All Forum Posts by: Ed Wood

in my opinion if your market has them and you are a buy and hold investor everyone should be looking at 4 units! : )

Why? because conventional loans only allow you to have 10 loans so why fill the slots with anything less than 4 units! of course maybe nine 4-units and 1 SFR as your primary...

You can but there is a trade off. Low rate = appraised value. High rate = ARV....

local agent can probably get you that info from their board of realtors

You're on the right track, with that rehab loan from the bank season the loan 6-12 months so you can refinance at the new appraised value pulling cash out. You'll have cash in hand and a nice low rate and payment 30 year fixed conventional mortgage.

After doing 1-4 unit mortgages for all types of borrowers for the last 12 year I've learned a lot from these investors. Not one of them has ever said it was a bad decision buying their property I would say all of them would probably say it was the best thing they've ever done.

Here's my plan take from it what you will (I wish my parents knew enough to do this).

I have two kids and soon as they turn 18 I will have them buy a 4-unit using FHA 3.5% down and a blood relative (me) as a non-occupying co-borrower and source for down payment. FHA you can use 85% of the rental income to qualify too so I may not need to be on the loan. When the property appreciates enough to pull cash out I will have them pull cash out for a 25% down payment on another 4-unit property. Continue this cycle until 4 properties are owned and financed. Then from 5-10 properties the down-payment will need to come from other sources or obtain seconds because you can not leverage by doing cash-out refinances with more than 4 properties owned and financed.

*As a side note, at any age if someone is living in an apartment with the FHA opportunity you might as well go out and by a 4-unit because on FHA loans they let you use the rents as income to qualify, this has to be one of the greatest opportunities allowed by FHA or any other loan program.

there are many websites you can join for a monthly fee that will provide the information.

Just to step in here so people buying SFR, Duplexes, Triplexes and 4 Units. For conventional financing lenders do not look at the DCR, Cap Rate or Cash on Cash Return they look at a borrowers overall debt to income ratio using the borrowers personal income W2 or self employment and sometimes the rental property income depending on the program and borrowers landlord experience less the borrowers primary mortgage PITI and other monthly liabilities.

tl;dr

responding just off the subjectline

my opinion... if not college go into insurance (house, auto, life) build a nice residual income...then get into real estate.

I've thought about this as well. It reminds me in the the late 80's car companies were offering 1,2,3% interest then started offering 0% consumers started expecting this and it's still around today.

Difference between a car loan and a mortgage being the secondary market determining interest rates so unless sellers are willing to buy down interest rates for buyers otherwise I think the secondary market will be what it will be...

1. The trustee will ask a broker for a opinion of value in BK case from the start.

2. If the trustee has the property sold it will probably be listed with a agent for highest and best offer.