All Forum Posts by: Francois G.

@Alex Cipollone Hey Alex,

I’m with the above posters about considering Suffolk County. Cheaper taxes and there’s some new developments coming in the near future that should improve the local economy. If you don’t mind the extra commute it’s worth looking into.

As far as books, there’s a ton to choose from and some popular ones have already been listed. Brandon Turner’s book is one of my personal favorites which you already mentioned and David Greene’s book on out of state investing is a great one if you consider investing outside of NY. The Millionaire Real Estate Investor is a classic one but IMO it’s really outdated and doesn’t include the power of the internet (written in the early 2000s I believe).

Out of all those professions you asked about, the contractor is going to be the toughest one to find. Hands down. You might also find that a lot of investors don’t like to give out their contractor. If you can’t get a referral, trial and error is probably going to be your best bet.

Good luck to you my man!

No worries at all. It's an unfamiliar situation for many of us so I'm open minded to any solutions.

She's not looking to rent the property. This is actually a case that doesn't involve any investing at all (I'm a realtor also so it's a potential buyer). She's trying to buy her first home and is in this situation. It's a situation I haven't dealt with yet so I was interested in getting feedback.

That's what I thought. For what it's worth, she technically hasn't quit her W2 job yet (she's still receiving unemployment benefits from the job). She just hasn't returned and doesn't plan to return. Her best bet is probably returning, get the house, then quit if she still wants to.

Hey,

I was looking to get some advice from a lender regarding financing for a potential client I'm working with. Long story short, she was in the hospitality industry for years but now she wants to "work for herself" as an aftermath of Covid. She's quitting the hospitality position to become an insurance agent.

The issue is she's a first time home buyer who's looking to buy her first home by Halloween. From my experience, lenders are usually looking for 2 years of consistent income from self-employed workers which she obviously doesn't have yet. The hospitality position was a W2 position which is much better for her getting a mortgage.

My question for lenders is that even though she quit her W2 position in March, can't she still use her W2's from the last 2 years to apply for a mortgage? She might not currently work there but she has years of W2's to show consistent work history. She's also been collecting unemployment since March without any other income which I'm sure is going to hurt her also. 

Would the previous two W2's be sufficient enough to prove her work history even if she's currently not at the job? Obviously, in this situation it's probably in her best interest to apply for the mortgage while those W2's are still effective, correct? How bad does it look to lenders when unemployment insurance is the only income she's had since March (we're in a global pandemic so not sure if this is something lenders even consider)? I'm hoping on a call with my personal lender about this in 2-3 hours and would like to know how to approach it to give the potential client the best chance possible at qualifying. Any input is appreciated.

Thanks in advance!

@James G. You also have to consider the buyer pool when/if you plan to sell. You can sell a SFR to anyone where as with MF you're going to mainly attract investors, and investors are usually looking for deals under market value (at least you should be 😉).

Depending on the construction, you can still have a good buyer pool with duplexs. When you get into triplexs and up is when the average buyer pool drastically changes. There’s pros and cons to both so it comes down to what works best for you.

If you're going to put 80% as a down payment, IMO you're better off waiting until you earn that other 20% and just buy the property all cash. Obviously the strategy that gives you the most leverage would be to put 20% on 4 properties instead of 1 property but it looks like your financial situation is going to make that tough.

You have a great credit score. The sub $20k in income the last 2 years is what's going to make it tough. Have you thought about HML then refinance? It looks like you're going to have to get creative with your financing but it can certainly be done especially with that credit score and amount for a down payment.

Hey Kenneth,

I see you're from NY. It's hard to recommend somewhere without knowing what your goals are but Pittsburgh has been good to me regarding cash-flow in the northeast. PA in general has landlord-friendly laws that makes it better to invest in rather than NY. 

Sam,

There's very few places on Long Island where you're going to find buy and holding profitable. It's a great market for flipping properties but you're going to find a hard time finding deals that make sense financially for buy and holds.

If you're even somewhat tech-savvy, I would highly recommend out-of-state (OOS) investing. The numbers will make a lot more sense for you and you'll quickly realize it's not much different than investing in your backyard.

I was born and raised on Long Island so I know how difficult it is to leave. Home prices and taxes have priced too many people out of here and the laws are too tenant-friendly to be considered a wise investment. 

If you have any further questions feel free to send me a PM.

It's human nature for people to hang on the methods that made them successful so it's not surprising for men that age to say that. Success is also a subjective word that only you can define. Your success and their success can and probably will be two different perspectives.

The internet and the resources that come with it have provided a whole new realm of possibilities when it comes to investing. The old time investors that are successful in today's market (at least what I've seen from my clients) are the ones who have advanced with the times and embrace the new technology that's provided to them. They continue to find the best deals today because they're not stuck on old-school myths that made them successful in yesteryear.

Networking is so important when it comes to out of state investing. You need to build the right team and it's not going to happen over night. So if there's any advice I can give you it's to optimize technology, build your network, and learn construction basics. I think if you have those 3 down then you're ahead of the curve in this game.

Good luck!

What kind of investing are you doing? I haven't read through all these comments so if you mentioned it my apologizes but that would be important to your goals for obvious reasons.

If you're being priced out of deals due to where you live, OOS investing is always an option if done correctly. Where I live in NY, buy and holding isn't even an option but flipping properties are great depending on the market. The key to OOS investing is being able to manage a strong team so if you can do that efficiently, the opportunities are endless.

The $20k you have saved is more than enough for a down payment on an FHA loan for a $300k property. Since you mentioned the "hot market" (I'm assuming hot seller's market?) I'm guessing your looking to flip but in that case I would probably have some more money saved. This goes back to the strong team I mentioned before. A lender on your time can be a direct source to get the funds you need.

But don't just jump into a deal because a market is hot or any other emotional aspect. ALWAYS run your numbers. If they make sense, pursue. If they don't, on to the next. I would be happy to discuss this further in a PM to make sure I understood what you're asking. Feel free to reach out. Best of luck!