All Forum Posts by: Jack Plantin

How much did you refinance for? 

This is great, thank you so much!

 Thanks Adrien for the response. I'm glad to hear I can get into this market from the comfort of Chicago. I spoke with a realtor last night (Chuck from quadwalls.com) whose opinions mirrored yours pretty closely. I will continue looking at deals in Griffith/Highland and continue saving for when the right property pops up.

Hello everybody, I am a union construction worker currently renting and living in Chicago. Was originally planning on purchasing and occupying a duplex in the city with a 3.5% FHA loan, but my wife and I were not willing to sacrifice commute and lifestyle (lived in a basement, not willing to do it again) to house-hack, so we ended up signing an apartment lease for another year.

After receiving some inspiration and anecdotes from coworkers recently, I've recently become interested in buying, rehabbing and renting out a SFR in NW Indiana or SW suburbs around Joliet, IL.

Our financial situation is pretty solid. 6k combined monthly income and 2.5k monthly expenses. Wife has a 700 credit score and I have a 650 credit score with no debts besides an auto loan that is being paid off with Turo. I have around 18k cash saved up, with another 4-5k in stocks that I'm willing to cash out if necessary. I have a couple potential partners willing to help finance a good deal if there is profit to be made. We would be looking at properties around 80-120k to minimize financial risk if the property remains vacant for longer than we expect.

I have a couple questions for now:

1. How is the rental market in NW Indiana or SW suburbs?

2. Am I likely to find any good deals just on Trulia, Zillow, MLS, etc. or should I look for foreclosures/short sales/under-contract to make the numbers work?

3. What kind of partnership is standard when taking outside investors money for BRRRR? 50/50 on rental profits or a 10-12% hard-money loan?

Regards,

Jack

 Sorry it doesn't come into play. He is just offering this as an alternative so:

1. I don't have to pay market price/PMI and can cash flow quicker.

2. He can have a guaranteed buyer.

3. To bypass "strict" (his words) FHA requirements.

I'm still unsure if he wants to do owner financing or bank financing. Probably the former would be more beneficial for him.

I'm in the process of searching for properties to house-hack with a low down payment (FHA). An investor acquaintance of mine introduced this idea to me today:

1. He buys a foreclosed property and finances rehab with cash

2. I buy it off market for 10k under appraised value with owner financing, because I'm a guaranteed buyer. (I think this is what he said).

3. I find tenants and house-hack it.

There are probably some steps/details I missed, but hope you guys get the jist.

Pros/cons?

Is he trying to take advantage of me or is there really value to be had on both sides?

 I understand. I think it would be best to do a traditional loan so she would get the lump sum right? It was built in 1963 and EMV is 167k. Up from 152k last year and 146k before that. Do I get a home inspector/appraiser to come check it out before I offer to buy a property? Sorry if it's a basic question.

 Noted, thank you.

We currently live in Chicago and are saving up money until Spring. We don't plan on living in the house, but instead updating it and renting it out after a few months. We are considering relocating back to MN and living more frugally in order to put 100% into updating the house, gaining equity for additional financing on our next deal.

*Edit* But we would consider living in it and renovating (maybe this makes more sense) if we could take advantage of 1st time programs. Aren't there some which also give access to home rehab loans?

My grandmother is putting her home on the market, very desirable neighborhood and a rapidly growing & family friendly city within 1 hour of Minneapolis (Rochester, MN). I've been reading about BRRRR and am thinking that her property might be a perfect place to start, due to many young families looking to rent SFHs in this city.

Some details on the home:

- It hasn't been renovated since the 1970's, but it is relatively good shape.

- It's located next to a great middle school and within 15 minutes of a major hospital where many residents of this city work. 

- Comparable homes go for around 200k (rough rough estimate).

My wife and I have 20k saved up, have very good credit scores and would be first-time home buyers. Our questions are: 

1. What kind of strategies could we take advantage of to buy her home, while utilizing our savings mostly for renovations? I have heard of "under-contract" in this podcast, but don't quite understand how it gives you an advantage compared to conventional loans.

2. Would we be approved for a conventional loan, FHA, or other first-time buyer programs if the house is relatively old and requires updates?

3. Is there anyway to ensure my Grandma and we both get a good value in this deal?

I'm sure I have way more questions, but I think this is a good start. I'm in contact with a great realtor/investor in the area that can potentially help us find similar properties if GMA's doesn't pan out.

Thanks in advance for any input!