All Forum Posts by: Chris B.

Hi all, need some financing advice. I have 2 single family rental properties. I purchased them w/ a HELOC using my home as collateral. One I purchased under my own name. Now as I am getting more into real estate, I purchased the second one under a S corp account I have from another business that's not doing much. I tried to see if I could get a HELOC on these rental properties and the banks I asked do not do that on investment properties. Am now thinking I want to get 30 yr mortgages on them. Want to be conservative and only take about 40-50 % of the equity out of them.... There's a friend of the family that does mortgages. The questions I have are, should I go through a mortgage broker for this or a bank? If I go to a bank, will I have issues with the one under a Corporation? Do I ask for a commercial loan and try to lump them up? Just trying to get enough cash out to do the next one. Any additional tips or creative ideas from someone who has gone through this would be greatly appreciated.

House 1 :

Purchase price 42000

Rehab cost:   50000

Appraised Value : 145000

Thinking 30 yr mortgage of 60000

House 2:

Purchase price 60000

Rehab cost:  60000

Appraised Value : 177000

Thinking 30 yr mortgage of 80000

Thanks so much,

Chris

thanks Jason

Hi Jason...  Its in Pine Cliff Lake in West Milford NJ about 5 minutes from my house. A nice private lake community.  There are a lot of foreclosures in this town and I think we are nearing the bottom.   Hence the reason I am trying to pick up a few starter homes now.  There are many vacant properties being picked up and renovated in the area.... So am betting on a rebound in the next few years here. I do hope to stay positive/break even with the cash flow during the interim...  There are no guarantees,  and may end up being a mistake.  I probably wouldn't have done it if I posted this before I went under contract.   It is a conservative bet though.  I should be able to rent for 1200 a month as the home rental market is pretty strong here.  I don't see myself losing my shirt investing up here with this strategy.    Definitely not a get rich quick scheme..  Am thinking longer term.. 

Have added.

WOW,  I should have posted this before I locked into a contract.   DEBT pay down will be the priority for these two homes and hopefully appreciation (but I know that's no guarantee)....  I'll consider these as payment for my real estate education as I try to figure out how to make some money with these expensive taxes in New Jersey....

Thanks for all the answers so far...  

Hi all,

Excited... This is my first BP post. :) I am under contract on 2nd BRRRR home. Closing June 16th.

Purchase price 60000

Rehab costs estimate 30000

Taxes 6000 per year

Insurance 600 year

Rent for 1200 a month.

Paying for it with cash with HELOC. Plan to refinance after 6 months.

Did similar with my first investment house. Getting 1000 a month and all in at 80k (taxes $4400).

Am not seeing a lot of money coming back, but am hopeful this will pay off in the long run? Is this a good strategy? Thanks for any positive feedback/ constructive criticism...

Adv"thanks"ance

Chris