All Forum Posts by: Account Closed

But the question still remains...Why in the heck are you buying your “Dream Home” when if you applied that down payment to an investment you would be able to take that money and pay down what ever debt you have in your name that is making your credit suck. I don’t mean to be so harsh but I too was In your shoes and should have done precisely what I am telling you to. Find an investment property if you do decide to purchase something.

BUT before then Work on your credit history/score. I don’t think you are ready for such a huge liability based on your score. Maybe work on paying down for a year then come back in a year and buy something that is proven to be an asset to you.

A great answer.

1 Vote

@Andre Crabb In the end, like everything, it comes down to the math and personal investment goals. You can refinance out of the FHA loan to remove PMI later also.

2 Votes

Originally posted by @Brian Medansky:

@Account Closed I wouldn't necessarily agree with that. Everyone is going to have a different strategy and a different "why" for investing. Yes, if you're able to buy a property you want in an area you want to house hack with that low down payment, that's great. That isn't always possible for every person.

That is a great strategy, but it doesn't jive with everyone's strategy/long term goal.

Yeah, I really should have been more clear. Many people do it because of the low down requirement/use other money to get another deal. Many don't have that DP assistance.

0 Votes

I'm new so take it for what it's worth.

Sellers typically use pro forma numbers, which are usually BS. However, the buyer is responsible for verifying info. Seller will likely request info on income/expenses/rent roll.

Prices are usually based on CAP rates (specific to local market).

Value = Net Operating Income / Capitalization Rate

edit: This applies to 5 units and above....1-4 units is more based on comps.

0 Votes

Originally posted by @Russell Brazil:

Since the beginning of the 20th century we have had 1 depression, and 2 housing collapses, and those housing collapses were 75 years apart. So Id spend my time worrying about things that are much more likely to happen, like needing to replace a roof, than worrying about things that are unlikely to happen.

And for those that survived the most recent housing collapse...the solution to surviving it was rather quite simple....dont sell during a downturn.

Sir, I have to commend you. Your responses are always so sensible.

2 Votes

Originally posted by @Mike Dymski:

Good locations
Add value
Cash flow
Long term debt
Reserves

Works for all market cycles.

Buy in locations where the risk of not being able to pay the mortgage for extended periods of time is zero.

Mike, I have had this same question in the back of my mind as we are about to close on our first property. You have calmed those fears with this post as I can check all the boxes. Thanks.

1 Vote

Originally posted by @Andre Crabb:

@Andrew B. Because I could still rent somewhere else for $1000 and get paid the $1000 from the unit which essentially cancel each other out. So buy buying without FHA I could skip living in it for a year and going straight to "Boom...instant investment property."

Right?

The other comments are about low down payments. Clearly one big benefit is FHA allows MFH properties which allows people to get into investing with low money down. But if that's not what I'm looking for then house-hacking doesn't necessarily seem like the best move.

I'm not sure I am following....but the point of house hacking is low down payments through primary residence loans (3.5% FHA, 5% Home Possible).

Otherwise you have to put down 20%-25%. It's about cash on cash returns/more capital to invest in next investment

0 Votes

Is this monthly? Where can I keep up with info? Moving to Charlottearea in a month.

0 Votes

Originally posted by @Jeb Brilliant:

@Cynthia Walker Where is the home?

Yeah, this is important as you may be over FHA limit I think.

Keep in mind you're on a real estate investing forum and you're buying what many (most?) here would consider a liability. Are you interested in real estate investing or just scouring the internet for answers?

That may be too much house for you. 100K income, I have learned, doesn't go as far as it sounds.

That dream home slipping away is likely a blessing in disguise. One time, we found our dream home in foreclosure. We put in an offer, bank was not interested in any offers as it was about to make it's way to the market (which it listed for a few thousand over our offer)...anyway, had we bought that house, we would have been in trouble as there was a job loss just a month or 2 later. Also, we would not be investing in real estate right now.

3 Votes

Just wondering if this is a good sign for buying...

Small town, tons of growth in the county....someone just built a 42 unit rent based on income smack dab in the middle of said small town. I wonder if they do things like this because they foresee people not being able to afford homes soon.

0 Votes

All Forum Posts by: Account Closed

Account Closed has started 29 posts and replied 150 times.

Post: Credit score 600, have 20% Downpymt,over 100k salary but DECLINED

Post: Non-FHA house hacking benefits?

Post: Non-FHA house hacking benefits?

Post: Assessing Sale Price on a Multi Family Apartment Complex

Post: How to survive an Impending Depression

Post: How to survive an Impending Depression

Post: Non-FHA house hacking benefits?

Post: Charlotte, NC REI Meetup - Tuesday July 3rd

Post: Credit score 600, have 20% Downpymt,over 100k salary but DECLINED

Post: A good sign for local market?