All Forum Posts by: Erin Anderegg

As a fellow house hacker in a similar situation, I empathize!

If your financial situation permits the $650/month expense, and you can still save for reserves (for this property and your other one) and have enough money saved to buy your next residence, it seems pretty good. A 15% ROI at the end of year 1 is pretty great, as long as you can stay afloat for the first year (and maybe the 2nd year if your plans need to change). Definitely consider what @ Dan Crosby and @ Taylor L. mentioned as well.

Hi Veronica!

I can't speak to any Chicago-area specifics because I don't live there myself, but I wanted to give you some ideas of what to do to prep for a coffee meeting with someone who does.

- Pick 2-3 suburbs you are interested in- make a list of reasons why you think these would be good places to invest.

- Research for current market rent for various bed/bath combinations.

 - Find 2-3 SF or duplexes in each area on Zillow, Trulia, etc.   Compare the market rent to the amount of money needed to cover the mortgage and/or creative financing payments.

-Other things to consider: there should be quite a bit of money available after paying the mortgage/creative financing to cover repairs, vacancy, saving for expensive items like a roof, and maybe property management if you're not managing it yourself. If there isn't an additional $250-$350/month at minimum, it's going to be hard to cover any unexpected repairs (the number might be different in your area).

- In looking at some properties before you meet, you might find a great deal, in which case you have an excellent conversation starter with a potential partner.

This should give you some options to present to someone who is more experienced so they can answer some questions you've encountered, and you can start to zero in on the best areas to invest for a return, even if you don't find a perfect property right away.

Hope this helps!

Thank you all for the insight, very helpful! I won't worry about preemptive protection and just inspect for damage on a regular basis.

Hi all,

I was curious if anyone has experienced termite trouble in Michigan. There is a pest control company that is recommending protection against them, but I wanted to know how much of a problem they truly are. Generally speaking, it seems to be more problematic for warmer/more southern states from what I have heard. Any input is welcomed!

Thank you for the ideas, Eric.

Just today I listened to the Bigger Pockets real estate podcast #585 where similar house hacking questions were discussed with similar options and creative solutions. It seems like the most straightforward option is to leave the FHA in place, and use a different low down payment loan product for the second house hack. Maybe in another year or 2 the first original house will have appreciated enough to refinance to a conventional 80% LTV and allow for another FHA use on the 3rd house hack.

Yes, I am aware of the 12 month time frame stipulation. Our plans are to stay at least that long, but I wanted to start looking at options so I'm prepared when it's "go time" in October to either refinance or start looking for the next property. Are there specific loan products that do 90% LTV? So far the highest I've seen is 80%.

Home possible program I mean.

Thank you both for your insight. It's helpful so far! I have some ideas for forcing appreciation, but not sure if it's enough to get an adequate LTV. I will be sure to check on the Homepath program and see if there are other Michigan specific opportunities.

Hello!

My husband and I have lived in our duplex while house hacking for about 6 months and are initiating plans for our next house hack. Our current mortgage is an FHA loan where we put down 3.5%. We want to do another FHA loan for the next property, but I know you can only have 1 FHA loan at a time.

Do we need to refinance the duplex to a different loan product before searching for the next property? If so, has anyone had success with high LTV loans in this case? I haven't had the place appraised since we were under contract, but I doubt it's increased enough where we have 20-25% equity at this point.

Thank you Drew, that story is helpful. In your experience, could those issues be avoided with rigid screening? Or would rigid screening negate too many people where no one would meet the criteria and it would stay vacant? It seems that there is a fine line, and it gets more challenging with lower classes of properties.