All Forum Posts by: Tyler H.

Anyone?

Looking for advice, creative or traditional. I'll try to keep the post simple.

My goal: To add additional SFH rentals to my portfolio. 2-3 in next 6 months

My RE history: Investing/managing my small portfolio of 3 houses for 10 years. I have a proven method that provides good cash flow, however that's not the point of this post. Recently became a Realtor to assist in my RE career, and need a few more props so I dont have to rely as heavily on the Realtor aspect as I am probably more of an investor at heart.

My problem: 

A) 6 months ago I settled a 2nd lien on one of my props, which included a series of late payments. Its the only derogatory on credit, and currently sitting at 720. Im pretty sure this puts me out of any conventional lending aspects. From my last inquiry with a lending broker, its going to be 1-2 years seasoning after lates /settled for less. Second problem with conventional is I have been self employed, and my tax returns are not showing fantastic numbers over the last 2 years.

B) I have, or can come up with the 20% needed, but need to finance the rest.

C) Already tapped personal circle for private money, no bueno.

D) Considering portfolio loan, although with only 3 props, I would need a MIN 2 additional units for that to work. Then there is problem.... C1) 2 of the 3 props have good rates. 2% stepping to 3%, and a 4.25% 30 year fixed. Third prop isnt bad at 6.4%, but its variable although it hasnt moved in a long time. If I go this route I will be losing short and long term benefits in interest rates.

E) A commercial LOC secured by the props would seem optimal, although Im not sure if they will take being in the second position. Or if it would be based on tax returns..?

F) Hard money. Read alot about it, never tried it. Pretty sure they only do deals with 40-50% equity. So not sure this is the solution. Plus, Im looking more long term.

I need all you pro BPers to analyze my situation and give me your best possible advise. Prop A has little to no equity. Prop B has 80-100K equity. Prop C has 150K equity. Is there a way to tap this equity and keep my good current rates in order to expand?

THANKS TO ALL. I APPRECIATE IT.

I have seen some Realtors ads a few times while waiting for my car wash.... Ive also seen similar at gas station pumps. (static print ads). Can any Realtors share their experience with this? Was it worth it? How many leads did you receive? Etc.

I have always been curious about it, thanks in advance.

The S8 seems to be above market. The area is not too far from apple valley, Antelope Valley. S8 Max's are

3 BDRM $1775 -- 4 BDRM $2430

Right now you can easily find 4 BDRMs for 100K or less. I would not expect $2400, but right now my 3 BDRM is getting $1600. I would think $1800 shouldnt be a problem, and at those numbers, thats a pretty great rate of return!

Yes some of the major cons with S8 is the possibility of bad tenants. Like mentioned many other places on BP, tenant screening and selection is crucial. One thing I have seemed to notice is because S8 is currently CLOSED to new applicants, the current voucher holders seem more motivated to stay in line. Some of the repair costs will be limited as I am looking at newer tract homes. Many of the other cons are the same as all rentals.

How many other places do you all know about where a 4 bdrm can be purchased for 90K and rented for 1,800???

As previously mentioned, I already have 1 S8 in the same area. It is break even for me because I bought it at the peak of the market. Prices have plummeted and S8 still has high rent prices. I want to take advantage of this opportunity, and hopefully to the fullest extent. I figured I would bounce my plan of of BP, in case I was missing something, or maybe someone had something that would give me a better edge....

Please elaborate rather than take the time to post a negative comment......

These are not advertised CAPs, these are my calculations. The area I am looking at is receiving higher S8 rents than the private market... And from some research I have done, I see many people (companies) buying and renting out S8's in the same manner as I have planned...

Quick history: I currently own 2 homes. 1 S8 rental, and 1 primary residence. Both purchased pre RE collapse as pre-construction with 100% financing (irrelevant)...

I see a large disparity with the prices of certain homes Im looking at, and the potential Section 8 Income. For example, I see houses all day (even through MLS) for less than 100K. These same houses will rent for $1500-1900. Some have CAPs over 20% and cash flows over 1K each!

Seeing this, my instinct is to buy as many as I can! I have a sec8 rental now and I am aware of the pros and cons (thats another topic). I have checked with the S8 department to verify market rents. I am currently in a good position to buy because I have reserves, the credit, and SOME cash to work with. My Q's are this...

1. Thoughts or opinions from experienced investors?
2. What might I be overlooking here?
3. What would be the fastest way to acquire as many houses as possible?... I can probably get 2-3 single handedly, but will need CREATIVITY going from there.

Does this FHA guideline apply to 2nd's only? My 1st is HAMP modified, and doesnt need to be touched....

Any other creative ideas out there? Private Investor or a business loan should give me a lower rate right?