All Forum Posts by: Carley M.

You can't participate in the program if you already own property. That said, you can Quit Claim the property to someone else but be prepared to explain the transfer to the bank - such as a sale to obtain funds to purchase another property (for example).

@Natasha Woods - Before I went through NACA, I did the same research. What I found was that people expected the process to be similar to traditional financing - someone processes your paperwork, emails you gentle reminders that you need to turn in that last paystub, and generally keeps everything organized and moving for your file. With NACA, that person is YOU. If you are relying on the NACA staff to do that, you will be frustrated, experience unexplainable delays, and probably have a not-great experience. If you understand that this is a process, that sometimes the loan officers are the hurdles, then you can better manage your expectations and your file. I will tell you that I have had several dealings now with NACA (unfortunately with the same loan officer, so I'm not sure if this is a NACA issue or a staff issue), and I have had the most frustration when the loan officer initially told me no, but I found out later that there WAS a way for that answer to be YES - the loan officer just didn't communicate well. So, if you get a NO answer about something, ask why. Ask what the concerns are that lead to the NO.

For example, I'm separated and my husband owns property. I was told I didn't qualify for the program because my husband owns property and this is a community property state (which NACA feared would mean he could come take my house). The solution was to draw up a legal separation agreement which specifically addressed real estate and where we both agreed to relinquish any claim to the other person's house. Done.

My friend is going through the process and found a 2/2 double to buy. He wanted to add a 3rd bedroom in his unit because he has 3 kids and there's an extra utility room off the kitchen that could be converted. He was told NO. He called me from the meeting and we talked through it.  First, the loan officer was worried about the room being properly insulated and heated. That wasn't an issue because we believe this room USED to be a bedroom before it was converted (during a flip last year) to the utility room. The loan officer still said NO because the house is a 4 bedroom. What he meant was that it was zoned as a 4 bedroom, not a 5 bedroom and we would have to get a zoning permits to change it - which the bank might have issue with or could be difficult to obtain. Fortunately, this house was already zoned still as a 5 bedroom, so we were able to quickly get that answer changed to YES.

Same friend, same bedroom conversion, the loan officer told him that he wouldn't be able to borrow enough money to convert the bedroom because you can only borrow 110% of the appraised value and the first appraisal is "AS IS" value. What the loan officer didn't tell my friend was that because adding another bedroom adds VALUE to the house, a second appraisal can be done (no charge to you) with the contractor's estimate of costs and what will be changed, and the appraisal is done with a "SUBJECT TO" value that will then allow him to borrow 110% of the SUBJECT TO value - more than enough to pay for the room conversion.

NACA also doesn't operate on M-F 9-5 schedule. Several times in my own experience and with my friends' experiences, we have all received Friday evening (after 6pm) emails (from the lender or other departments, not the loan officer) demanding document response within 48 hours - with no access to the loan officer for questions or any indication as to what the consequences are if your response is late or incomplete.

It can be VERY frustrating if you don't keep the prize in sight.  Manage your expectations, keep your files electronically organized, and advocate for yourself. Your loan is only important to YOU.

I agree with @Parrish Weaver. That's how I got my four-plex. NACA is absolutely the way to go. Keep in mind there are hoops to jump through, and you need to keep your documents organized and preferably electronic so you can provide them AGAIN when they ask for something a 3rd time, but the extra little bit of aggravation can easily be mitigated by being organized and it is ABSOLUTELY worth the savings. Closing costs alone for me were almost 40K. I am helping 4 of my friends go through the process now. If you have any questions, I'd be happy to give you my perspective.

Schuster construction did a large job for me and did an excellent job, great customer service. They weren't the lowest bid but I'm glad I hired them.

I bought a 4-unit through NACA. Closed in November. You can finance repairs to the house through your NACA loan too. Best investment ever and it's funding my next property purchase. You have to stay on top of your paperwork. Keep everything electronic and use descriptive email subject lines so you can easily find and resend the paperwork (for the third time). When you do repairs, get a NACA contractor that will fill out all the paperwork for you. Otherwise, you have to play project manager and paper-pusher all during construction too. Good luck to you! It's absolutely worth every hoop I jumped through.

Amber McGill naca allows you to count 75% of the tenants payments toward your affordability - that means that your portion could be $0 (or negative like mine). However, I believe that you should only buy within your own ability to pay. If you have a quad, what could you afford plus the rent of one unit - worse case scenario you won't have more than one/two units empty at the same time if you have 4. For a double, only get what you can afford because you don't want to put yourself in a situation where you NEED a tenant and choose the wrong one because you're desperate. Where I'm at, they converted larger single family homes to multi family. If you have only been looking at single family listings, you won't even see the ones that are multi or listed as apartments. Also check Loopnet or a similar commercial site because sometimes investors put properties there too instead of MLS.

@Amber McGill - if you keep all your documents electronically so you can email them at a moments notice (sometimes several times - always use the Subject line to tell yourself what the attachment is so you can find it easier and resend it!!) and don't have any late payments within the last 12 months, you should be able to move through fairly quickly.  I had a couple unique circumstances that took extra time, but the program works well as long as you stay on top of your file. YOU are the only loan processor and you're the only one who really cares whether or not your file moves from Point A to Point B. Don't be afraid to be an advocate for yourself!

If you have the lifestyle to do so, I would recommend a quad. This is the best financial decision I've ever made. It not only pays for itself but generates true excess income - above maintenance/repairs, above management fees, above water bills and taxes/insurance.  A triple will generally pay for itself but not generate true excess income. A double generally pays the mortgage/taxes/insurance but not repairs, etc.  Of course, the lower the price, the higher the rent, the better your margins in any scenario. I tried to pick one that was realistic and could help me with future retirement/further investements.

@Amber McGill My friend just went through the program and was approved to purchase within 2-3 weeks of his first meeting with the NACA rep.

@Latisha Major I'm a CPA too. Have you considered a multi-family property instead of a single family?

I went through the NACA program and did $38k in rehab. I didn't have enough savings together to go FHA and I didn't see any incentive in giving the bank money that I knew I would need for other repairs/upgrades. NACA has a lot of hoops to jump through, but it's worth it.