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All Forum Posts by: Varinder Kumar

Varinder Kumar has started 68 posts and replied 334 times.

Post: Assisted Living Facility

Varinder Kumar
Pro Member
Posted
  • Realtor
  • LA & ORANGE COUNTY CA
  • Posts 351
  • Votes 128

@Kevin Vandenboss

Thanks for the info. Question: is it possible to fund the down payment on the real estate and then borrow say $100K for rehab with a SBA loan? 

Post: Assisted Living Facility

Varinder Kumar
Pro Member
Posted
  • Realtor
  • LA & ORANGE COUNTY CA
  • Posts 351
  • Votes 128

@Shane H.

Interesting. I was just thinking the same for a facility I am currently looking to purchase. It would be held in our LLC and was wondering if I can get a SBA for it. PP is $1.5M. And for the SBA does it come with a lower down payment? We want to keep cash on reserves for Reno and other carrying costs until the business is up and running. Thanks

Post: HELOC Orange County, CA

Varinder Kumar
Pro Member
Posted
  • Realtor
  • LA & ORANGE COUNTY CA
  • Posts 351
  • Votes 128

Looking to do a HELOC on my home. home value is $550,000 amount owed is $350,000. Any one know any place which gives great rates? I am in orange county, California. Tanks

Post: Current situation. What would you do?

Varinder Kumar
Pro Member
Posted
  • Realtor
  • LA & ORANGE COUNTY CA
  • Posts 351
  • Votes 128

@Karen O.

So if owner occupied you don’t have yo pay capital gains tax? Capital gains tax only applies to investment properties? Thanks

Post: Current situation. What would you do?

Varinder Kumar
Pro Member
Posted
  • Realtor
  • LA & ORANGE COUNTY CA
  • Posts 351
  • Votes 128

@Karen O.

Rent is $2700 mortgage is $2400.

Post: Current situation. What would you do?

Varinder Kumar
Pro Member
Posted
  • Realtor
  • LA & ORANGE COUNTY CA
  • Posts 351
  • Votes 128

I currently own a sfr. Current loan amount owed is $358,000. Current value of home is $550,000. I have rented this out for the past 3 years and am wondering if I should sell and take equity to put down on another property or should I take a heloc. What’s the best way for me to leverage my equity? Please advise thank you

Post: City finally adopted ADU laws, time to get to work. Need advise

Varinder Kumar
Pro Member
Posted
  • Realtor
  • LA & ORANGE COUNTY CA
  • Posts 351
  • Votes 128

@Cathie Kovacs

Thanks for the enlightenment. I did not think about that factor. So how would it work if i am living there and do the adu for airbnb, but then later want to buy another home for me to live in with my family. What happens the the sfr and the adu?would I have to put a long term tenant in the adu? vs short term (airbnb)? Thanks

Post: City finally adopted ADU laws, time to get to work. Need advise

Varinder Kumar
Pro Member
Posted
  • Realtor
  • LA & ORANGE COUNTY CA
  • Posts 351
  • Votes 128

My city has finally drafted out their laws for building adus in accordance with CA law. I am looking to build a 300sqft ADU for Airbnb purposes. Luckily my street with wide enough so i do not need to have a dedicated parking spot.

I wanted to gather some insight from my fellow BP'rs. Currently I have a single family home which has been rented out to my tenants for the past 2 years and they are going on their 3rd year. My goal would be to have the ADU build which will take up half of the backyard space and the entire side yard, so that guests can enter.

I would obviously run this by them and hope that they would be willing to still stay. My questions is, how should i best present this? What can I use to make it worth their while so they stay, eg. lowering the rent? Also how much do you guys think it will roughly cost to build a 300 sqft studio like structure with a kitchen, laundry, and bathroom. 

i appreciate the help, let me know if more detail is needed. 

below are the guidelines for the adu in accordance with the city. 

A. Purpose. The purpose of this section is to establish regulations governing accessory dwelling units, in compliance with California Government Code Section 65852.2, and to provide standards for the development of accessory dwelling units (ADUs) so as to increase the supply of smaller and affordable housing while ensuring that such units remain compatible with existing neighborhoods.

