All Forum Posts by: Daniel Sabato

@Tony Le Claire That helps a ton Tony! I don’t have any debt currently! Some minor monthly expenses but nothing high or out of the ordinary. I just finished college in May & I’ve got a stable full time job without any student loans. I’ve also built up a solid credit score making minor purchases throughout college. 

The only worry I have is that my DTI will be an issue once the mortgage payment is factored in. In reality, I'll be able to rent out one of the two units, and I will live in the other unit with a few friends, so I'll actually be living for free & positively cash flowing, with a good cushion for potential issues/disasters, but I know that's not how it'll appear on paper unfortunately.

@Marcus Payne @Caleb Heimsoth @Jed Devine 

Thanks for the tips folks! No credit card debt or any debt for that matter & my credit score is solid! Just finished college in May & I’ve got a solid & stable full time job without any student loan debt. Hoping the process goes painlessly, this would be my first time applying for any type of loan! Any recommendations as far as lenders or where to get the processs started? I’m in NJ if that makes any difference!

@Harjeet Bhatti Thanks for the response! That’s basically what I was wondering so you pretty much answered my question. Getting the pre-approval process started is generally the first step I take it? 

Hey everyone! So I'm planning to buy my first property towards the December area, give or take. I'm wondering if there's anything I should be doing now in regards to the loan process and whatnot. I plan to take the owner occupant route and only put down around 5%. I was wondering if the process takes a bit more time if your down payment is lower. I assumed there would be more hoops to jump through. Any steps anyone would reccomend taking now or in the near future? Thanks in advance! Also any reccomendations for lenders would be great too!

@Chris Sellers Thanks for the help Chris! I agree the best way is to gauge the surrounding area for similar properties. Zillow has rent estimates and I find them to be rarely accurate. I think their formula is based on the size of the property and amount of bedrooms, but doesn't take into account the quality of the unit or even the area it's located in from what I can tell. 

This is one of the reasons I feel that buying properties in your own market gives you an edge because you understand the pricing in the area.

Does anyone use any specific websites or programs to determine what rental rates might be in a certain area? For example, I see a 4 bedroom house and I want to figure out what I can rent that out for, which is crucial in my analysis before buying the home. Generally I use zillow, realtor.com, trulia to get a feel for it, and I also try to look for purchases only in my area where I'm familiar with prices and what is normal to charge. Sometimes I see prices that seem super low to me, but I'm also not an expert in the area so it's tough to say. Does anyone have any tricks or anything that they use to figure it out?

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@Eric C. Yes 750$ is really cheap rent for the area

@Frank Chin Thanks for the reply! In a perfect world I would rent out Unit 1 and their payment would cover the entire mortgage for me to live for free upstairs. In this case, that isn't going to happen. I would be looking at paying $750 a month, but after year 1 I would rent out my unit and collect rent for both units! The long term is what I'm really looking at here after Year 1 !

This is my first post on here! Big day, anyway I've got a discussion topic that I was hoping to receive some feedback on. This is the Long story short version without MANY details. I'd also like to mention I'm not asking for answers! Just opinions and discussions! Felt like this would be a good topic for many people!

I've come across a multi-family duplex that I'm interested in purchasing. I don't love the price but it's reasonable. If so,  I would plan to go the owner-occupant route, and probably put down 3-5%. Being that I've got to live in the one unit, my cash flow for the first year, or lack there of, would be terrible. I would end up losing about $9,000 after it is all said and done. That includes everything outside of utilities of course so essentially $9,000 for me to live there. I've also factored in repairs, vacancies, insurance, mortgage etc, Just didn't want to list them all. What intrigues me, is that after the year is up, assuming I can successfully rent out both units (Plenty of what if's and assumptions here) , my cash flow would shoot through the roof, 45% cash on cash return to be exact. I'm making assumptions about rent prices and an array of other things for the sake of this discussion. I'm well aware there's plenty more to consider and calculate of course.

Has anyone ever engaged in a situation like this? Personally, it doesn't sit well with me. I don't like the idea of losing money for a year and it basically goes against all my rules of investing. But the upside is what intrigues me and I live in area with really good access to NYC and has a super low vacancy rate so I'm confident it will rent after I move out. Any feedback and info is more than appreciated.