All Forum Posts by: Huong Luu

@Maveen Ahluwalia Connect with a mortgage agent to confirm you can quality for a 5% d/p on a 4plex. You will be limited to distance and usually an investment property will need 20% d/p. If you get a MFU and rent it 100% then you are limited to driving distance for work. However, if you plan to house hack/ live in 1 unit, then you will be limited by distance. In addition to the $80K you have, you should plan to have 2-5% for closing cost. Good luck 

Good for you @Kalpana Arivazhagan for leveraging your HELOC. Take the time to learn to run your #'s and make sure you have sufficient resources and understand the risk of using your HELOC to buy an investment. If you end up going into negative cash flow, you are still responsible for the HELOC pay and the principal should the property go into default. In addition to what

@Chris Baxter mentioned, connect with  a mortgage agent that will be able to help you get a mortgage in that area. Not all agents can fund it if the property is in a smaller town. 

If you message me, I will send you a GC contract and breakdown excel sheet that you can have your GC fill out so you are talking the same language as them. I would suggest you contact a few flippers and see who they use. One technique a flipper taught me was to include a delay clause in the contract and a decreasing incentive. Many contractors will not accept the work due to the penalty, so you need to be able to negotiate the time of when this comes into affect and the extra buffer for time and cost overrun, along with adding in extra funds for the incentive. It is better to pay the incentive and have the work done on time and good quality so you can make rent income over cutting the cost and then having the place empty for a longer period.  I have a contractor I use for my properties in Toronto, so would be happy to make the referral. 

You can also set your project up on milestones, so they get paid a percent at each step. 

@Tony Li What is your plan with this property long term? Look at your long term plans and the tenant profile you want. It is usually better for cashflow and risk to have 2 units, however you can get higher rents from family who don't want to hear or share walls with another family. 

Run your numbers on the cost to unpin and total reno, and the time to get the funds back. Remember to factor in holding cost and buffer for reno to run longer. $300K growth is a lot of room. I would see if the bank will refi you after the reno since the ARV is good so you get all the reno money out. Although the basement is 400sf, you can rent that as an added office/work space or bachelor.

Suggest you also look at waterproofing, egress and insurance concerns. Also talk to your accountant as this may affect your taxes.  I have someone I can refer to you about basement/foundation/construction work - just message me. 

Good luck

@Cameron Chambers If you put the funds into stocks and you lose, then you won't have the funds to buy a property when you find the right place. If you are looking at RRSP room, that means you are talking about less than $30K in savings. Am I correct in saying that? The reason for that is the price point you will be able to buy in will be limited, even if you do the 5% down. 

I would suggest you pay down your debts if you have any. 

Perhaps do a short term private loan to another investor for 3-6 months and get 10% interest. Have you maxed our TFSA?

We are talking about 1 year to go with saving (which by the way is slow - you might want to rethink this 'saving' strategy). Is the money burning a hole in your pocket? 

Good luck

@Chantell Austen Get a 2nd opinion and 3rd opinion. Keep in mind, mortgage brokers do not have access to CIBC and RBC. So you may want to reach out to those agents regardless of finding a new MB. I have a great RBC agent so can refer you. 

Your debt service ratio may be too high as your HELOC may be showing up on your credit score thus part of the TDSR, and your score may be too low. Even though your borrowing amount totals $500K, if your HELOC has $1.5M registered on it, then they use the $1.5M in their calculation. A good agent will be able to give you more info on this.

Another option besides private lend, is looking at B lenders. Their rates will be around 4-6%.

@Jaydon H. networking and fine tuning your process to find JV partners and private lenders. Determine what other streams of income you want from RE. From the current properties you have, what else can you do to improve your cashflow. Also, you can give some of your time to new investors. Improve on a skill that you are currently weak on. Good luck.

@Clark Y. message me and I can refer you to my commercial agent. You might want to get on the mailing list for this CBRE Advantage Magazine and their Monthly Mortgage Commentary. CBRE Canada

Good luck. 

@Elizabeth Gregorio If you are looking to expend into Alberta, You can do so without selling your condos. You can look into VTB and AFS. This will require a low d/p and you don't need to qualify with 'A' lenders. 

If your condos are cashflowing, then I would suggest you revisit your motive for selling. Yes you can sell even if there is a tenant in the unit. Perhaps arranging for a HELOC on the condos may be a better option.

If you are getting several under your belt, you may want to look into putting them under a corp or using Section 85. Good luck.   

@Elizabeth Gregorio Yes, you can sell a property even if you have a tenant in it. If the buyer wants vacant possession then you have to file the proper paper work to evict. Or you can offer cash for keys. 

The other option may be to offer a RTO to the current tenants.

Or if you are able to pull out the equity (either though a refi or HELOC) then your can counter the negative cashflow with another higher return investment.

You mention condoS - how many units are you talking about? If you sell, will you qualify under the new rules to get new mortgages? Talk to a mortgage broker and sort this out before selling. Also sounds like setting some time aside to 'plan' out your strategy would be time well spent so you don't go down the SF path and realize in a few years that doesn't cashflow to your liking either. You might find you have enough to get a MF. Good luck.