All Forum Posts by: Bryce Brown

Hello,

I am looking for advice on structuring a purchase from family. My grandfather recently passed away and my parents have had his house in their name for many years. I have always expressed interest in purchasing the home once it made sense, and to turn into a rental.

My parents are onboard with me purchasing the home from them instead of going to the market. I plan to pay market value, but they’ve expressed possibly giving me a slight discount of maybe $10k less than market value.

The house is in good condition overall, but will need cosmetic upgrades mainly to the bathroom, and kitchen. I was planning on using the BRRR method for this, but then a new idea came to mind.

Since nothing is owed on the house, my parents would be fine letting me update the house to use my available cash before getting a loan.

Using easy numbers, let's say my parents agree to sell me the house for $100k. If I put about $15k into the house and the ARV is then let's say $170k. Could I then get a loan for the property and request $40k back at closing? Would that be taxed since technically my parents would be writing a check at closing back to me?

Is there any other creative ways to do this deal with it being with family? I’ve considered a land contract, but I feel as my parents would like to receive a lump sum from the property vs. me making monthly payments to them.

Hello,

I am 24 years old and new to real estate investing, and I picked up my first duplex in December of 2019. I have been house hacking and living in the upstairs while renting out the lower unit. I recently was approached by someone interested in renting out the unit I am currently in. I was going to rent out both units and the property should cashflow roughly $400/month. 

I got a Homeplus loan on my duplex and put 5% down. I was looking at picking up another duplex or single family since I would have long term tenants in the duplex. I contacted my lender and he advised I am only allowed PMI on one house. I either need to reach 20% equity in my current duplex or I need to put 20% down on the next property I buy. I currently only have about $10k to put towards another property.

In addition, my lender advised with my loan there is an expectation I live at the property for at least 1 year. I don't want to jump the gun on purchasing my second property if financially it doesn't make sense, but I also don't want to pass up the opportunity of having two good long term tenants in my duplex.

Are there any other strategies or ways for me to get another property without having PMI? I could take the money I have and put it towards my mortgage and that would put me at about 20% equity in the duplex, but then I wouldn't have much cash leftover for another property. Would it be best for me to rent out both units and crash at my parents house for a few months to save up even more money?

Any advise is appreciated.