All Forum Posts by: Evelyn Roper

Colin, depending on how long you have owned your primary duplex and how much equity you have built up, you may be able to cash out refinance your current home and invest that money toward the next place?  Just make sure your new refinance payment still allows you to cash flow and your debt to income ratio (after the new purchase) will be under 42%.  I am new, have only done one rental deal, but that is how I did it.  Interest rates are much lower now than when I initially purchased so my original mortgage payment didn't go up much even after the cash out refinance. If you financed your primary with fha and have been there a year and are willing to move, you might refinance the first into conventional, pull cash out and finance your second through fha (if you are willing to move into the second for at least a year).  The costs of doing the loans may be prohibitive if you don't already have significant equity built up.  Again, I am new, so definitely not an expert but I wanted to share the options I have considered :)  Best wishes!

If you used fha, I assume you are living in it?  I believe you have to live there a year before selling or moving out but am not certain on that.  You would also owe capital gains tax due to owning it for such a short time.  I am pretty new, so hoping others will chime in and educate us both.  Congratulations on finding a good investment property that cash flows in California.  

I opt to pay a little extra every month.  Even $50 will make a good difference, especially if you are in the beginning of the amortization schedule.  I use bankrate.com's calculators.  They allow you to see when your payoff date is with extra payments (either with a one time pmt, monthly, or annual).  I would say it also depends on your interest rate.  If it is high, devoting a little more makes a big difference.  Find a happy medium.  (I don't work for bankrate, just like their calculators).  

Sounds very profitable to hold onto for at least a few more years in my opinion.  Congratulations on making a great deal!  How long ago did you purchase it?  You've already got an incredible amount of equity in it!

Check with your insurance company as many will deny coverage if you have pit bulls.  I believe that if the dog bites someone on your property you could be held liable.  

An acquaintance of mine that worked in a shipping industry said he would never move his family into a (used) container home (or even reuse pallets for furniture).  He said there was no telling how many chemicals and dangerous substances were transported in/on them.  They may have been used in a country that allows chemicals that the EPA has banned here in the US. May have been subject to a spill and could contain carcinogens, etc. There is just no way to know what you are getting.  Obviously, if you build with brand new containers you would have less to be concerned about.  My friend may be overly worried but what he said made sense and changed my thoughts.  Definitely not trying to be a downer, just something to think about and add to the discussion.

If it is a rent to own then my guess is the required payment does not show up on her credit report.  If it doesn't, then I would keep the note and continue to let the tenant pay down the mortgage.  Continue saving what you can and when the other property comes to market, you will be in a better position to purchase.  The only issue I would be concerned with is IF the tenant were to move prior to the note being paid in full, would you have enough in reserves to continue payments on both properties until it could be re-rented?  If you can manage that, I think it would be smart to keep the money you have available for other upcoming opportunities.    

It all depends on the neighborhood, I think.  If you're in a lower class area, a brand new custom kitchen isn't necessary and you won't likely get a good return on your investment. People who have money for the custom kitchen would rather be in a better neighborhood.  If you are in a higher class area, putting in generic fixtures may cause the home sit on the market for a long time. My goal is to find a balance of the two.  Offer something more than the comparables in the area  (for a quick sell) without over building for the neighborhood.  Look at comparable properties, prioritize what needs to be done.  If you still have a budget left to upgrade and still turn a profit then add the things that will place your property in higher demand.  A $200 front door might be reasonable for some areas whereas a $200 front door would be considered a cheap fix in another.  I like to add a nice tile backsplash in the kitchen and upgrade bathrooms with tile shower surrounds because I can do those myself and they add a lot of value.  This is assuming you are flipping.  I know with rentals, many prefer the pre-fab shower inserts.  You really need to know your market and what your long term goals for the property are to decide what makes sense.

@Mark Gallagher I wouldn't recommend flat.  It may hide imperfections but the first time you have to scrub anything off of your wall, the paint will come off with it.  I use Olympic One and Valspar (usually five gallons at a time) and am happy with either.  I usually get satin (for trim)  and semi-gloss for walls.  For me, flat is only useful on ceilings.  

Today I spent a few hours removing nails from hardwood flooring that we will be restoring in the living room and hallway of our investment property.  The flooring is circa 1955 and has loads of character.  It is 7/8 inch thick so I couldn't quite let go of it!  Tedious work, pulling nails.   More than once I've thought of giving it up and buying new!  Also, I removed 1950s tile from a fireplace surround.  Yesterday was spent budgeting  all the way through next year's (projected) finances for upcoming repairs that we are having contracted out.  This is our first project strictly for investment and the costs make me nervous.  I prepared next years budget just to be sure I am not getting in over my head.  I probably could have used my time more wisely (who likes pulling nails?) but am glad to be moving forward and staying on budget.  Slowly but surely, we are getting there!  Our first contractor will be out Wednesday!  I do feel those activities (while sometimes boring and often lacking in a feeling of "accomplishment") helped grow our business because we are a little closer to where we are going than we were last week.  Keep on moving forward :)