All Forum Posts by: Account Closed

must be interest only with 10 year draw 15 year payback.  make sure you are comfortable with the floor and ceiling of the interest rates and run your numbers on both the floor and ceiling. make sure there are absolutely no fees especially for checks, The ATM card, or to transfer money, and the appraisal all free. go to your local credit union if you can currently my local one is offering Prime + 0 so the interest is attatched to prime + any points. 3.99 floor meaning all loans are at the floor currently as prime is at 3.5 and ceiling of 9.  Talk to at least 3 lenders probably 5 or more.  Best of luck

@Mitchell Sullivan @Jayson Damian  Yep it works! You need an interest only loan or it dosn't work. You need to be able to pull money out and put money in at anytime.  Just like a checking.  Here is the book to read outlines how to do it " how to own your home years sooner without making any extra payments" I was on pace to pay off my 30 year note of 240k in 9 years as a Medic, until I realized this is a horrible Idea.  You should never pay off your primary house as you should use it for at least minimal leverage and a nice tax write off. You have no savings as all of your money is tied up in your equity!  Instead I would use it to buy another primary and do it again turning your current home into a rental if it cash flows of course and increasing cash flow and net worth. I personally chose to do both buy multi family and recently was able to talk the wife into moving cash flowing my first home I bought. The book dosn't teach this but that's what I'm trying to achieve increase my cash flow and net worth and hopefully soon I will live mortgage free from rental income. I believe that was your goal mortgage free? Also save 6 months minimum as they can call the note at anytime, and they have before. Best of luck

@Joe Au I can tell you personally that it works. There is a book out there called "how to own your home years sooner without making any extra payments". My HELOC is prime +0 with a floor of 3.99. It worked tremendously and I was on pace to pay off my 240k 30 year mortgage in 9 years not changing anything other than the way I held money. By doing this one time I saved about 25k in interest payments over the course of the loan. If you look at an amortization schedule and run the numbers the interest is acquired daily so you can compound it very fast and the EXTRA PAYMENT is the same as the daily interest you save if not less from the prior amount owed. I saved about 20.00 a month including the payment, and that will increase x2 every time you due the 10k. So that is a squash/ gain unless your HELOC interest rates rise then there is a breaking point. Make sure you do your due diligence. However the larger savings was in the amortization schedule that you knocked off many payments to your schedule. You will need a good bonus points credit card and place everything on that and pay it off every month in full, at the last possible moment to leverage all of your compounding money. It worked fantastic however I realized that this is a horrible idea as you will not have any savings because all of your money is tied up in home equity. If they called the note, your screwed. Also I would loose a huge tax right off and being self employed I need all the write offs. Instead I would recommend using your HELOC to purchase more real estate that cash flows increase your net worth and pay it off even faster and repeating buying more property when you can. I would look at the option of using it to buy another Primary and turning your current one into a rental or buying multi family to cash flow. Make sure that you keep a 6 month savings plan minimum because HELOC's have historically been called in the past causing many foreclosures. best of luck

@Clarence Johnson  Victor hernandez  has been apart of the board of inspectors and has been in business for decades. He is very detailed and customer focused. Must call him with a week notice to get on the schedule

http://www.goldenstatepropertyinspections.com/

@Brendan Curley I can personally tell you that it works.  There is a book out there called " how to own your home years sooner without making extra payments" https://www.amazon.com/How-Your-Home-Years-Sooner/...

I tried it and it worked fantastic, I was on pace to pay off my 30 year note of 240k in 9 years or so without changing anything other than how I held money. It also worked in making me not spend money as I knew every penny was coming from my homes equity. I hit a point that I realized this traditional thinking of paying off your primary note that is probably in the 3's for interest that we may not see again is not a good idea, and you will have no savings with this method as every penny you make is in your homes equity. I am a believer that you should always have a note on your primary residence especially if you are self employed for the taxes. Rather I used the same method to accelerate my mortgage to purchase multi family real estate increase cash flow and accelerate my net worth. Yes my 1 purchase has now turned into 3 with the help of a HELOC I will soon be able to have real estate pay for my primary mortgage which I believe was your goal of not paying the mortgage. But also dramatically will increase my net worth also. I would recommend to not pay off your primary house and using the equity to buy cash flowing real estate or another primary to cash flow your current primary as a rental. If and when you do want to pay off a house pay off the rentals. Also make sure you are keeping a savings account of 6 months or more as the book does not suggest that and what if they call the HELOC like they did in 08. best of luck

@Aaron Mazzrillo@Matthew Cain I think some may argue the cash flow, but you are absolutely right and I wished I moved out of my home 2 years ago and rented it sooner. My wife was settled, took her a while but she agreed to move. Plus I rented for 2 years before that.  Everyone needs a place to live and it makes more since to own if you can make the payments work. Buy for cash flow at a later time and get into a place to live in SD!

I'd say almost impossible, 2022 may be the next 2011 depending on how bad the next one is but I have a feeling this will be a normal correction as affordability is becoming an issue for many. It is True that my generation of millennials  interest in home ownership is lower than baby boomers and a lot of us need to grow up, settle down, and even move out of moms.   I do have folks wanting to buy but burdened heavily by 50k or more 1 was 150k in student/credit debt and with as large as 20% interest rates. Baby boomers were statistically a younger age to settle down and could more easily afford it. Could you imagine the next elected president bankrupting the country and all the banks calling all notes! Might be what the country needs is a bankruptcy to fix this debt , currently we are headed that way with this increased spending. Hopefully they don't call the notes because harry dent would be right and anyone's strategy on BP to use no leverage with real estate would be fine. Better save some of your cash flow!

have an attorney review your contract! You should have an inspection contingency period to make sure you are comfortable with the property. that is your time to do your do diligence and get the property inspections. 30 days for a commercial deal will be incredably hard to close on time if you are getting a loan. Make sure you get the trailing 12 and confirm their NOI. Try for 2 years. Get the leases currently in place. Confirm the deposits transfer to you and how much. Talk to the property managers/ tenants if youd like to find out every in and out about this property and how much money is needed for repairs.Sounds like a big real estate deal. Congrats. Best of luck...

@Justin Harrod That is awesome that you got a cash flowing property in SD as that is really hard to find in this market.  I have recently also changed my mindset from selling real estate to buying it for myself.  I do have out of state properties but would prefer to find something here in SD as I can move every 6-12 months.  It's finding a house that makes sense that is hard to find in the rising SD market.  If you ever want to bounce ideas off each other feel free to message me

@Shannon K. My HELOC has been great to acquire property. The qualifications will very lender to lender. Depending on your Loan to Value ratios is a large part of what the rates and terms will be. Usually on HELOC's for the most favorable terms you willl not want to go over 75% L/V some institutions lend up to 100%... I would call your local credit union as they are usually the best out there. Make sure you talk to at least 3 lenders 5 or more preferred. My HELOC was set up at 45% DTI ratio. One thing if you tell them when applying / inquiring is that you plan to purchase a home with the HELOC. They do not want to hear this and see it as a high risk and a business loan in which they will want less favorable rates for you and want to set you up on a business loan.. Make sure that you check the box the money is for repairs as this is the primary use for the HELOC