B. Development Standards. Under the provisions of this section, each accessory dwelling unit shall comply with local building code for detached dwelling, as applicable, and all development standards contained in Division 3, with the following exceptions:

1. Location. ADUs are allowed on lots zoned for single-family or multi-family residential use which contain or are proposed to be developed with a single-family dwelling. ADUs may be attached, detached, or located within existing primary residence, or accessory structure.

2. Height of Structure. Height of a detached accessory dwelling unit shall not exceed the height of the associated primary dwelling unit. Any external access staircase for the ADU shall not be located at the front of the house.

3. Setbacks. An existing garage that is converted to an accessory dwelling unit may maintain the existing setback. An accessory dwelling unit that is constructed above a garage must maintain a minimum 5-foot setback.

4. Number of Dwellings. A maximum of 1 accessory dwelling unit shall be permitted on lots where legal primary single-family dwellings are allowed.

5. Dwelling Size. The floor area for an accessory dwelling unit shall not exceed 30 percent of the residential floor area of the primary dwelling or 600 square feet, whichever is less, and minimum area of 150 square feet, or as specified in Section 17958.1 of the California Health and Safety Code.

6. Number of Bedrooms. The accessory dwelling unit shall be limited to a maximum of 1 bedroom.

7. Off-Street Parking. One parking space per accessory dwelling unit shall be provided. These spaces may be provided as tandem parking on an existing driveway, or on a driveway in side yard and rear yard as permitted in Table 19.320.030-C and Table 19.320.040-D of the Zoning Ordinance.

No additional parking for the ADU is required if any one of the following conditions are met:

a. The accessory dwelling unit is located within 1/2 mile of public transit.

b. The accessory dwelling unit is located within an architecturally and historically significant historic district.

c. The accessory dwelling unit is part of (i.e., contained within) the footprint of the primary residence or an accessory building.

d. When on-street parking permits are required but not offered to the occupant of the accessory dwelling unit.

e. When there is a car share vehicle located within 1 block of the accessory dwelling unit.

8. Garage Conversion. For those ADUs created through a garage conversion which meet the criteria in subsection 7 above, the parking required for the primary dwelling unit shall be in compliance with the current parking requirements as specified in Chapter 19.336 of the Zoning Ordinance.

9. Access. The accessory dwelling unit shall utilize the same vehicular access that serves the existing main dwelling unit, unless the second unit has access from an alley contiguous to the lot. No passageway connecting the accessory dwelling unit to a street is required.

10. Way Finding. Each unit shall display address in compliance with the current California Residential Code as adopted and amended by the City.

11. Utilities. All utilities servicing the accessory dwelling unit may be metered in conjunction with the primary dwelling, in compliance with Government Code Section 65852.2(f).

12. Infrastructure. Accessory dwelling units shall not be allowed where roadways, public utilities and services are inadequate. The property owner shall provide evidence that adequate parkland, fire service, sewer, streets, and water are available for the accessory dwelling unit based on standards and thresholds established in the following:

a. 30% of Park Land Dedications and In-Lieu Fees as computed per Chapter 18.64 of Title 18 of the Buena Park City Code.

b. Compliance with all current State and local building and fire codes.

c. Compliance with Minimum Street Width – STD. 104 Standard Plans City of Buena Park Department of Public Works.

d. Sewer connection shall comply with requirements for Depth of Flow (D) versus Diameter of Pipe (d) in sewer pipe as shown below:

Diameter of Pipe (d)Maximum D/d
8″ to 18″0.50
21″ to 60″0.75
Over 60″0.75

13. Architectural Compatibility. The accessory dwelling unit shall incorporate the same or similar architectural features, building materials, and color as the main dwelling unit on the property. These features shall include, but are not limited to, roofing material, roof design, fascia, exterior building finish, color, exterior doors and windows including, but not limited to, ratios of window dimensions (i.e., width to height) and window area to wall area, garage door, and architectural enhancements.

