All Forum Posts by: Chris Kay

Hello, I want to move forward in forming my first BRRRR team here in the Upper Peninsula of Michigan but I'm not quite sure where to start.

I've seen a few foreclosed properties around my area for less than $50k in neighborhoods where it would appear that if these homes were really fixed up they could ARV for $120k (or more). So from my newbie perspective a 75% all in of ARV appears realistic but I need to get some experts on my team to run the numbers and get things moving.

For capital I could use 90-100k of my own cash, so who should I contact first to begin building this whole BRRRR team? I mean in general what sort of expert should I try finding first, but if someone has specific people in mind who deal with the UP that works for me too. I'm looking in Marquette County.

Thanks! 

@Drew Sygit Cool thanks I'll look into DSR loans! 

I do have my VA disability as my "job" income and I hear that lenders will count that at 1.25% for calculating DTI since it's tax free. I never had that come into effect on my single family home purchases since I never wanted to personally be on the hook for such a high mortgage, but I think it might come into play for an MFH.

Thanks for all the advice, I'll definitely have to research more as I go about how to build out my portfolio and whether I want to pay down the existing loans or buy more. I don't think I need to have that exactly figured out on day 1 of my first rental purchase, I need to get into the game. 

One other question if you or someone else knows the answer. When lenders calculate your DTI and your owned properties are breaking around even or a little cash positive from rents, do they basically look at those as no debt or even positive income to keep giving you more loans? That's what my assumption is for getting the additional loans. I don't want to be surprised though as I go to buy additional properties just to have them say that I'm taking on too much debt even though my income can support it so long as I continue taking in rental income.

@Drew Sygit thank you very much for the reply! 

Yeah so it's okay with me to not cash flow a ton in the first few years because I already was able to quit my job 2 years ago and live frugally here in the UP. So now I'm in a position where I can approach investing/landlording as a full time job if I want and try managing my properties myself, which is something I'd like to learn.

Yes they all will be close enough together where in theory I should be able to do a lot of this personally even when I move out of one into the next. And yeah Marquette, MI is an appreciating market and a college town where everyone complains about increasing rents (and their bad landlords).

Hopefully I can still find a few properties that can cash flow anything, no matter how small, with zero down but I'll have to see if they'll pass VA inspection too. Like I said, the calculator is telling me it's possible on some that I see on market now but I'll have to see if that is true in reality when I run the numbers with a lender.

Okay so I think you're helping me to see this plan better. Buy 2-3 multifams with the VA loan and rent them for as much as I can. I had thought about just doing LTR but maybe yeah I want to be more active in managing them myself, taking more risk, and go for the STR/MTR.

It scares me thinking about trying the Airbnb route but this area has two distinct tourist seasons in the summer and winter so it might be worth it for at least some of the units. Otherwise maybe shoot for month to month or align rents with the college semesters, I dunno. 

I guess what I'm still not clear on is then say I get 3 MFHs on VA loans. Will it be worth trying to pay those down quicker over the next several years or use savings to try to acquire more properties via other loans?

I could see really getting into this and wanting to keep growing the number of properties I own so long as I can keep qualifying for loans, so I need to understand how to transition away from the VA loans once I'm maxed entitlement and keep growing my portfolio.

So it's build up equity then huh, and refinance out of the VA loan or cashout to buy on another loan type? Maybe I can qualify for a traditional loan on another property in the mean time before I have enough equity in the VA homes.

Hello, I'm looking to start investing in rental properties in the Upper Peninsula of Michigan in Marquette County beginning with house hacking multifamily homes using the VA loan. I've used the rental calculator enough now where I think I can find a few 2-4 unit properties that can cash flow at least $100 a unit even with zero down, though the pickings be slim at any given time. I have VA disability to waive the funding fee and don't pay property taxes for the property I'm residing in.

I've used the VA loan 3 times before so I'm pretty comfortable with it, but only for single family homes. I'm currently using about $120k of the $805k entitlement for 2025, so my plan is to purchase an MFH soon and move into one of the units while my parents become the tenants to my current home. I then plan to do this again or maybe 2 more times depending on the ability to stay under the VA entitlement cap.

But that's all I'm currently smart enough to plan. Obviously it's a start but I don't think I can cash flow more than a few hundred dollars per property with zero down so what do I do next to keep growing my portfolio? I should mention my dad is a disabled vet as well and is maybe interested in growing a portfolio too so we could team up. I don't personally have tens of thousands in cash on hand for larger down payments (I do though in my TSP/401k), but my dad will have maybe a couple hundred thousand after the sale of his house soon. I'm not sure his willingness to part with that cash though unless I can make a convincing argument to invest.

Any help would greatly be appreciated in seeing the bigger picture roadmap here for how to turn this small MFH house hacking into something far greater. Thanks!   

@Drew Sygit Yeah I am seeing that in my calculations, thanks for all the advice! There's literally only the one property in my market currently where I see a decent cash flow so I think I need to consider buying it sooner than later. The cool part about house hacking it too at 100% VA disability is I won't be paying the taxes on it while living there so that offsets the monthly cost a bit until I get something else to rent it out fully. If I can find something like this that appears doable even with 0% down then I have to imagine other stuff will come up too so I think this can still be done, just have to get stuff at the right price.

I'm trying to do this now too in Michigan with a 2-4, whatever makes sense. I've been running a lot of numbers for properties in my area and what Jonathan Greene said about uneven MF houses is making mathematical sense to me. The highest cash flowing place I found so far is a duplex that's a 3/1 and a 2/1, and there's an additional standalone home on the property that's a 3/1. So even with me living in the 2/1 it cash flows just barely (at least on paper) but it looks pretty good once I would move out. This would be VA loan with 0% down so I might try to pull the trigger here on it soon. I'm just not quite ready to buy so hoping it lasts.

Hi everyone, new to investing here but I've used the VA loan 3 times now and have had 2 at once so I have a good understanding of how it works. My dad and I (both with access to VA loans) are about to get into the multifam game and how we proceed is really going to depend on the true occupancy rules for the VA and our lender. So, this whole "you must live in the property for 1 year" claim that we see online seems to be completely baseless. Just read under Occupancy: https://www.benefits.va.gov/WARMS/docs/admin26/handbook/Chap...

All the VA says is that you must intend to occupy the property within 60 days, and there are even exceptions to that. There is nothing about how long you need to occupy the property for.

So unless our lender puts a demand on us I see no problems legally in occupying each property for any amount of time to fulfill the requirement, then rinse and repeating this process up to our full entitlements, so long as the lender is willing to keep giving us loans. Between my dad and I that is $1.6 mil in entitlement (minus my current house) for 2025.

Has anyone gotten more than 1 VA loan in the same year or come up against problems with this strategy? My realtor is reaching out to local lenders now to ask questions so I'll see what they tell me directly but I'd rather buy more sooner than later if we can.