now or in the future (maybe even the new career) as that would be a reason to lock in at least 1 property at today’s rates and prices.

Ps. Florida, Alaska, South Dakota, Wyoming, Texas and Washington state offer that same benefit if you wanted a city that wasn’t Reno or Las Vegas. (Miami, and Seattle city life or anything in Wyoming wide open spaces.)

man, somebody better have biggestpockets.com by now. 

Could we start simple? We have connect and follow. How about block or unfollow? I’ve had too many experiences with “users” that post the same comments to every post, users that only post negative, you can’t do that crud, and add nothing to the experience but rather only take away. 

If I could block 20-30 users posts from showing to me it would greatly enhance my experience. 

Don’t everyone rush to block me now, I was only trying to help. :-)

ps. I didn’t think you could lease out the condo-tell yourself?

The one I looked at, the platinum on Koval (this was 5 years ago when I wanted to rent it out when I wasn’t using it.) doubled the Hoa fees for every week beyond 2 per year that they weren’t allowed to rent it out. And they kept 50% when they did. 

Which obviously means you could rent it out yourself but at the time the Hoa fees were already high, and doubling them and adding cleaning yourself made the 50% charge with cleaning cheaper.)

Like you said. No worries. Just glad you said something instead of steaming to your self about that jerk Bill. ;-)

I’m sorry  but it’s obviously hard to tell emotions on here. Thee was zero anger. It was a legitimate question. I wasn’t questioning you or your motives at all. I just see so many idea on here for the person with little to no money to get started that put all the risk on someone else...

Get it under contract with a bunch of contingencies so you can back out and then shop the deal even if you have zero money. Take over their mortgage subject to and if you can’t pay it you can just walk away, Get a property with seller financing and then sell it to someone else with s bigger downpayment and if they stop paying, walk away. This seems close to the same thing. Got no money? Lease someone else’s property and rent it out. Can’t cover the rent or the laws change, walk away. 

I would guess if 100 people followed this plan, 90 wouldn’t make 1 month’s rent payment after they couldn’t rent it out. Or if somehow the Airbnb newbie overestimated income to underestimated expenses and found they were losing money every month. 

If they outlaw STR the next day or the next month after you start, do you plan to continue to pay the landlord out of your pocket for the remainder of the lease or just stiff them? Vegas hasn't grandfathered any STR properties after they outlawed them in Clark county and changed the rules in Las Vegas.

@Michael Cheng

28-33% Debt to income, 30% is a safe and easy factor to start with as you probably wont be close.

20-25% down payment will be required for non-owner occupied properties.

I would never borrow from my retirement accounts, I was just addressing your concern about having 6 months reserves required to get the investment property mortgages. They will count retirement accounts for that requirement.

The loan discussion involves...

A) Almost anyone will give you 4 loans

B) Almost any mortgage broker can get you loans 5-10 (They will probably cost you an extra 0.25-0.5% interest rate.) (Avoid big banks, try local banks, credit unions, or mortgage brokers.) 

C) So with your income and I assume net worth, you don't want to burn through those borrowing a small (to you) amount of money. Yes you can go to commercial loans after that but they usually reset ever 5-10 years, even if they are amortized over 30 and you want that in this interest rate environment. You want to lock in 30 years.

Let me tell you how easy you have it...

My wife is an RN at a local hospital, she doesn't make $100k/year, much less did we have a spare $100k.  I retired at 40 so I had zero income, nothing.  I acquired 10 loans for a little over $1.6 million with just her income and the rental income as I bought properties (2 -3 per year for 4 years.) 7 were 25% down investment properties 3 were primaries I lived in for a year and then turned in to rentals and repeated. We did this while living off less than your excess income.

Once we maxed out loans (Some married people get 10 each, but then again, I had no income.) AND prices started to skyrocket, we switched to living off her income and sending all the rental income towards paying off the loans. That wont provide maximum returns, but as we pay off one loan ever couple years our cash flow and income from rentals increases greatly. Now we're down to 6 loans (including our primary) and barely a million in debt. (Ps, that still sounds like a lot, 10X her income.) But the rental income is over $10k/month after expenses and that's managed by my PM. So again, I do nothing but "cash checks".

Sorry, Ps. We ended up with 13 properties as I did some cash out refi-s of paid off properties to buy more properties with cash when we found something we couldn't pass up.

PPS. With the right CPA and all the depreciation, almost all that income is Tax deferred. No social security tax, no Federal income tax or state income tax. 

If you're living on 100k less than you make every year most people should be asking you what to do. GOOD JOB. Beyond that... 

Your rental income will count, at least after 1-2 years depending on the mortgage source. Lets assume you're making at least $240k a year if you have a spare $100k after expenses and taxes in California. $20k per month means you have at least $7k per month in mortgage payments covered. 5 mortgages of $110k ($150k minus 25% ($40k) down) would only be $3,000/mo even at 5%. I think your golden, You have a spare $4k/mo plus 70% of the minimum $5k/mo rent is another $3500/mo. You have the same $7k/mo you started with for your home purchase.

Reserves should be a non-issue assuming you have retirement accounts with that kind of income. 6 months reserves is only $20k, a pittance. Start there and buy another house every 3 months. But I would raise your target after the first 5 or you'll use up your ten loans on what you might consider a very small amount. ($1 million give or take.)

You did at least bring an interesting "Problem" to the forums.