All Forum Posts by: Cory LaChance

Do you have the elevation certificate of the house? Raising a house is a very expensive project - around $100k for some of the houses in the area. If the house is truly a gut remodel, Brazoria County may not even issue a building permit to remodel it. They require a permit if the renovation costs are greater than 50% of the value of the property, then the property has to be at least 2 ft above the BFE. You might be able to receive a variance on the 2ft above BFE, though the flood insurance will be expensive for the end buyer. 

As far as GC's go... All the good ones are busy and very few are taking on new projects. I've got 2 remodels and a new construction going on right now, and my guys' phone is always ringing with opportunities for work. It's crazy.

This house doesn't have "Trail" in the street name, does it?

I live in Lake Jackson and own some rental property here too. What insight are you looking for? Just to give you a feel for the current market. The rental market took a major hit earlier this year when a couple major construction projects finished up, then the virus hit. I currently have 2 vacant houses and landlords in the area are lowering rent every week. 2 of my tenants will have trouble paying rent next month. The majority of the rentals are chemical plant employees and most construction has been delayed. And not much on the books for future work either... at least for the next 4 months or so. 
Feel free to message me if you have any specific questions. 

I use Allstate for 4 of my properties that are owned personally. My premiums average around 1/3% of the policy limits. They offer a pretty decent Landlord policy with $1,000 deductibles with $500k liability.

I have a couple questions-

1) Do the properties associated with the LOC have a mortgage or are they free and clear?

2) Are these LOC's attached to a single property, or can they be tied to the equity of multiple properties?

I am tossing the idea of getting an HELOC for quick/easy access to cash, but I don't feel I have enough equity in any one single property to justify the cost/benefit. I own 6 houses and collectively, there's enough equity to put some real work in. All the properties have mortgages and across my entire portfolio, I'm only leveraged about 50%.

2 were listed on the MLS and 1 was a friend of a friend whose grandmother had passed away. 1 other that I bought conventionally - 25% down and funded the remodel with my own cash. I have 5 properties total now. My goal is to do at least 4 a year for 5 more years and go full time.

Thanks, @Luis Regla! I still have that property. I have since put a new roof and an AC unit. If I had to do it again I would have replaced those items during the rehab. Lesson learned... 

I have used the BRRRR strategy on 3 other deals and have since opened a line of credit with a local bank am working to acquire higher end properties. This past year has been very exciting!

I own 2 properties in AE in Freeport, TX. Both premiums are around 1% of the appraised value of the property. The cost is highly dependent on the elevation of the property and unless you have an elevation certificate (Around $450), you won't get an accurate quote. I have only owned these for 2 years and the premiums have increased by about $50 over the 2 years. 

I can't comment on the speculation of premium increases, though. But I would certainly not shy away from purchasing a flood zone property. Both deals I made had the price included in the analysis of the purchase. 

It's expensive to own property in my area. You must insure through Texas Windstorm (for Windstorm) & FEMA for flood (if you're in a flood zone). My insurance costs account for 10% of my income in my flood zone properties. I have mortgages on everything. I'll cancel Windstorm once they're paid off.

Was told a similar thing by another broker... Anyone have a mortgage contact in the Houston area who knows what they're doing?? 

@Brian Pleshek - Thanks for the link. I had never thought of the law preventing the due on sale clause. It was explained to me that the bank could freeze the account (whatever that means) if they found out she passed away. We have been paying the mortgage for the past 3 months as if nothing has happened. We have access to her online account and keep her checking account where she paid active (My wife was on the account before my MIL passed). The goal I am working toward is the cash out refinance and knowing that the bank can't call the loan due gives me some peace of mind knowing I can shop around and not rush the refi.

@Thomas S. - I could certainly pull up to the 75% LTV limited by the cash out refinance rules. I don't feel comfortable leveraging my assets to the max as my total portfolio is around 50% LTV. This property will rent for $1,700 a month and is fully remodeled. My wife and I went back and forth as to how much to borrow against it and I'm a conservative kind of guy and we settled on the $60K ($100K total mortgage). I already have a $100k LOC open that I have been using for purchases and having the extra $60k cash will give me some flexibility.

I fully understand that I am now responsible for the $100k. This will be our 6th rental property and they all have mortgages. I am afraid of BOFA calling the existing note due with the transfer of ownership on the property before I can get the property refinanced. Surely I am not the only person who has kept an inherited house and turned it into a rental property and refinanced it...