All Forum Posts by: Chris Lopez

@John Warren My apologies for not being specific about the location. I'm currently looking at a rehab SFH in Alabama. However, if the deal falls through I'll certainly keep your broker in mind for MFH in illinos, thanks!

@Ryan O'Mara Great advice, I'll be sure to pull my credit report for lender inquiries. I noticed your company limits loan services in CA by referral only. Is that true even if the property is not in CA? If it's not true and Rehabs are something you do for first time rehabbers I'd love to chat! 

@Harjeet Bhatti Thank you for the advice, Harjeet. I also feel it worth noting the other good advice you DM'ed me which was double checking whether current expenses I have could count as a line of credit in my credit history which I now realize my rent history can count as such, but I will need to contact my landlord/the property management company in order to get those sent to credit bureau.

@Ali Boone I was unaware lending could be funneled and narrowed down a lot more. Since I do have a property and state in mind I'll be sure to start digging up lenders accredited in the area. In regards to your article (great read by the way! I can't believe I didn't find this earlier), how do you validate lenders who are small and new. I've seen some that on the surface (their website) seem very lender friendly with even recommendations regarding certain loan types for strategies yet are non-existent in the BBB, NMLS, or sometimes don't even have recommendations/reviews on any platform I can find. Giving sensitive information needed for the loan process to someone with an LLC (which isn't difficult to make) that I can't validate seems rather risky, thoughts?

Hey BP! I could use your advice! Just recently got a steady W2 job, good credit score in the 750+ range, a decent amount saved for a down payment and am currently living in the Bay Area (where the debt necessary to purchase a home is outside my comfort zone/doesn’t seem like a good choice at the moment). So, currently I’m evaluating my options for financing out-of-state investment properties. However, initial calls resulted in my credit being pulled only to be disappointed by the fact I didn’t meet certain criteria (3 lines of credit history for 1-year each, etc.). Yet I didn’t see this criteria when researching about the loans in question initially (most quotes/sites tend to avoid the discouraging stuff off the bat) and despite asking to be told some of the common criteria they look for their answers were along the lines of “we could talk all day about that or I can just check for you”. My question is: How can I avoid much of this back and forth (and credit pulls) in situations where I so obviously wouldn’t have qualified had they simply been more transparent, and/or do you have any loan/lender recommendations? I’ve read about portfolio loans, and small credit unions but I’m not too solid in my understanding of why their criteria tends to be more lenient than conventional investment home loans. Thanks in advance!

Not sure if this is the right forum to get insight on my strategy, but any advice or personal experience would be appreciated!

I want to start my real estate investing journey, but since I'm moving to California to work the only living situation that makes sense for house hacking (since I'm a new grad and don't see myself outright buying a 500K+ condo or 650K+ house in San Jose comfortably) seems to be a mobile home. I understand that the money is in the land for MHs, but I think simply renting a lot and buying a 3/2 or 3/3 mobile home (resulting in around 3K/month cost on the higher end of homes) then renting 2 of the 3 rooms out for around 1k a month would result in a little over 1K expenses (which beats the 2K+ apartment rent in the area while building up MH equity that can be leveraged later). 

I have two main questions:

1) How have some of you leveraged MH equity in your own investment strategies?

2) Is there something I'm missing? (I get the MH will depreciate, but the way I see it 50% of something is better than the 100% of nothing I'll get from renting an apartment or other place.) 

That makes sense. I’m certainly not buying a manufactured home for the appreciation. My main goal is reducing living costs (ideally completely), my secondary goal is to leverage my buying decision to help me start buying actual real estate as soon as possible. Not being able to 1031 exchange mobile homes makes sense now J. Martin so thank you for that explanation. I’ve heard of others using their mobile home equity/using it as collateral to secure better loan deals in another property which still seems like a beneficial route for future deals. I’m just not entirely certain if I’m calculating a mobile home deal correctly since I’m treating it like a SFH.

@J. Martin,

Thanks for the warm welcome! 

You brought up some good points I didn't consider like the threat of rising lot prices, would you say that rent in the area tends to grow with lot prices? I would view it as a good deal as long as I'm alleviating myself of the cost of living in the area. Although, some cash flow is always nice. I plan to contact the listing agent to determine if the property value includes land and if not to determine how much rent prices would be for a new lot tenant. 

If the numbers work and the rental rules aren't that strict the plan would be to sell the property down the line once I have some decent equity built up, and likely 1031 exchange the depreciated value of the manufactured home into a down payment for more expensive property in California. I'm hoping the equity value, combined with money saved from not paying for living, plus any possible cash flow would be enough to let me invest in actual land/property in the area.

Do you have any recommendations in terms of resources for reading up on landlord/tenant laws in the area?

Hey BP!

