All Forum Posts by: Josh Dillingham

@Kendra Mattson based on what the realtor told you it sounds like you have a realistic chance of getting the appraisal you need. and if you do you will save around $100 per month in PMI (just a guess, maybe more)for an investment of $600-800. it depends on your risk tolerance but that is a gamble I would be willing to take.

starting local gives you the advantage of knowing the market.  fewer deals can also mean less competition.  I live in a town of 10,000 people.  It took me four months of looking to get my latest deal under contract because there aren't many properties that meet my criteria in my town but when It did come on the market there wasn't much competition and I got it under contract without having to get in a bidding war with 20 other investors as might be the case in bigger markets.

it's all about your risk tolerance and overall goals. 

Questions to ask your self:

-What is my interest rate on my mortgage?

-if I had a mortgage could I make a return greater than that interest rate if I invested the money I would have because I mortgaged the property?

Example: if you have a $50,000 mortgage at 5%, could you make more than 5% return if you invested that money in more real estate?

real estate is an equation.

Holly,

If they quoted you between $750-3500, as a rough start just split the middle and use $2,000 when running your numbers, then when you find a house you are seriously considering making an offer contact the ins. company to get a more precise number, or you can contact the insurance company after you are under contract.  After getting a few quotes on different properties you will probably find that you are able to estimate the insurance price pretty close. one thing that will really make that number go up is if the property is in a flood zone. 

What does your lease say about giving notice at the end of the lease period? does your city/state have any specific laws about giving notice at the end of a lease period?  if there isn't anything in your lease and no law on the books I don't think there is anything you can do.  If there is something in your lease or a law you can probably keep the security deposit up to the amount of notice the tenant was supposed to give. Regardless you should get the place ready to rent and advertise immediately.

Chanise,

if they have to do a hard pull of your credit to give you a new pre-approval letter I would say the most it would hurt your credit would be 5 points, but it may not effect it at all.  as far as switching lenders, if you can get the old lender to renew the pre-approval letter without doing a hard pull that would be your best bet.  Even if you plan to switch lenders it would probably be easiest for you to stick with the same lender for the pre-approval letter, then when you have an offer accepted you can reach out to other banks.  the pre-approval letter doesn't obligate you to get a loan from that specific lender it just says to the buyer "hey look, there is a bank willing to give this person the money they need to buy my house."

-Have all three roommates sign lease agreements just as you would if you were renting the whole house to them.  Some of the terms of the lease would be unique to your situation.

-you would be able to treat the parts of your house you are renting out as rental real estate and you will be able to deduct and amortize expenses incurred for your rental business.

ask yourself the following questions:

-if it was a rental what would it rent for (check craigslist for similar rentals in your area)?  what would all your expenses be?  rent - expenses = monthly cashflow

-if you sold it how much do you think it would sell for (check Zillow to see what similar properties in your area have sold for)? how much would you get after real estate agent fees, taxes etc? 

as an example, lets say that if you rented the property you would get $400 per month in cashflow, and if you sold it you would get a lump sum of $150,000. 

the question then becomes would you rather have $400 per month and a property you could possibly sell later, or would you rather have the $150,000 to invest however you want right now? 

@Cassie Chun your inspection report should tell you what is a major problem and what is minor deferred maintenance.  My inspector puts things in separate categories based on how important it is.  If I were you I would contact the inspector and ask him specific questions about the report and how immediate and or severe the issues are. 

I don't think of any one issues as a "Deal breaker." Turn everything into a math problem:  how much will it cost to repair? do my numbers still work after that?  if not, lower your offer price accordingly and if the seller doesn't go for it, find another deal.  sticking to the numbers and the facts removes a lot of the emotion and anxiety.

@James Beaver I can't view your report any longer.  did you pay cash or did you get a mortgage.  if you got a mortgage of 80% and the property is still worth the same amount you paid for it you won't be able to pull any money out because you don't have enough equity.