All Forum Posts by: Fernando Zavala

@Max Reznik

I am exactly where you are right now.  I run numbers and think it is too good to be true.  I must be missing some expenses.  Below are some numbers:

$300k purchase price, 25% DP, $225k loan @ 5%

Income - $2800

Mortgage P&I - $1208

Taxes - $300

Insurance - $200

Management - $200 (me)

Maintenance - $200 (me)

CapEx - $200

Vacancy - $200

TOTAL EXPENSES - $2508

CASH FLOW - $292

And yes, the only way we will ever find out exactly what it costs is to finally get in and do something.  I am in St. Louis and looking at the surrounding area and there are many similar properties. I hope I have over-estimated some costs and if so that it would drive my cash flow higher.  I want to apply this to a property and then do it again and again and think to myself 10 times and that is $2,920/mo and that would be making an amount good enough for me to quit working the man and just work for myself.  

Hello all,

I am glad I found this site and will be here and on youtube reading/listening/watching and gathering as much information as I can to prepare to make the move to get started. However, just as I start to make a plan I run into information that is opposite of what I began planning and have to do more research to find out which information is best for me.

For example, I was going through gathering information on how to start my LLC and then I read it was not necessary and that insurance was all that I needed to get started.

My thinking for the LLC was that I would put everything under it and that eventually the LLC would be generating income and based off that income it would allow the LLC to be approved for more loans.

This is where I need to find information. My credit is fine, but I was hoping not to have to use it to buy properties. I was hoping to use the LLC's credit to buy properties. I was thinking of establishing the LLC, opening a business bank account and depositing $20k and using those funds to get a loan to purchase a home then rent it out, show that as revenue to a bank, and proceed to buy another home, and slowly rinse repeat with cash flow or breaking even with the long term goal being that the mortgages get paid off in 15 years to where eventually the renters go from paying down the mortgages to paying for my early retirement. It's probably not as simple as I just stated, but why not think big?

So, I have a good job, a car payment, student loans, some credit card debt.  If banks will use my income to debt then it will be very difficult to get approved let alone work my way to a second or third or fourth home.  How does it all work?  If I get $1000 as income for a home and the principal, taxes, insurance, vacancy, and maintenance are about pretty close to that $1000 then how will a second home be possible if the income to debt will be out of line of what banks approve. 

As you can see I have alot of questions that I need to find answers to before I dive in and go for it.  I want to own single family homes, duplexes, and smaller multifamily 3-10 unit buildings.