I decided that graduating college and moving to a new state would be a great time to start my real estate investing journey! I have no college debt and quite a bit of savings for a decent down payment. Unfortunately, my job is in the San Jose, California area so the only thing I think I could reasonably afford to buy and house-hack is a manufactured home. I would love input on my plan seeing as I'm not too familiar with the specifics with manufactured homes or the Bay Area real estate market.

Plan: Buy a manufactured home with an FHA loan, 3.5% down payment and rent out the extra rooms.

Current Financial position: No debt, credit history is in good standing (700+ credit score), enough savings for down payment of manufactured home in question, good W2 job waiting for me, previous W2 income is 1 year worth of unsteady (more than one company/not-continuous) internship income.

Questions: 

1. What are the main differences between manufactured homes and SFH. I've done some initial research and couldn't find much more other than the cheaper construction materials means likely more maintenance (however building standards have improved significantly over the years), land may not necessarily come with the property, and insurance tends to be higher proportionally.
2. I believe the conventional loan route is out of the question since I don't have steady W2 income for the past 2 years (only a year worth of internship income, and wasn't at the same company), but I have heard having been a student as well as leveraging the income you plan to make in your new job is enough to get an FHA, is this true?
3. If you have any good contacts or resources for learning up on the area's market and/or about manufactured home investing/house hacking I would greatly appreciate it! 

Thanks for reading!

I think only you can truly answer your own question. You should consider your goals both personally and in REI. If you want to go straight into renting your property you can, the experience can be invaluable. If you don't like the returns your current property would get then maybe consider selling the property for the profit you have estimated and reinvest that money in a multi-family you can house hack. Or if you would rather not get into land lording yet you can simply sell the property and give wholesaling a try but then there's the question of where you'll be living. Newbies tend to get into wholesaling in the beginning in order to generate enough money to get into buy and hold. However, most money made in REI is made during the initial deal. This is why your situation is tricky because you're working with a deal you made prior to getting into REI it seems. There's a lot of ways you can approach this, but keep in mind just cause you get into wholesaling doesn't mean you can't then give buy and hold a try, and vice versa. Do what best aligns with your priorities. Hope this helps, good luck!

Thank you for your advice and personal story Michael, I appreciate it. I will be sure to look into both of those investors you mentioned, and hopefully get a better feel for how to approach MFH rentals in the market. As for the LLC suggestion, I have been considering this but it seems to be a fairly common practice for newbies to get the first home under their own name then later start putting newer homes under an LLC once they're more established. Needless to say, I will look into it in more detail and see what best suits my risk tolerance. Thanks again!

Hi BP! First time posting, but I've been lurking this amazing site for about a month now trying to learn everything I can! As the title states I am from the Dallas, Texas area. Currently, a college student getting ready to graduate. I got into stock investing about a year ago, but a couple of months ago started to feel there must be a better way to invest which is how I ended up here. Despite not having any previous REI experience I have managed to become semi-obsessed with REI podcasts, audiobooks, and blogs (many of which belonging to or found through BP). To be honest, I don't necessarily see myself going full-time into REI anytime soon (I feel that would be counter-intuitive to the time I've invested in a non-REI related degree), but I am set on doing it part-time (the 'ole 9-5 job + REI life) once I graduate. I would consider house hacking and taking advantage of my access to college students seeking rentals, but since I am graduating sooner than a year (FHA seasoning period) and am quite uncertain as to where the job market will take me after graduation I plan to wait and learn in the meantime. I am aware there are infinitely creative ways of financing given enough time and effort, but I feel the options available to someone who has no steady income seem too risky and cut my margins for error more than I would like. My ideal goal (like that of many others on here) is financial freedom. I like the idea of taking advantage of the multiple wealth generating mechanisms Buy-and-Hold offers. I plan to purchase SFH or MFH using the BRRRR strategy because I feel it is a very good way of leveraging smaller amounts of money as long as you're okay with the risk accumulating debt has, you plan conservatively, and you don't try to grow too big too fast. I would love to hear any comments or suggestions anyone has for me! Current questions I am trying to understand in the realm of REI are:

How to determine what stage the housing market is in? (Currently in Texas it seems like a hot - seller's market. I know this doesn't necessarily mean there aren't deals, but is it wise to buy now when there's a possible dip in the future?)

What have naturally introverted people (like myself) done to get the ball rolling in what seems like a networking dependent industry of REI? (I have read time and time again that REI meetings are the way to go. Don't get me wrong, I'm not trying to avoid talking to people. I simply do not thrive in large events like that especially when most events that do happen to fit with my schedule are filled with seasoned REIs who I can't imagine would take a very young, inexperienced, college student seriously let alone be interested in networking. I have come across the idea of offering free labor/partnership in exchange for mentoring, but to my understanding the frequency this occurs at is few and far between.)

Best Wishes!

Chris