All Forum Posts by: Isaac Passmore

@Mike Shahi

That's the 20% needed for the down payment. Multiply those numbers by 5 to get the actual asking price.

Is there any penalty for paying down a mortgage early? I'm trying to get started in DC and the down payments needed for a conventional loan is 20% however, for a standard duplex that's in the 140k-300k range. I'm not suggesting that any of those are good deals but that appears to be 20% of the asking price. 

Since this is my first deal I would like to have 30% of my cash reserves after closing since I don't know what to expect. In order to make this happen, I likely won't be able to reach that 20% down mark. This means I'll likely be subjected to PMI costs. (I don't know if I feel comfortable asking for outside money since I don't really know what I am doing yet and I'd feel absolutely awful if I couldn't come through for them)

My questions are, if I go the PMI route, is there any penalty for paying down a mortgage early? My thinking is pay extra each month in order to get out of that PMI condition sooner to help the property cash flow a bit better?

An additional motivation for doing this is that I plan on house hacking this first one. My plan is to find a place where the rent I'd be expected to get for that space would become my new rent. This new rent should be less than my current rent. My plan would be to continue paying my current rent towards the new mortgage while I live there until PMI is eliminated.

I know this answer will be different for each deal, but in general if a property already cash flows with PMI at the expected rental rates then getting rid of that PMI should be a priority to help increase cash flow sooner and allow me to pay less each month since there will be little motivation to pay extra.

How advisable is this to get started in DC?

@Jacques Herve how large of a difference between luxary condo and renting with roommates do you use when crunching the numbers?

Hi @Mark Cruse, can you expand on that? If I can get a brand new 3 bedroom townhouse near a metrostation for $300k-400k and rent out each room for $1000-$1200 a month when luxary 1bedrooms in the area go for$1400-1600, what am I missing?

Hi all, first time posting on BP. My girlfriend and I are really interested in trying our hand at real estate but we aren't sure where to start in terms of location. We know we want to get inside the District of Columbia but it's crazy expensive in nearly every neighborhood. We've lived in the district for a number of years and have also spent sometime in the neighboring Prince George's county. Both locations have their perks, but looking long term we feel DC can better fill vacancies. This would be our first home purchase and we'd like to leverage house hacking. We'd prefer to have a separate dwelling area but those tend to be few and far between. We're also willing to live with roommates so standard single family homes are also an option for us. Because this is our first deal we want to try to avoid a lot of potential capital expense on repairs or rehabs. We'd like to put no more than 60K down which will likely mean that we need to make use of an FHA loan.

We wanted to get people's opinions on how to go about getting off the ground. Would it be more advisable to look for deals inside DC where there asking prices are typically 500k+ on relatively small apartments or to look into PG county and purchase a newly built home that's metro accessible and costs 300-400k?

Basically, I haven't seen many people talk about buying newly built homes and renting them out in the DMV area and was wondering what people think of these buildings as potential first time break-even type real estate investments?