All Forum Posts by: Bobby Njoo

Corey,

Awesome to hear! Congratulations on all the handwork and discipline you did in getting your mind ready and capital ready. Its definitely exciting once you get to the point of declaring you are ready to take some action! Im a local investor, feel free to reach me and let me know if you have any questions. Good luck! 

Hey Cesar,

I am also an investor and active duty member currently in that area. Currently the market is pretty hot here and we did not see a dramatic impact on the housing market during the beginning of the pandemic, so I think it is safe to assume by May of next year, it is still going to be pretty hot. So just a heads up for planning purposes maybe you can take advantage of the winter season (usually known for the "slower" season of real estate) to, maybe if possible, shop around early in advance and hope for less competition. 

Personally, I started with an outdated SFH that I was able to to renovated slowly between underway and deployments and currently living there and renting it out by the room that covers the mortgage. But my partner he started out with the duplex, rented out the other units, and renting out the other room on the unit he is living in now. Both options are great options because you can still house hack either ways but i think the factor of personal preference that you need to consider are the area and share living space.

Small multifamily properties are most likely located in more dense neighborhood that may have narrow streets, no driveways, and busier part of town. But of course that is not always the case. Also, small multifamily listing are not as many as SFH listing so the competition may be a little higher. But the good thing is you can have your own living space if you want by just renting out the other unit.

Since you have more option with SFH, you have more option on the location. But unfortunately, you have to share a living space, which can be challenging if you have a spouse and kids.

In my personal opinion, it does not matter if you decide multi or SFH as long as the numbers work! Take into account if you have to PCS out of the area in the future, is your rent going to cover the mortgage ON TOP of property management fees, regular maintenance, reserves for vacancy and big ticket items that you have to replace over time (capital expenditures). These factors will determine if you made a great investment or not.

I hope this helps and good luck!
  

@Erik Whiting

Hi Erik,

Thanks for the feedback. The 15k is not included the 178k she still owes to the lender. We calculated that if the late payments are caught up (15k), the 178k will go down to around 174-175k and will bring the monthly payment back to 1305. I was thinking what would be the alternate solution for her. She can always sell and take some loss but that's better than foreclosure I guess

Hello BP Family,

I need ideas of how to approach this opportunity. Initially, I see it as a bad deal. However, I started to wonder how I can turn it into a good deal. The seller is my coworker, who has been mismanaging the property and is in distress, and I really want to help her out. She came to me hoping I can help her since she knows I am an REI. I have never done a sub2 deal before but I see this deal as an opportunity that would define me as what an REI should be, which is someone who is a problem solver that provide value and solution to someone in need. Anyways, here is the property's info:

Background:

- SFH 3/2.5 1600 sqft

- Purchased with VA loan in 2016 as a rehabbed property for 186k.

Current condition:

- current mortgage balance 178k

- late payment balance 15k

- original mortgage payment 1305

- current mortgage payment 2345 (new rate to catch up behind payments. Will return to original once late payment is paid)

- currently rented to bad tenants. Lease ends at the end of FEB.

- require 5 to 7k in rehab cost (full paint, partial floor/carpeting, reglaze tubs, patch drywall, and washer and dryer)

Projected condition:

- ARV 215k

- Market rent $1450 to $1575

- possibly offering it as a lease option to help the spread between mortgage and rent.

What I like about the property:

- major components are in good condition. (Roof, windows, doors, HVAC)

- large fenced in backyard

- 2 car driveway in a location where driveway is not common

- Overall, interior is up to date and property is in a good condition and area.

How would one should approach this to make it work for both parties?

Any feedback is much appreciated!

Thank you in advance!

Bobby

@Anthony Pinto

Thanks for the info! Yes one of my lender mentioned a seasoning period of all funds that goes into my account from an account that is not under my name. Definately will send you a DM. Thanks!

@Anthony Wick

I see. Yes i figured that would be the legitimate way of having a property under an llc. For the property that you have under your name, just wondering what do you use for liability protection? Do you think landlord insurance is sufficient or one should get an umbrella insurance as well?

@Ryan Potter

Yes we were planning on drafting up some kind of operating agreement. But there are allot of situation that needs to be covered. Now I understand whysome people prefer passive investor

@Chris Mason

Ah i see. Well i was blind but now i see. Thank you so much Chris. I have to reevaluate my situation definately.

@Chris Mason

You know thats funny because i was just thinking about how to do my taxes in the future (like who will claim what and etc) but i never thought connecting it to the DTI aspect. Thank you so much Chris! I'm not sure if you have used some type of partnership in your deals, but, in your opinion, what would be a good agreement for a partnership?

@Anthony Wick

What is your thought on forming an llc with an attorney vs forming in your own? Also when applying a loan under an llc, would there be a higher interest rate on the loan?