All Forum Posts by: Brett Riemensnider

Hey everyone, I am looking to purchase my first investment property in 2024. Thinking a duplex makes the most sense for my investment strategy but am wondering what my options are for financing. 

I own a home where my fiancée and 4 year old live. We are not interested in a FHA loan because legally I would have to live in one of the units for a year (away from my family; unless there's a way around that that I'm unaware of).

Are there any other strategies for low money down purchases in investment properties? I’ve heard of seller financing but don’t know how I would approach that and that is the only other thing I can think of besides coughing up 20-25% down which would completely wipe out the bank account. Any advice or guidance is greatly appreciated! Thanks! 

Quote from @Jaron Walling:

"My interest rate is at 2.62%" - Do not loose that rate unless you sell. Pull a HELOC if you need for the next property.

Yes I definitely don’t want to change that interest rate. HELOC’s are different than refinancing correct? I would be able to keep my same interest rate on the home, but is there a new interest rate that goes into doing a HELOC? I don’t know enough about them, but business common sense would tell me that the bank would need something in return like a higher interest rate to make that worth their time. 

Quote from @Danny Randazzo:

@Brett Riemensnider have you consider bringing on an investor or partner to help? A lot of times investors can get further faster by partnering versus trying to do everything on their own.

 Yes I have thought of that. However I’m unsure of how to get into a partnership with someone with experience while having none myself. Have a lot of drive but lacking full knowledge and experience. 

Quote from @Jaron Walling:

@Brett Riemensnider You're asking the right questions. Your lender will require an appraisal to determine EXACTLY how much you can cash-out. Unless that was completed the $80k was just an estimate. I don't know any lenders that will let you pull >80% LTV at this time. You'll mostly likely fall in the 70-75% max LTV.

Your payment will go up but like you said the positive cash-flow from the multi-family should cover it. I wouldn't leverage your primary to loose hundreds of dollars each month. But if you're leveraging and reaping the rewards and this theoretically property only costs you $50 per month it would be 100% worth the investment. Especially if the location and property condition is good. You're spreading equity into more properties, paying no taxes on rental income, and seeing the benefits of REI. It's like step 5/50 because you're already a home owner and been through the closing process.

It's on you to decide how much you want leverage, how much skin you have in the properties (probably a minimum 20%), and what level of PM you can or want to handle. 

 Thanks Jaron, I appreciate the response. Yes this was simply a ballpark of what I could more than likely pull from it. My interest rate is at 2.62%. Haven’t got to running the numbers on properties yet either, that $200 pure cash flow per unit was just for the example. 

I’ve just been reading a lot of books so far and narrowing down what I am looking for. I don’t know what the numbers are currently looking like or what is realistic for what I what/what I can afford.

Hi everyone. I am looking to buy my first rental property and so far have narrowed it down to a small Multifamily. Unfortunately I only have about $25k as a down payment which isn’t much to put down on a Multifamily. 

I currently own a single family home which I live in and talked to my lender about pulling equity out to help out with my down payment. I was told I could probably pull around $80k out. 

Two questions. 

1. If I pull that $80k out, my monthly mortgage payments will go up around $450 per month. Would it be ideal then to find a Multifamily property that will cash flow OVER $450? Or would that be viewed completely separately? For example, let’s say I find a duplex and after all expenses I’m left with $200 pure cash flow per unit. In my head, that would be a negative cash flow of $50. Is this the right way to think or am I over analyzing? 

2. When I bought the house, I put exactly 20% down to avoid paying mortgage insurance. If I take the 80k out, does that mean I start paying mortgage insurance? Or is 20% only needed for the initial purchase of the property? If so, is that worth it if I’m using the money to invest? 

Thank you. 

Hi @James Hamling, thank you for taking the time to answer my question. 

You’re right, I was probably being a bit optimistic by thinking we could get into a multi family with $40k down. I hear all about multi family and how great it is for investing, but unfortunately my hustle and determination doesn’t put a larger down payment down. 

I am definitely thinking Minneapolis suburbs more than likely. I have lived in Minneapolis and surrounding cities all my life as well as my friend. Maybe getting a place with him isn’t the right call. In my head I was thinking this would be great because one; I have more of a down payment for a property, and two; I have a guaranteed renter right away. Maybe that’s not enough for a partnership with someone who doesn’t think the same way I do.

My goal is to be financially free so I can spend more time with my family. I feel extremely “late to the party” and just want to start making the moves instead of making excuses of why it’s risky or why it can’t happen. 

Sorry for the rant, I appreciate the thorough response to the question. Gives me a lot [more] to think about.

Oops. Feel like an airhead for making that mistake. Thank you for the insight everyone. I am extremely eager to get into the REI game, I just still feel that no matter how much I read, I still am not fully grasping it. I appreciate your time.

Hi everyone,

I’m looking to buy my first investment property. At the same time, a very close friend of mine wants to buy his first home. My goal is to present him with a 50/50 partnership on a single family or up to possibly a triplex in which he would be one of the occupants.

Would we be able to use an FHA loan to get locked in at a 3.5% interest rate? My current mortgage is not FHA.

Who are the right people in the real estate business that I should be reaching out to for more information before I present my idea to my friend?

Thanks.

Hi my name is Brett. I currently own a home that I live in with my family of 3, we have about $80k in equity and our mortgage rate is fixed at 2.62%. I have about $20k I could put into a deal myself of my own money. With only $20k down that doesn’t seem like a large enough amount to go into a deal expecting to cash flow in this market. So my idea was to find a partner to avoid taking out equity.

I have a friend who has been looking to purchase a home but he has been getting cold feet. My goal is to present him with a 50/50 partnership on a small multi family or single family home that he himself will be living in. My benefits being that I have someone occupying one of the units before we even find a deal and we both benefit by adding twice as much money to a down payment on a property.

Now here’s what I’m struggling with. If we were to do that, how would you recommend handling his unit’s payment? On top of that, what does it look like with everything outside of “rent”? Utilities? Parking? Snow removal/lawn care if we went small multi family? Since we are partners and he owns half, would his unit still be expected to pay market rate rent? What would be the best way to go about properly dividing our finances to have a true 50/50 partnership? I want to approach him with a sound business plan that makes sense before we start looking at properties together. Thanks for taking my question.