All Forum Posts by: Dan M.

Hello Tim,

Basically what lenders do is they will take the GROSS amount of income - in her case 401k and social security - and give roughly 30% of that monthly income into a mortgage. So say for instance and simple math if she makes 2000 per month she can afford a 600 dollar mortgage. Also it helps if she is able to put alot down, most lenders will only require 5% down if its a primary residence. She can also receive one "gift" from you to help with the down payment. I would just advise her to call a few local lenders and see what they will offer that is the first steps to knowing how much house she can afford. 

Says your in Pomona and sure sounds good. Who else is in :P 

Hello BP,

Is there any credible REIA's in the Hudson Valley New York area right now? If not I would be interested in co-starting one via Zoom and maybe have bi weekly meetings if anyone has interest.

I wouldn't recommend investing for negative cash flow unless you think this property is really going to appreciate or your going to take away some of the expenses like manage it yourself, which will still cash flow negative. But if you feel like betting why wait instead go to Vegas and find out if you win or lose the same day why wait years? Best of luck. 

Do you have a deal in mind you would like to share? Either option is fine and is a great way to get started investing. The great investor, Thach Nguyen, lived with his parents until he had twelve rental properties under his belt. I think ultimately it depends on the deal and what you want to do with your lifestyle. Delayed gratification can yield fantastic results but the trick is to get started one way or the other. 

My attorney always requires them as a contingency to close. It takes 3 seconds for the landlord to do it and if the sellers are unwilling there must be something else going on or must not really want to sell the property. Its possible in your case the agent did not want to bother the seller with "another thing" and felt being aggressive back was an appropriate response? 

Alot of good stuff here heres my two cents. Why not try to get a HELOC on a property or two from a bank that pays your closing costs? On your primary its even cheaper money and you can deploy it whenever you want, and won't have to keep a balance hanging over your head if you do not want to.

Joe is right in my opinion leverage is a beautiful thing which really increases your ROI. Borrow at 4 percent to make 10+ and keep the difference. You lose the potential peace of mind by having everything paid off, but if you do not anticipate problems and are prepared just incase you still have peace of mind.

If anyone decides to bundle properties together I recommend having an understanding with the bank that you could sell a property from the portfolio and not the whole portfolio so you have options when it comes time to sell if ever. I have a similar situation where I would just have to pay for appraisals if the time comes on the other properties in the portfolio to ensure the banks required LTV.

First off what State are you located in?

Second of course you can be a part time agent, I am. The brokerages make more the more you sell so they only want full time agents, also it puts your back to the wall where you will starve if you dont make a deal. The brokerage will not make a nickle if you do not make a sale, unless of course they charge you for leads etc. My personal advice I would forget them immediately for giving you information that only benefits them. Being part time I don't make a fortune doing it but its enough to pay the MLS dues , can be intrinsically rewarding to help people, and also any deal that I purchase I get a slice of the commission that a normal buyer would not receive.

1) Any of these strategies is a good idea. Personally I use normal websites like Realtor.com run an analysis and decide at what price I could buy where it makes sense to both the seller and myself to make the deal happen. If you want "steal deals" you could employee a number of tactics but this will definitely be slower than traditional purchases.  My personal stance is if its a deal that cash flows hitting a single is better than never swinging and getting the home run. 

2) I've done a number of things that some people do not think about. One huge way that people do not think about is taking a 401k loan. After you refinance it if you choose to do so you can pay it right back. Alot cheaper than hard money in the long run. I've used hard money, credit cards, eating ramen for a year. Its whatever your comfortable doing to get the ball rolling. 

3) All of my properties are in a number of LLC's. You pay extra for everything this way and noone wants to ever talk about it, higher interest rates, miscellaneous fees for closings, more headaches at the closing table, a higher tax return but you also get that liability shield ( in theory ) if god forbid something happens. Theres nothing wrong with putting it in your own name to save money I think in the beginning especially if your planning to house hack and use it as a primary residence and live there for a while. I think any "institutional" investor would say to create the liability shield but if its your first deal likely your not protecting billions of assets the choice is yours what you think is appropriate. If I could go back in time, of course knowing that nothing happened with my first few deals, I would have had them in my own name.

3a) Theres alot of what I'll call nonsense you have to deal with regardless if you use a realtor to close the home. The bank is going that you personally get alot of work done for them and you pay for it all, unless your paying cash. Realtors are going to have to do what they have to do for their own work which also requires you to review and sign things regardless. If I were you on your first few deals be as involved as possible to learn as much as possible. Kick back and sip Caronas on a beach once your retired and financially independent your first few are going to be work but it gets easier.

Hope this helps/ gives you some insight. Anyone will say thats made it will say just take action and do it even if you lose you gain valuable insight and find out if real estate is for you. 

At the end of the day talk to a tax professional. Linda has a great point generally speaking you get passive mileage but if you can justify to the IRS that your using this truck for work you could potentially lose the mileage and instead write off the maintenance payments etc its one or the other. Hope this helps.