All Forum Posts by: Shaka Farrier

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 I do have 10k-5k in cash saved up right now. Should I keep it in my reserve and use the banks money or use it for repairs.

Is it just the way the pictures were taken or did you do something to the brick siding in order make the color pop in the after pictures the way it does

I have to admit, I couldn't help but smile when seeing these before and after pictures. It is very inspiring to see the work you have put in and the result you got out. Im sure it was well worth the completion extension toward the back end of the rehab.

I have a couple of questions about your rehab and finance decisions:

As far as the finance portion, Im trying to make sure that I understand why you chose to use hard money for the purchase and rehab. Was it because you needed extra funds to put into the rehab that other financing options would disapprove? If so, was FHA/FHA 203k not an option?

How much did you come out of pocket for your refi? Was a conventional loan not an option when originally purchasing the property because of the amount of work that needed to be done? Would the bank have considered that property an investment and required you to make a bigger down payment (25% or more)?

Sorry I have so many questions. I plan on purchasing a duplex before the end of this year. Im trying to do as much research as possible so that I can get out of the analysis paralysis stage. 

I love BiggerPockets!! I dont know where Id be without it honestly

I am currently deployed (Navy) and have been reading "Success of a Real Estate Agent" and "Real Estate Exam for Dummies" along with BP and Google. I decided to start looking for a successful broker in my area (when I return) who hopefully gives classes to prep me for the state exam. I just read an article yesterday about looking for a company whose stats are high and believes in TRAINING. I am looking for experience more than anything right now. Thanks for the insight

@Jon K. i am all about the "what ifs" which is why i am inquiring about this a year in advance. Having my gf involved is just a thought because i know that she wants to work with children. My original thoughts were to have the child care provider to rent out the house after my year of owner occupancy is up (required by the VA loan or FHA). I would really have to made sense out of how to price rent and the operations of the day care. I was just going to have her start things up because she knows families who are in need of child care. Furthermore, the Hampton Roads area is saturated with military personnel and college students who are always looking for child care. With decent marketing, I don't think finding clients will be the hardest part of this project.

My girlfriend has a few in mind but it will be an afterthought for me Pete.

I was thinking about buying a property under market value and making repairs. I just wasn't sure the lender would allow me to do so. Heres and example:

approved for: $175,000

ARV: $150,000

purchase for: $80,000

repair costs: $20,000

extension for day care: $20,000

my numbers may be a little screwy but just to give you a visual on what type of deal I'm thinking about

@Bill Gulley what you think?

@Bill Gulley I agree, making the improvements after the purchase seems like the best route to take. Thanks again for your input. it is GREATLY appreciated.

@Colleen F. I am going over the state guidelines for zoning now. I was also thinking about an alternative use for the extension for selling purposes. With only a few children, an enormous amount of space isn't necessarily needed.

Ultimately, my goal is to increase the value of the house while brining in income from the home based business (day care). The general contractor I spoke with had a home day care that his wife ran before she became a RE agent. I will try to speak with him about zoning issues after i go over the regulations myself.

@Bill Gulley It is to my understanding that a Virginia home day care can be run without a license while caring for up to five children (depending on age). I will be looking into zoning regulations this week because if changes aren't necessary to run the day care, the only other reason to make them is to increase the value of the home. If neither of those will be effected, there is no point in spending the money.

As far as financing, what about if I purchased the home and decided to make the modifications later down the line? Of course the cost for extensions or additions to the house would be vary on a situational basis but what if I decided to pay cash for those add-ons? Would the VA or FHA still have a problem with my doing so? I plan on saving a significant amount of money while on deployment to have enough cash to invest in RE. The day care in an investment property just seems like a great start to additional income and killing two birds with one stone. I would be needing a place to live when I return which is why I have no problem abiding by the owner occupancy rules of the VA and FHA loans.

(Side note:I will be taking the state administered class to get my head fully wrapped around the can and cannot do's of home day cares in appliance with Virginia state laws. )