All Forum Posts by: David A Lisowski

Quote from @Jay Hinrichs:

WAAAY to much liability..  Golf carts and kids,   Golf Carts and drunks,  Golf carts and people that simply cant drive well no matter what kind of vehicle they have. 

Exactly. Golf carts are treated like toys because people have vacation brain.

Would you provide a car rental for your guests, or leave a car available for them to use? I think not.

But a golf cart with less safety features, uncapable of traveling speed limits on roads, no doors, children often traveling without car seats or boosters (that people spend hundreds of dollars on to keep their kids safe in the car), kids/teens/drunks driving illegally, etc.

It's providing a vehicle for use, even if it is a "golf cart." It is required to be a street legal vehicle.

As local in a full-time beach town, I hate everything to do with golf carts.

It *might* make your property stand out, but if that's the determining factor for someone renting a place or not, they can always rent their own golf cart.

As others have mentioned, partner with a local company and give vouchers or discounts if they want to rent their own.

I have plenty more to say on this topic, but that's for another thread.

Haven't heard what AI art is doing to AI art?

Cash-out refi before selling so that your capital gain is under the $500k cap for joint filing.

However, having the property listed for sale will hinder any refinance options.

But if you C/O refi and then list the property for sale after, then you shouldn't have any issues.

@Adriel Cisneros

That's correct. You will not be able to refinance into a conventional loan using an LLC on title. Government-backed loans (FNMA, FHLMC, FHA, VA, USDA) do not allow LLCs.

So if you transfer title to LLC, then go to refinance, you will have to transfer back to your personal name in order to close the refinance loan.

@John Cervera

I would recommend you speak with a CPA, tax accountant, or estate planner, but the simplest solution (from a form lender's perspective):

• Get added to title and then refinance/HELOC after seasoning requirements (usually 6 months).

Yes, my current HELOC is in I/O draw mode. We are looking to renew the lease, but we have also listed the property for sale. If sold, the HELOC will be repaid, but it is not attached to that property.

Otherwise, the HELOC is I/O (draw) for another 7 years. It does not get used much, if at all, and we make regular payments to reduce the principle as well as any accrued interest. So overall, the balance is decreasing, and we are on target with the payments to having it paid off by the end of the draw period.

Otherwise, we'll probably have it refinanced and hopefully tap more equity. But we are waiting for my wife to establish her self-employment history on tax returns. So beginning next year, we can consider refinancing the HELOC.

Quote from @Joe C.:

David, what are the financials like? Expected rent, property management, expenses? Thanks and good luck!

We had all property expenses covered by the tenant's rent along with $1,000 paid to the HELOC each month, as well as approximately $900 for capital expenses, repairs, vacancy etc.

For the 6 months in 2021, we didn't make much, but the tenant stayed until Oct. 31, 2022 so we have 10 months rent in 2022 rather than 6 like in 2021.

Paint, landscaping, cleaning, etc. for the turnover is approaching $3,500 so that is taking a bite out of the income. I would have painted (and saved about $3,000), but with a 9 month old, it just wasn't feasible to try and do.

Hoping for a new tenant, or we will list to sell in 2023.

Sorry for such a late reply

FHA, VA, and USDA do not fund investment properties.

Don't lie to get a "better deal" because mortgage fraud is serious.

Sorry, but that's about as far as I made it before commenting.

I'd say you need to decide on a what type of investment you are looking for and pick a strategy that will accomplish that investment goal.

Buy and hold long term rental?

Buy and hold short term rental?

House hack?

Primary to investment property conversion?

Buy, fix, and flip? (Sometimes referred to as the BRRRR (Buy, Rehab, Rent, Refinance, Repeat) strategy)

It looks like you mentioned a VA loan? And a loan pre-approval?

I don't believe the VA does investment properties so you'd have to purchase the home as your primary residence.

And was it a pre-approval with an underwriter approval, or just a pre-qualification? Things are different in each process (essentially, pre-qualification means nothing other than you have good enough credit).

You mentioned some interesting properties, but are you finding these retail (i.e. Realtor, Zillow, through an agent, etc.) Or are these considered off-market deals?

The best thing to consider when looking at a deal is having accurate information and numbers on the costs/expense, the loan/financing, and income (either actuals or proforma estimates).

Run scenarios at the ideal conditions and the worst case. Would you tolerate the worst case numbers? Could you? For how long?

Does the area offer potential growth and equity gain?

Also, know your "Outs." At all points in the process. At all stages. You should know what an exit strategy would be at any given time. From when you make an offer all the way through owning and operating the investment.