All Forum Posts by: Brandon Beaudoin

@Peter Pernal

I'll preface this post with a "Don't do what Ben's recruit" did. Uber high risk especially since he could have been booted anytime during basic/bootcamp (great story though!)

VA has been a phenomenal wealth building tool for my wife and I. I'll lay out just a few of the reasons below (some already mentioned):

1. Low rates

2. Re-usable (it's not a 1 and done thing)

3. 0 down payment

4. Lending cap/max goes away Jan 1, 2020

5. Lenders like that it's back by the government

6. No Private Mortgage Insurance (huge considering you're putting 0 down)

7. A 10% disability rating upon separation will waive an funding fees (that are typically just financed into the loan but at 1.75% of the purchase price, and higher each subsequent time used, it is a great benefit)

Should not be the sole reason to join the military but it is a great benefit.

@Kerry Baird

Thanks, agree. I started to compile a list but once I saw them and their deal I was fixated. It was perfect....except that they wouldn't get an updated appraisal.

Keep in mind with the $63.5k in equity you're only going to be able to tap into 75 to 80% of it because it's a rental.

Another option to consider would be to IRRRL the property since it's a VA loan and shave .5 to .75% off your mortgage. That will increase your cash flow (which already looks pretty good on the surface).

We are going through one now on our primary residence and saving almost $500/mo.

Only 3 requirements are: you lived in the property (ever), it's "seasoned" (210 days since last financed/refinanced) and you shave off at least 0.5%.

@Schuyler Cadwalader

I agree with Amit said. With good/great credit scores you stand to shave off anywhere from 0.5 to 0.75% on a non-conforming conventional (without discount points) on your rate and if you're already committed to owning as a primary residence for 5 years you'll easily recoup the closing costs in a year or 2 tops.

Zillow app has a great refi calculator that shows you monthly cost savings, breakeven points, and amortization schedules so you can play with your numbers in there to help you make sense of it all or compare products.

Based on what you've disclosed already and the historically low rates we're still seeing I'd say it is a great idea to consider refinancing.

We are doing just that on our primary residence with a VA IRRRL and shaving off 1% and almost $500 a month.

Hi BP,

I'm trying to line up a HELOC on our primary residence in SoCal and running into a wall.

We bought in 2018 and end of this month we'll have owned for a year. Since buying we've put a little sweat equity into the place and judging by the neighborhood and recent sales of like models there's been some appreciation, as well.

We reached out to Mission Federal CU and they have some great deals on a primary residence HELOC they offer (2.99% intro for 12 months, as low as 4.75% after that with 10 year draw and 15 year repayment period up to 100% LTV) BUT they have to use the home's purchase price as market value if it's been bought within 2 years. That means we're not getting everything out that we think we can.

We are planning on buying a new place before year's end so we want to capitalize on this opportunity while it's still our primary residence.

Anybody else run into this before and found a way out? Other deals we should consider?

Thanks!

I should add that we are likely turning this into a rental before year's end so waiting 2 years isn't an option and we want to capitalize while it's still our primary residence.

Hi BP,

I'm trying to line up a HELOC on our primary residence in SoCal and running into a wall.

We bought in 2018 and end of this month we'll have owned for a year. Since biying we've put a little sweat equity into the place and judging by the neighborhood and recent sales of like models there's been some appreciation, as well.

We reached out to Mission Federal CU and they have some great deals on a primary residence HELOC they offer (2.99% intro for 12 months, as low as 4.75% after that with 10 year draw and 15 year repayment period up to 100% LTV) BUT they have to use the home's purchase price as market value if it's been bought within 2 years. That means we're not getting everything out that we think we can.

Anybody else run into this before and found a way out? Other deals we should consider?

Thanks!

I should note that I do have a couple properties in mind, one of which I'm working with a lawyer on to craft/legally massage the LOI (and future PSA) and have started discussions with lenders.

Exciting!

Any specific guidance on LOIs?

So instead of going all in on my first commerical MF deal I've acquiesced and made the wiser decision of meeting my wife in the middle. My wife and I have decided to move forward and do a combination of things:

- Take the larger portion of our proceeds and pay off debt. A large chunk of this was for home improvements on our primary residence but also pay off the last of our two vehicles. The one frees up all the equity in our home and combined our monthly cash flow increases ~$1300 a month and has a combined rate of return of ~10%. (Bonus: wife is happy)

- Save off a portion for cap gains and depreciation recap

- Remainder (plus some funds from a HELOC I'm getting) will go towards a smaller cashflowing 8-12 unit property in OH, IL, or possibly MI.

I really want to go all in but I think I'll gain more from this first deal and having my wife onboard yo show her that this can be done.

Thoughts or suggestions?

I downloaded the FHA multifamily (says 5+ units) term sheet a week or so ago and it shows that they have non-recourse loans over for amounts over $750k so is $1m an old limit or that's what they shoot for?