All Forum Posts by: Cody Steck

Haha, @Bill Gulley After reading that, I'm never leaving! 

No, but I completely agree. I plan on fulfilling everything I agreed to. I'm just that kind of person. I was honestly just curious. 

@Anthony Gayden 

If it is close enough to the one year I think I would be OK to simply wait it out and fulfill that requirement. I could still buy the next place and have 60 days before I have to move into it.

Thanks for the tips. 

I came across a duplex that has good numbers and looks like a deal. Seller is asking 175k and has about 152k left on the mortgage. They said they would be willing to carry back the difference if you took over the loan. I then found out that the loan is an FHA which nullifies the chances of assuming the loan because you have to owner occupy (as far as I understand).

The seller said they spoke to another investor which already has 10 properties and wanted to do a 'subject to' deal and pay the mortgage through a third party? Is there a way to do this? I guess it is possible this owner could occupy it but I highly doubt it.

Any creative ways out there to get around this that I am not thinking about? 

So, it sounds like it is possible. Yes, the hard part is finding the deal with that amount of 'meat'. Thanks for the help!

@Albert Bui Basically, I am asking if you can find a property at a good enough price to be able to buy it with hard money and then do some rehab and still be able to add enough value to cash out after 6 months and get enough cash to pay off the hard money and maintain 75-85% LTV.

How does the bank know if you are fulfilling your one year owner-occupied requirement? Does this change if you move out but don't actually have a tenant until after the one year is up? I'm not saying I am going to do this but I would like to start house hacking once my one year requirement is up. I want to start looking early to give me plenty of time. However, what if I find the right place before that one year is up? On a side note, any suggestions to perhaps get around this and start house hacking earlier? I plan to keep my current residence as a rental so selling is not really my first option. Thanks!

@Albert Bui So if you use your own funds, you can cash out before 6 months but if you use hard money, you have to wait 6+ months? But it is still possible to actually cash out at that point. 

@Albert Bui Can you explain further the exceptions to using HML for this kind of deal?

Are you saying that you cannot use a HML and then cash out and refinance? Does this vary bank to bank?

Originally posted by @Nathan Emmert:

To do this you either need to buy significantly under market value (purchase equity) or be good at renovations (essentially you're a flipper "selling" to yourself).

Cash rules... there are no questions about it.  Dependent on your risk tolerance, the general answer is to leverage highly given the low interest rates and preserve your cash to continue to invest and grow your portfolio.

Let's say you paid cash for the property to begin with and then are financing for the first time when you are ready to cash out. Is the lender going to look at your DTI, credit, etc the same way when deciding on whether or not to loan to you just like they would if you were getting a loan for a primary residence? Or will they be a little bit more lenient considering (theoretically) you will have the 20% equity already?

Do you think they might also consider rental income if you have a lease already signed? For instance, a local broker mentioned to me that if you have 30% equity and a signed lease, you can use part of the rental income towards the loan qualifications.  

Personally, I prefer 100% in person. I am new to real estate, but, for sales in general, definitely in-person.

You can tell so much more about a person by their body language. You miss out on that over the phone. You can see when they are nervous, you can see if they like the price you just offered or if you just shot them in the foot. You also get to show yourself, you get to show confidence via body language while in person. 

Yes, it is a bit more of a hassle to have to physically show up, but for me, I feel I will be 10x more successful if I negotiate in-person. It gives me a confidence that I sometimes seem to lack when on the phone.