14. Ownership and Occupancy—Owner Occupancy Required. One of the two units shall be occupied as the primary residence of the owner of the lot. If the owner occupies neither unit, the accessory dwelling unit shall not be used as a dwelling unit, and shall not be rented.

15. Deed Restriction. Before obtaining a building permit for an approved accessory dwelling unit, the property owner shall file with the County Recorder a declaration or agreement to restrictions, containing a reference to the deed under which the property was acquired by the owner and stating that:

a. The accessory dwelling unit cannot be sold separately;

b. The accessory dwelling unit shall be considered legal only so long as either the primary residence, or the accessory dwelling unit, is occupied by the owner of record of the property;

c. Minimum rental term shall be no less than 30 days;

d. The restrictions shall be binding upon any successor in interest and ownership of the property and lack of compliance may result in legal action against the property owner to compel compliance with this section.

16. Submittal Requirements and Application Processing. Any application for an accessory dwelling unit shall include a site plan, floor plan, and elevations substantiating and evidencing compliance with all applicable development standards. Where all requirements of this section and the Buena Park City Code appear to be met, the application shall be approved ministerially without discretionary review or public hearing in accordance with the following conditions:

a. An accessory dwelling unit shall be permitted ministerially with a building permit if it is located within a Single-family Residential zone, and:

i. Is contained within the existing space of a single-family residence or accessory structure;

ii. Maintains independent exterior access from the existing residence;

iii. Side and rear setbacks are sufficient for fire safety. Fire sprinklers are not required for ADU if they are not required for the primary residence.

b. An accessory dwelling unit, which is in compliance with all applicable standards and does not meet criteria in subsection B.16.a. above, shall be reviewed ministerially pursuant to criteria listed herein.

c. An accessory dwelling unit shall be permitted with a discretionary review pursuant to Section 19.128.020 of the Zoning Ordinance (Conditional Use Permit) for those units which do not meet all applicable development standards. In no case may an accessory dwelling unit be larger than 30% of the primary dwelling unit, or be permitted where inadequate infrastructure exists.

Post: $10,000/mth Passive Income

Varinder Kumar
Pro Member
Posted
  • Realtor
  • LA & ORANGE COUNTY CA
  • Posts 351
  • Votes 128
@Balane Frece I have a similar goal my self, in regards to the target number monthly. Here is how I am going to do it. I call it “the mullet”. So I have a SFR already with long term tenants. The backyard has enough room for me to build a 1 bedroom studio, which I am going to Airbnb. So you got a long term tenant in the front and short term rental in the back. Business in the front and party in the back- mullet. Lol. But in all seriousness my goal is to have two “mullets”. Let’s look at the numbers... I purchased my SFR/LTR for $406K. With a balance of $355K remaining. Generating $2700/monthly. Now to build the STR in the back is going to cost roughly $70-80k. Based on my location I am looking to have a vacancy of about 5 days a month, tops. With a per night cost of $99 to start and some nights a higher amount, holidays, weekends etc. So this amounts to about $2500 a month. So I am looking at a ROI of about 2.5 years on $80K. With me so far? Keep reading... Now I am looking to duplicate this process. And by generating $2500 on the STR and $2500 on LTR (front house) I’m looking at $10K a month. With my career I have I should be able to have all of this free and clear in less than 10 years. Of course there are other factors involved and thIngs can go south in cwrtaIn ways. But to be honest thIs Is the best way in my professional opinion. MINIMUM INPUT AND MAXIMUM OUTPUT. Feel free to PM me to discuss other details. Hope this brings some clarity and good luck!

Post: Will the bank call this loan due when dropping the PMI?

Varinder Kumar
Pro Member
Posted
  • Realtor
  • LA & ORANGE COUNTY CA
  • Posts 351
  • Votes 128

Depending on the contract it would determine whether or not there is a "due on sale clause" But honestly it really depends on the lender. Like @Account Closed said "banks are not in the business of calling a performing note due" their business is investing in debt and collecting interest, "velocity of money" etc. I would not bring attention to myself, just leave it the way it is until it comes up otherwise.