All Forum Posts by: Grant Schroeder

Justin, is your income all primarily all Schedule E or also Schedule C through Sole Props/LLCs, etc? The great thing about Depreciation, Taxes, Mortgage Interest on Schedule E, it can be added back as income even if you show a net loss on your Schedule E properties. 

How long ago did you purchase your primary with cash? I also sent you a connection request, so please feel free to message me details if that is better for you than posting on the open forum. Thank you!

@Carlos Lez This is definitely a little strange from FRB. Is this a conventional loan or a portfolio loan? FRB keeps a lot of loans they originate on their own books.

@Jonathan Gordon you can use your equities assets to help qualify from an income perspective on a convenitonal loan. It's called non-traditional income, and not many lenders know about this or understand it. Lenders can take 70% of your $1m and divide it by 36 months to give you a qualifying income. Then your liquid $400k can go to downpayment and closing costs on multiple properties. You would still be able to have qualifying income without a W2. I have used this strategy a lot with retired clients who are either in between retiring and taking SS or starting 401k withdrawals, but have cash and good credit, just not "traditional income" from a lending perspective.

You can also look to BRRRR or go with a DSCR loan as was mentioned above, but this non-traditional income path is definitnely the most straightforward if you are just looking to purchase several rentals for passive income outside of the stock market.

@David Kelly The VA allows for a W2 cannabis employee loan, but it is the specific lending institutions like Loan Depot that have an overlay that does not allow it. It is different with conventional loans, but many lenders do not want to touch the cannabis industry due to its risk even if it is newly legalized in some states.

Great work @Owen Schwaegerle!

Love your feedback @Dave Foster!! Spot on.

@Eric Giovannucci I definitely agree with you there on Canyon county. I was using the “Boise basin” terminology more for out of state investors not familiar with the area. Most of the investors I have been helping have been in Fruitland, Homedale, Caldwell & Nampa, with just a couple on the other side of the state in Idaho Falls. Like you said, Boise itself is a little overbought as far as residential investments go.

@Linda West we love all the learning that comes with REI! Have you looked at AZ or ID at al for out of state investing? Tucson, AZ and locations in the Boise, ID metro are still higher in rent, but still slowly trailing behind in price points.

@Tobias Joneses, @Dave Foster is right on! I am working with his firm and a client from BP purchasing in AZ.  Our client was able to get an off market property so he didn’t have to compete in the open market fortunately. But like Dave said, definitely try to identify a replacement property ahead of time or right as you are preparing to list. It is also good to make sure your lender understands your timelines and sense of urgency. If you have a lender that can help you close in 20-25 days tops, that will definitely help your timelines. 

It may be worth your while to do some direct mail marketing to find something off market and ease your timeline worries?

One thing to be aware of when you purchase in California, is that your property taxes are automatically reassessed at the purchase price x1.25% within a year of closing on the new property. When you buy, the property taxes may stay lower in your escrows per the old assessed value since the assessors office is about 1 year behind. So even if that current assessment is lower, the property taxes will jump quickly after a year or so and cut your cash flow significantly. Whereas, if you have held your current property for a while, the assessed value has slowly crept up from where you purchased it years ago. California is one of the few states that this automatic reassessment at 1.25% of purchase occurs because they sure do love their taxes. 

Thank you for posting @Daniel Molina! I would definitely lean toward starting with a house hack if the numbers make sense. It’s a great way to gain hands on experience slowly as you begin to build your rental portfolio. Let me know if you have further questions about how to make this work!

Hello @Nina Cisneros and welcome to BP! I just sent you a connection request so please do not hesitate to ask questions. That is truly the best part about this community. There are so many great resources to draw from as you continue to learn and grow along your own journey.

I plan to do the same thing for my kids and love this approach!