All Forum Posts by: Brittany Minocchi

Will you still have money in the bank after the transaction? If you'll cash flow $400-$500, that's great! I'm assuming you aren't planning to live in one of the units and are doing a 25% down conventional loan? 

Louisville is a nice area! I'm about 25-30 mins away in Massillon. My husband and I bought our first house at 22 and we still say that was one of the best financial moves we've ever made, and it set us up for success. That being said - yes, I would advise someone to make the same move you're making if they were financially ready and willing to take on the responsibility. There are 25 year olds that are in a far better position to start investing than some 50 year olds. We also prefer duplexes over single-family investment properties. 

Without knowing all of the details, I'd say cashing out and paying off your HELOC since it's a safer bet - your personal home isn't on the line. But, it would also depend on the mortgage payment and rents.

I'd love to talk about the lending side of things! I'm also in OH. You mentioned moving here soon...are you planning to house hack or rent out both units?

I would start by speaking with a mortgage broker - they can take your application, gather all the docs needed and see which programs you're a candidate for. In addition to everything others mentioned above, HomePossible has income limits, so it may not be an option depending on where you live. In a multiple offer situation, conventional options typically have a "leg up" over FHA offers. FHA tends to be a better options for those who have lower credit scores and/or a higher DTI.

Hey Dylan!

I'll just be straight with you - you'll want to build your credit up a bit (aim for at least 660, but the higher, the better!) and save up more money. For a property that needs rehab, you'll start with a hard money (bridge or fix & flip) loan. That loan will cover a portion of the purchase price as well as 100% of the rehab. On a $500k purchase price, expect to need 20%+ down as a new investor. Not only are you a new investor, you're new with rehabbing properties - two things that will work against you. You'll also likely need to show reserves, covering x number of month's worth of interest payments (depends on the lender's requirements). Once the property is rehabbed and you have a tenant placed (assuming the property won't be flipped), you'd refinance out of the hard money and into a DSCR loan if you anticipate issues with your income, employment history and/or DTI. Hard money is typically a 6-12 month term, DSCR will be your 30-year product. Ideally, you'll want to have enough equity at that point to pay off your hard money loan and cover your closing costs, walking away with cash after closing (or at the very least, breaking even). I would definitely try starting at a lower price point, $500k is a biiiiig undertaking for a first-time rehabber. Best of luck!

I'm in Ohio and can help in Cleveland, but that low of a loan amount is TOUGH and won't be cheap. You'd have at least $5-$6k+ in lender fees before title fees, escrows and prepaids are accounted for. 

I have one lender that will go that low, but keep in mind many of the fees for these loans are a flat amount and not % based (so you'll have a decent amount wrapped up in costs relative to the loan amount). Rate will also be higher. Feel free to reach out. 

Hey Danny!

Feel free to reach out, happy to discuss. 

Depends on your risk tolerance. Is the HELOC on your primary home? If so, you're putting that on the line to fund your flip. Lots of people go that route, but there's probably an equal number that wouldn't risk their home and prefer to use other people's money.

Are you staying in that area after graduation? If so, I'd also suggest house hacking a duplex. Live in one unit for at least a year and rent out the other. This will be the lowest cost of entry with a 3.5% down payment. If that's not an option, you're looking at a minimum of 15% down for a single family investment property.

If you haven't been working, you'll want to wait until you have a 2-year employment history UNLESS the job you have after college ties into what you're going to college for.