All Forum Posts by: Kirill Chervets

I would not wait, I am still buying on 30 year fixed mortgages and make sure it cash flows from day 1. 

Hey BP!

I need help!

I have a 1960’s side by side duplex in Everett Wa. Great location off the freeway and between schools. The lot is zone for 4 units and I’d like to tear down the existing duplex and put in (4) 800-900sq 2/1 units.

I have gone to the planning office and had a feasibility report done and everything so far lines up.

Here’s where I need help, I don’t know what I don’t know. I am in a good equity position as the existing duplex sits now and have some cash to take a non owner occupied construction loan (I have 6-7% secured otherwise)

From initial numbers I’m looking at 800-900 to build and after construction value of 1.3-1.4 with about $96,000 gross rents.

I am seeking feedback, constructive criticism, and contacts who have experience in something like this.

Thank you!

I have not checked with BECU. I never have had great customer service from them so have avoided them for quite awhile. Maybe I should go check them out again. They have that main branch in Everett. 

Hey BP,

I have a duplex in Everett that I would like to cash out refinance on. It is currently leveraged roughly 45%, I am looking to pull cash out and leave it 75% leveraged. It has been rented for several years and is non owner occupied. Anyone have recommendations on someone local to start building a relationship with? Thank you!

Hi @Account Closed

I was sort of in the same position as you at 22 (I am now 30)

1. I highly suggest finding the highest paying ethical job you can and work as much as you can. 

2. Save every penny you can for 1 year.

3. Find a duplex on the MLS that is a cosmetic fixer or fairly turn key.

4. FHA financing

5. Move in to one side and perhaps even get a roommate 

6. Rent out the other side (Make sure to screen carefully and do your due diligence 

7. Even if you over paid for the duplex you are 22 years old and will be living for free or nearly for free.

8. Enjoy life while living in the duplex and saving money

9. Save enough for another purchase and move out of the duplex while renting both sides.

10. By that time life will have changed and you may be looking at SFH or even get back into another duplex and rinse and repeat.

11. I know this is possible because I did it in the Pacific Northwest King county/Snohomish county where prices are not cheap. 

Let me know if you have any questions. It is a slower game but is fairly safe and provides you a place to live, build equity and learn to be a landlord since the tenant is next door.

NOTE: You can refinance the duplex and get out of FHA financing later

In my opinion house hacking is one of the best and safest way to get into real estate investing. 

Buy a 2-4 unit 

Owner Occupied mortgage (one that you could afford even at 0-50% occupancy)

Try to make it so you live for free by renting the other units. 

Save the $ you would spend on housing for future down payment.

Rinse and repeat until you have as many units as you want and you can buy a SFH for yourself.

@Brian Richmon take the survey... you might like where the site is heading. 

Great topic and question; I have purchased both a townhouse (that has tripled in value) and a duplex as well! Both are cash cows and the returns are awesome. I think if you were to purchase a duplex, live in one side for free and stack cash for another down payment you will not regret it. 

Are you ok with a 3% return on your equity  ($7200 a year)?

Perhaps its called "infinite return" ?

You have made back all your cash invested and are now getting an infinite return.