All Forum Posts by: Denise Mayo-Walley

Hello BPers,

I currently have one buy and and hold investment property and I am eager to acquire a 2nd. I met my Realtor today and saw a property that fits my criteria but is also in great shape and therefore can be listed for rent almost immediately. The market in my area is insane and I do not want to miss out on this property which meets the 1.2% rule (not unusual for my market).

So, here's my question. I have access to a LOC that uses my investments as collateral as well as a HELOC that I can get access to very quickly. This will afford me the opportunity to place an all cash offer with quick closing. Now, here is where I get a tad confused. So after closing, then what? I have spent most of the evening reading through old forums, Google-ing and trying to understand my options and figure ways to determine which option is best.

I was thinking I could 1) use the LOC to purchase the property 2) do a refi of sorts after closing and pay off the LOC (amount will be less because of the max LTV being somewhere around 80%) then 3) use my cash to pay off the LOC.  This way I can end up with a conventional 30 year loan and will have used my LOC to get a better price on the property.  However, doing it this way will not allow me to use my cash to buy more properties as I will essentially still be putting 20% down on the house.

Does that plan sound doable and is it a smart thing to do or do I need to purchase Brandon's book on No and Low Money Down strategies to make my cash go farther? lol

Thank you for your time!

hello @Gretchen Diercks ! I somehow stumbled across the meetup organized by Charles Nguyen here on BP several weeks ago. If you look on Meetup.com the event was posted under 'Real Estate Investors of Houston' and the event name was 'February BiggerPockets Meetup.' It was held on 2/19 but I was not able to make it. If you join that group there you should be notified of any future Meetups. 

Welcome to BP @Carlos Moreno .  I too am in the Houston area and I purchased by first investment property in July 2014. So far, so good! I too am in the medical field and looking for a way to retire before I am 40. I mention it all the time, but people think I am joking! lol

I plan on becoming more active in the REI meeting scene so maybe I will run into you at an event. I am currently a member of RICH but due to how far it is from my home, I rarely attend any meetings. But, the price is very reasonable and I still consider it to be a good resource - just wish it the office was closer.

Good luck!

Hello BP community,

As I prepare to purchase my 2nd SFR I am once again considering obtaining my TX real estate license. I really want to obtain my license so that I can view properties without having to call up a Realtor and for increasing my knowledge of transactions and real estate markets. I have some questions that are hard to find answers for given the immense number of posts to sort through here on BP.

I am curious whether anyone in the Houston area has been able to find a broker who charges minimal fees for 'hanging' your license.  I have no interest in representing sellers or buyers -- I only want to be involved in my transactions. If you have found a broker, what are the costs? I am trying to make an informed decision. 

I am also aware that there are active and non-active distinctions and would like to know which I would need for my purposes.

Thank you so much for your help

Thank you @Joe Villeneuve  and @Christian Bors for your responses! I guess I was being hard on myself as usual. Perhaps I should celebrate actually taking the first step of buying my first investment property.

Thanks again!

Hello All,

I am a new REI in the Houston area and I closed on my first property on June 26th. The sellers leased it back until August 8th and therefore I've had it for 2.5 weeks. My initial post giving the figures and asking for help analyzing the deal is here.  

I purchased the property after viewing it once, especially given the ridiculous number of offers, and I felt like I got a good deal. The rent to purchase price ratio is 1.22% which is good for Houston from what I see. Of course with all the furniture removed from the home I started to notice things I had not planned to fix in the home. My initial budget for repairs was $2500 - as I was planning for carpet, paint and elbow grease to clean the bathrooms.  Well 2.5 weeks later I looking at about $4000!  The two big ticket items were paint $1500 (1200 sq ft home with peeling paint on door frames and new paint needed for all interior doors) and $1100 for carpet ($0.85/sq ft @ Home Depot). Other things include changing a light fixture, installing GFCI outlets, new range, repairing a broken window, purchasing 2 new mini blinds, securing gutters and changing locks on the doors.

I say all of the above to ask whether this amount seems average for a 1200 sq. ft. home in decent condition though it was built in 1980.  To add to things, there are now more rentals on the market in the neighborhood with nice upgrades and asking for the rent I thought I could get. I presume that those properties were purchased as foreclosures or off-market.

Did I over do things for my first rental or did I not follow the ideal of 'money is made when you purchase the property?'

All comments are welcome!!!!!

Thank you!

Hello @Jason B. I am in the process of purchasing my first investment property with plans to lease it out and am sitting back reading everyone else's advice on choosing a PM or self-managing. Sorry I do not have any advice but thank you for allowing some of use newbies to learn from your experience.

Also, I'd like to learn more about how you were able to obtain financing for multiple homes at once. I have my eyes set on a second property but haven't closed on the first.

Thanks

Hello @Lyall Storandt - for the closing cost I used the Bank of America closing cost calculator. I am actually using a BOA 30 year 20% down mortgage. I do plan on speaking with them and getting a more accurate estimate of closing costs. Their breakdown included the following:

• BOA fees $1523
• Third party fees $2728
• Estimate prepaids and insurance $898
• Estimated escrow account funds $722

After seeing so many homes fly off the market and also not having an offer submitted over others, I may have to be willing to accept less than spectacular offers. I know that purchasing a home requiring work would result in better cash flow but I really do not want to jump into rehabbing for my first purchase.

Any thoughts about the closing costs?

Thanks!

Thank you SO much guys for your responses!

@Patrick Parry - the property is pretty much turn key. Only needs a little paint. It's in really good condition. Perhaps I will try working with wholesalers on my next transaction. I am definitely thinking long term and I do have a great day job.

@Dennis Rodriguez - Thanks for the reassurance and suggestions. I took a look at the Fort Bend County appraisal records for previous years and it looks like the owner did not claim any exemptions, however I chose to use the most recent appraisal rate and calculate taxes based on the current rate.

Thanks again!