All Forum Posts by: Jacob Trogan

@Alex Prescott You can get a HML on your first flip but like others said the terms will be less favorable. I would like at private money instead, or buy a property and then rather than borrow against no collateral at a high interest rate borrow against your own property with an Open Line of Credit plus 0% APR credit cards to fund a deal with maybe the help of a HML. It will make things less risky for yourself starting out as you gain experience pile on the risk because you know how to avoid costly mistakes. Get out of the comfort zone yes but maybe in a responsible way, either way you are in the right frame of mind.

@Austin Charlton I would take advantage of leverage, how much cash flow will you get on a 100k house? Even if you made 10% return which is 900 a month in cashflow after every other expense which is unrealistic you are only getting a few percent better than the average return in the S&P the magic of RE is in leverage.

@Mark Vesu I see your thread got highjacked a bit, I have a recommendation for a broker for you if you cannot do a conventional loan but I am actually working on a cash out refi for that same loan size in San Jose right now on someone's primary home if you don't have problems with DTI like many investors and can do a conventional loan, reach out to me and I can give you some numbers or pass on the broker

@Joseph Tamara Hey Joseph I am 22 and closed on a house this year I am currently renovating, cool to see young guys looking to get started, if you want to see what kind of house you can buy right now reach out to me and I can see if you qualify, if not there are lots of other options besides traditional financing, that I or others can tell you about lots of great people to connect with on here

@Thomas Don also I agree that banks will start lending on this more freely in the future it is very difficult to use this income right now for a conventional loan product and it is a problem

@Troy Forney Here is an interesting perspective I heard from a co-worker who is a lender who has much more experience than me and has seen a few cycles. It is related to interest rates, the biggest factor I see for any decline in RE valuations nationwide would be a huge spike in interest rates. So that is why I address this. I have a fear that rates may increase significantly in the coming years but he reasoned to me that the fed at this point in time will never let that happen again because it would price the population out of housing very quickly monthly payment wise and basically RE prices would have to tank to compensate for a high increase in interest rates which would create additional problems that he explained more in depth the fed would not allow. Basically the fed is in a rock and a hard place interest rate wise. What I would be more concerned with is the value of the dollar rather than the “costliness” of the real estate.

That addresses the only factor that I think will even cause prices to fall which I think the rate of the increases will just significantly slow down, even with increased rates. Which will probably top out at 6% at the very very max which I would be surprised if they went that high. Every other factor like population growth, current development, and rent increases suggests to me price increases.

Look at it this way. Real Estate is not even more expensive a dollar just buys less. If the buying power of the dollar didn’t significantly decline these higher prices would be a concern but to me it is just logical now to buy a real property that provides shelter in exchange for more of my worthless paper, not a problem at all. Now everything else including wages just needs to increase (I am not suggesting a higher minimum wage but it is a problem).

Also speaking to individuals as a lender the “starter home” now seems to be around 300k. Which is ridiculous to me, most people won’t even accept a home worth less than this, another concern I have is that starter homes seem to be a thing of the past and a home is no longer even worth being bought from anyone besides landlords for under 300k.

TLDR - Basically rates increasing is the only factor that I see causing a decline in prices and the fed would be foolish to let these rise too much with how much debt they are in, the dollar was useless paper and now just more useless so it takes more of it to buy a useful house, and starter homes seem to be out of mind for most of the population.

@Ramon Vazquez got any good recommendations years after this?

@Edo Yichie thanks for this thread, I would be interested in that excel

You are 20 and doing great man, go head first into the commission only and you will find a way to make it work, I always used the excuse of qualifying for a loan to stay with a salaried job, there are lots of loan programs and people who can qualify you to buy property without the w2/salary, do what scares you more now is the time, I’m 22 reach out to me if you have interest in lending vs just being an agent it’s another good avenue

@Kerry Baird have you seen many HELOC products on homes other than a primary? That's pretty interesting if so