All Forum Posts by: David H.

That's good cash flow for that investment.

@Lupe Rodriguez I think the specific rules will depend on the type of investing one is going for but you typically will see the same things mentioned over and over in that field. So like for buy and hold strategies, things like dont over pay for the property, don't take on a huge renovation for your first deal, always screen your tenants, make sure it will cash flow positive without banking on appreciation, collect a security deposit, etc... Sometimes in the beginning I find it's easy to justify not following these things, but without experience doing say it can get you in trouble. You just dont know what you dont know so better to follow the guidelines than start behind the eightball.

@Michael Junior Just to put some numbers to your example. Say you buy the duplex for $60k, you put $15k in it. And the improvements brought the value up to $100k. Then you do a refinance at 75 percent LTV which gives you your 75k you put in it back. The same works if you had financed the initial purchase you just have to make sure that the you get the house at a price such that when you make the improvements it will appraise at a value that will allow you to get your money back at 75-80 LTV.

@David Harley Most banks will do 75 LTV. There isnt a perfect way to evaluate ARV but you get better with experience. I find it's really helpful to look at the zillow map and see what has sold recently nearby and look for similar size/ condition houses. That usually can get you pretty close

@Brian Ellis It's taken me some time to learn that as well. Many ppl are far more unreasonable than I expected and will take advantage wherever they can. It's not my personality to be overbearing but I've found I have to show some rigidness or will get taken advantage of

If your feeling in a million a month who cares about investing lol

@Edgar Butler Jr I'm using a local bank to do the purchase. They only require 15-20percent down and it's an 20 yr ARM so the payments are really low. Then after 6mos I can refi it with a standard bank to a conventional 30yr loan. There may be others that dont require the 6 mos I just haven't looked as its easy this way for now being I know them all. I could also buy the house with this bank but they require 25percent down and are a little stricter on appraisals of houses that need work. But this bank will only do 4 properties so I will have to figure something else out after my next house. I think the bank I am using on the initial purchase does portfolio lending so that will enable me to get 10 properties but I'll have to figure that out soon.

I think your plan looks solid. Everyone just needs to keep in mind this is a plan not the playbook so it doesn't have to be exact. There are probably some holes in it but you will figure that out as you go. And I'm not sure I agree on staying in the current job at half price as it depends on the salary. At the end of the day they are going to look at your yearly earnings and if its double that is factored in. It would be good if your base puts you at a quantifiable level. If not then you may have some issues until you can show the full years earnings. But if it allows you to save up money that fast then it's hard to argue against.

@Edgar Butler Jr I am doing it this route as well. Only downside is I have to wait 6mos to refinance as the bank likes to see it rented that long. It's not an issue right now but may be later if I want to speed things up

Man that would erk me that they are trying to be snakes like that. I would just come in strong and tell them look these were not yours and were included in the sale of the property. If they resist I'd just let them know Whether it was listed in the listing or not it's the reality of the situation and if you take them I will be filing a police report and will go to small claims court and include all associated costs I incur in the claim. I dont know that just because it's not in the listing that you have lost leverage. Typically whatever is owned by the seller becomes the buyers upon transfer so you immediately owned them upon sale unless stated otherwise so the renter should have no right of possession there. It's not like the seller put them outside and the renter can then claim possession. It went from the buyer to you. I dont know the legality there but that would be my stance. If after telling them that they still took it. I would probably just look into it and then decide. In all reality it may not be worth pursuing because you can get those appliances off craigslist for a couple hundred bucks. But I would make them think I'm gonna come after them for it.