All Forum Posts by: Steve Dorman

A property is worth what either someone is willing to pay or what a mortgage company is willing to lend. The whole reason to sell FSBO is to pocket the 6% for yourself. Why would anyone bother to FSBO if the only benefit was to discount to the buyer?

So my wife and I are getting ready to relocate to another state. Once we find a new location I would like to buy a cheap fixer upper sfh to live in while we build our new lives. Of course when I go to purchase a place, neither of us will be working or have any w2 income. I will have some 1099 income - like maybe 20k per year.  I will have around 200k in cash though. 

What type of financing would be an option for us? Would I have to buy outright and then hopefully cash out refi after 3-6-12 months? Will a lender consider a refi based on equity alone?

I have had this plan to relocate in the works for many years but never realized how it might be difficult to finance a new place.

Well I figured it was time to check back in to the BP community. 

As it all turned out we went ahead with our plans. I sold my seasonal business in the beginning of 2015 ( around April) . It probably wasn't the best financial move but with the phone starting to ring I had to make a decision and a company came along that was manageable at best. 

We closed and liquidated our retail business in June of 2015 at the end of our lease. We still are in the process of selling off assets from that company (inventory) on craigslist and other outlets.

I am still operating my e commerce site. Might I add that it is a TON of work just to close or sell off a business.

As I mentioned before we built our first house when I was only 19, I think I was actually 18 but signed the paperwork right around my 19th birthday. We structured that deal when anyone could qualify for a house and we basically worked with a builder to finance the construction and we did a lot of sweat equity as down payment. Sweat equity included - framing, windows, siding, roofing, concrete flatwork, painting, trim, etc...Of course it was a lot of hard work building a house and working fulltime but we managed. The downside was he had a lot of "free" help and many aspects of construction were already builder grade products but they were also installed poorly. Nonetheless I have spent the last year now remodeling and fixing things in preparation to sell. Oddly enough it might have worked out as the market is really strong in our area right now.

I figure we will list our SFR house within the next month or two as we are completing everything.

So my numbers have changed a bit from my first post as I have been spending money on remodeling while supporting both my wife and I.

Projected financials April 2016: 215k liquid with approx 4k per month residual income.

Now once we sell our house and sell/store our personal belongings we are going on a 2-3 month road trip. Mainly to investigate where we would want to relocate to. I'm thinking Texas or Florida, maybe even rural Washington state. Worst case scenario we end up back in Minnesota, but I want to see what's out there. Also I would like to restart my seasonal business in a more accommodating climate whereas in Minnesota we only had about 7 months to make our money.

On the plus side we won't be needing much money for living expenses for a little awhile. I always use to joke about being house poor for so long.

I am still unsure where or what we will be doing professionally, but I do know for sure that I want to build a buy and hold portfolio in residential real estate. It seems like no matter what new venture I get into, I somehow get drawn back to this market.

In a perfect world I would like to relocate to a warmer climate and buy a cheaper/fixer upper house in my name only. I would like to open up the idea of my wife qualifying for a 4 plex fha loan if it's even still an option down the road - I think we would have to wait three years for her to qualify? Could I build a 4 plex and sell it to her under FHA? I guess now I am just rambling but my brain is full of ideas. I ordered some books today off of amazon and will be doing a TON of reading and researching to begin the next adventure.

@mikehurney I have not read that book but have heard it brought up in other forums. 

In regards to getting started...I am not worried. I work best under pressure. However I wonder what type of lender to look towards in the beginning. Thanks

I figured it was time for me to introduce myself to the BP community. So here I am. 

Background:

I am currently 30 - living in a cold, non business friendly state. I am spending my time and energy operating three separate businesses - one seasonal service business, one retail, and one e-commerce website. I am also married and own a SFR that I built when I was 19 - thanks to easy credit and sweat equity. But needless to say I am exhausted with the pursuit of making money. I don't enjoy or take pride in any of my current three businesses, but they make money - easy money. But I want to focus my energy on something I enjoy, and make an attempt at creating more passive income. Not that renting or flipping homes is easy money, but it's a lot easier to do something you enjoy rather than despise.

So earlier this year I decided that there is no point in working my life away anymore for the sake of easy money. Plus I've realized that with my time and attention split how many different ways, my quality and attention to detail is lacking in all areas of my life. So this year (2014) I will be ending my one seasonal business and selling it off. The other retail business will be liquidated in the spring of 2015 when our lease term ends. I will keep the e-commerce website for now so I still have some income. 

Come Spring of 2015 my life and finances will look like the following:

Me unemployed. My wife unemployed as she runs the retail store. We also plan on selling our primary residence and moving far, far south to a more business friendly state and warmer climate. Did I mention I want start investing in real estate? That is all well and good, but without any W2 income, I doubt many lenders will want to talk. Our credit scores are both 750+, and we have zero debt (wife has some student loans). 

Financially:

$100k from the sale of our house

$100k in liquid savings aka cash

$30k in retail store liquidation

$10k in additional savings and sale of personal items before moving

---------- Liquid Assets = $240k

$50k sale of business/structured owner financing $5k down/$2500 per month for 18 mos

$30k avg on e-commerce website per year

---------- Non W2 income per month = $5k for at least 18 months

A lot of personal info there, but I need all the details to formulate a plan. Ideally I would like to buy a cheaper house, fix it up and live there while we find a more permanent home. Then eventually just rent that out. However with interest rates so low I would like to scoop up ten properties and rent them all out. Maybe flip one house per year. 

Perhaps my first question should be....who will lend to me with decent rates but no guaranteed income? Sure I could pay cash but I really want to take advantage of low interest rates. 

Anyhow any feedback/questions are appreciated. I hope to really make some life changes in the very near future.