All Forum Posts by: Shaka Farrier

 Thanks for the responce. The owner is willing to bend and I believe he also is willing to do owner financing. I was thinking that it may be price a little high but my agent says that it is priced right.  The property has been on the market since the last week in July

Thanks for you insight @Steve Vaughan

 I do have some saved money to put down. I mentioned a downpayment to my agent who advised me that it wouldn't be necessary. I wouldn't see those funds back until year two and I should keep it as a nest egg.

She also suggested that we offer $220,000 because we were already asking for closing costs. We were going to ask the price be lowered or that the ownet paid to seperate the water but it costs a bit more than expected and I don't really want to start putting holes and digging if it isn't completely necessary. 

 Thanks a lot Mr. Randolph. The seller purchased the property in 2002 for $112,500. They are asking $249,000. Like I mentioned earlier, the property is indeed in really good shape. The comps are all over the place though. Some from last year and others are miles away (over 1 mile), the year built also varies. I'm assuming the appraiser has a way to figure it out even with limited comps but how accurate will the appraisal be? Last year's tax assessment was $217,000. I won't lowball him but I have to keep one of the best real estate quotes that I've ever heard in mind

"You don't make your money in real estate when you SELL...you make it when you BUY"

 First and foremost, thank you very much for your reply. Living for free isn't a MUST...$100-$200 a month for a year then moving out to bring in the full rent potential of the property is the ultimate goal.

I have also been thinking about budgeting for owner expenses such as Cap X, vacancy, property management and such. In order to do so in a duplex I would have to put money aside as if I was renting as well. 

Both units are 3 bed - 1 bath and pretty are spacious. I will be the only person in the unit that I occupy so I was also thinking about possibly renting out a room for 500-600 a month. That's a pretty common practice down here

Although I am extremely excited and ready to just into the game, I constantly tell myself not to get emotionally attached to these properties and their potential. 

Hey BP, Ive finally found a small multifamily here in the Hampton Roads area Virginia. It's a small duplex built in 1953 that is in very good shape. I plan utilizing my VA loan and owner occupying for the required year.

My problem is that I'm not sure what to offer. I want my second unit to cover the mortgage. I know that the section 8 max for this type of unit will be $1,200. 

In order to get my payment at $1,200 or lower without putting a l down payment I know I have to get thay purchase price down. We are gping to ask the seller to pay my closing costs. I don't want to make an offer too low that will scare him away.

Asking price: $224,900

Interest Rate: I have a few lenders battling it out but I've gotten quoted as low as 3.5% with no origination fee. At this rate and asking price my payment would be around $1,400 give or take.

Repair Costs:$0 so far. A turnkey propertt as of right now. The inspections may give me some more negotiation leverage

Owner Expenses: The water is the only thing not metered seperately. There are separate water heaters but the cold water isn't seperate between the two units. I thought about splitting the water in half every month but there's got to be a better way. Adding a meter with the city will be too costly.

Sorry, I tried not to make this post too long. Thanks in advance for any input. 

no update?

Im going through the same thing. The HUD property that Im looking at has a bid timer that resets daily.

Thank you all for your replies. I apologize for not including more info. I thought about house hacking and owner occupying for the required year with FHA. This area has great opportunities for landlords with the majority of the population being military (army, navy, air force), colleges and shipyard workers (the second biggest employer in the state).

A 4-2.5 should rent over $1200 easily in this area. My agent mentioned getting a termite and moisture inspection for less than $100 first instead of the home inspection for $300-$400. This will give us some insight on the water damage on the floor at a cheaper price than the full home inspection.

I may be able to get the roof inspected for pretty cheap as well. But I dont think HUD wants contractors in the property before the bid is accepted.

Ive come across a HUD home and took a walkthrough last week with my agent. I like the property a lot. Its a 2.032 sqft 4bed 2.5 bth in a quiet neighborhood right outside of the Air Force Base in my area on corner lot.

Here are my concerns:

1) The dishwasher seems to have leaked and damaged the floor boards. My agent and I have stepped on the damaged areas but the floor boards dont seem to be damaged all the way through. The boards are soggy on the surface. I believe that this can lead to termites and extensive moisture damage in the structure of the property. Im not sure how much this can cost me to repairs.

2) HUD provided a document that vaguely lists the repairs needed for the property. The one that made my agent and I second guess the property was the roof. The document says "Roof Inspection recommended (damage to main support trusses observed)...".

3) The document also states that the HVAC needs to be connected. My guess is that it needs to be replaced. its pretty rusty

These three are the biggest issues that I am concerned about. Everything else in the property seems pretty manageable with a FHA 203k loan (which the property qualifies for).

HUD is asking $157,500 for the property and I know that a 4-2.5 in this area is easily worth $200,000+ ARV. Im just not sure if these repairs are worth the trouble

Thanks for your help Sid. I appreciate you clarifying  your decision making process. I am probably going to owner occy since it just me and owner occupying does not both me much.

I have been comparing the pros and con's on FHA/FHA 203k vs VA Loan (which I am currently eligible for). I am thinking FHA may be a better option because I will be able to acquire the funds for repairs at the same time of purchase. I'm not sure though because I do have 10k-15k in cash saved up right now. Should I keep it in my reserve and use the 203k. MIP is a cash flow killer