All Forum Posts by: Cory Manoogian

 Ooohh gotcha, gotcha. I was confused about the timeline. The deal you mentioned didn't line up with 16 months, but it makes sense now there were 4 other deals. Nice deals, congrats!

 You didn't turn 100k into 550k, you turned 100k into 170k, so you made 70k in 16 months (net profit - capital investment)

Hey everyone,

I've found a property, settled on price and received a quote for a loan: 3.5% 30yr. But I had some questions revolving around strategy and how to allocate money.

I can currently save $1K/month from my job salary, and I was wondering what your opinion is on the allocation of my savings plus the property cash flow (CF) - excluding the part of the property CF that will be going into a contingency fund. So here are the options I'm considering.

1) High CF as possible and save as much as possible for downpayment on next property. This would entail a 30yr loan allocating all property CF (except for money going towards contingency fund) and $1k/mo to savings

2) Lower property CF and put all saved money into reducing remaining principle. This would entail a 12yr loan (just enough property CF to put all of it towards my contingency fund), put all of my savings towards paying down the remaining principal. Goal here is that I'll be able to refinance the house much quicker and perhaps have enough money for the downpayment of two houses.

3) Somewhere in between

I'm very interested to read about your take on this. This is my first property I will buy, so I'm very new, very green and you opinion and/or advice is greatly appreciated. Thank you!

Hey everyone,

I've found a property, settled on price and received a quote for a loan: 3.5% 30yr. But I had some questions revolving around strategy and how to allocate money.

I can currently save $1K/month from my job salary, and I was wondering what your opinion is on the allocation of my savings plus the property cash flow (CF) - excluding the part of the property CF that will be going into a contingency fund. So here are the options I'm considering.

1) High CF as possible and save as much as possible for downpayment on next property. This would entail a 30yr loan allocating all property CF (except for money going towards contingency fund) and $1k/mo to savings 

2) Lower property CF and put all saved money into reducing remaining principle. This would entail a 12yr loan (just enough property CF to put all of it towards my contingency fund), put all of my savings towards paying down the remaining principal. Goal here is that I'll be able to refinance the house much quicker and perhaps have enough money for the downpayment of two houses. 

3) Somewhere in between

I'm very interested to read about your take on this. This is my first property I will buy, so I'm very new, very green and you opinion and/or advice is greatly appreciated. Thank you!

@Dan Beaulieu, my girlfriend loved your comment, lol. I talked to one a few months back and got turned off to going that route - definitely didn't offer anywhere close to fund 100% of the deal. I'll definitely call more than one HM lender this time.

Thanks for the tips!

Thank you all for your advice so far. After reading your comments, I have a few more questions:

I've been weary of hard money lenders as their interest rates destroy a properties cash flow, at least that's what my CF models illustrate. Any opinions on hard money lenders from you all?

Second, I have already lived in my house for one year and some of you suggested moving, which I am open to. But I bought a house in an area that is undergoing gentrification and the house value has demanded a mortgage of $2300 for a 3 bed, 2 bath, 2 car garage, 2022 square feet property. The house is in the Royal Chapel Estates. Can I rent my property for that much? This may be a hard question to answer, but thought I'd ask anyways.

Thanks again for the advice!

Paul, you're correct, I've been looking primarily in South Dallas. In my CF models, I've found worst case scenarios to be negative and best case scenarios to cash flow around $200-$300. Perhaps better to start somewhere then nowhere? Or would it be better to to save more money, and if so how much money should I save up, what home value range should I be targeting, and where would such a home be located within Dallas?

Also, why would BRRRR be risky for me?

Sorry for all the questions.

Bruce, that is a great idea. I have asked my partner to make contact with her employer to see if I can pay for a turnkey investment. I think they would like to see a younger couple succeed, but the employer is also extremely prideful of his houses and may not want to let any of them go. Worth an ask though!

I don't quite understand your second advise. I can stay in my current house for a year and would be open to moving to a new primary residence, but could you explain the benefit of that just a little more, please?

Thanks,

Cory

Hey everyone,

I'm looking to buy my first rental investment property in Dallas, TX (and surrounding suburbs) and I am in the process of identifying the property and doing research with lenders. My partner (and gf) is a property manager for a single investor with 100+ houses and I believe she has a pretty good handle on identifying good properties and being able to estimate how much a repair cost would run. I have a cash flow model that I use and am confident in my ability to appropriately forecast future cash flow. I have to rely on my partner for the repair cost estimates and I have included contingency costs in effort to remain conservative. 

I recently bought a house for my primary residence and have learned that my job and credit score are both a non-issue for banks. I have $25k in cash that's just sitting around and am looking to invest it. I understand that I don't have a lot of cash, and as such I am limited to buying properties that are likely under $100k due to the 20% required downpayment that is often required to get a loan.

So now that I've set up the background, here are my questions: Is $25k enough to acquire a good investment property, when considering downpayment and likely repair cost, or do I need to save up more money? In your opinion, if I buy a property, is it likely that I'll be overpaying for the property given the rapidly increasing home values?

I'm interested in receiving your advice. 

Thanks,

Cory