All Forum Posts by: Jeff S.

Okay Michael,

That is what I'm suspecting.  I'm not all that uppitty myself - I've spilt many a quart in my day.  And I think here in Colorado there's a certain Western mentality of independence that chafes at "rules n' s*#t".  I'm just trying to balance this with a lot of the advice here on BP about tenant screening, strict accountability, etc.  Like, do you evict for a car up on blocks?  A little too much noise on a Friday? A butt-load of junk on the balcony?

I guess there's a certain "fourplex bargain" that comes into play.  Anybody else have insights on this to share? 

No family, so that's not an issue.

I'm just trying to understand the mentality.  Fourplexes around here are (almost always) just drab boxes without parking or decent paving or updated interiors.  If I had $7-800/mo to spend on a rental, why not rent in an apartment complex or a condo?

Or, if I'm a fourplex owner, is it worth the extra effort to update the kitchen a little, take better care of the landscaping, etc. or is that just going to drive away the "typical" fourplex renter? 

My current REI goal is to buy and owner-occupy a fourplex. I totally get the numbers. But I still feel confused about the rental market.

My big question: 

WHO would choose to live in a fourplex? Who ARE those guys?  ( BTW, Name that film....)

In my market (Colorado Springs) it seems like anyone who could qualify for a fourplex unit could equally well just rent a unit in a big apartment complex.  In a complex, they would get ammenities like a pool, clubhouse, covered parking, and so on. No way I (or any plex owner) could compete.

The fourplexes I've looked at tend to have a rough feel to them : driveways/parking areas have deteriorated (or no) paving. Interiors are really dated. And yet vacancy rates are low.

So what is the appeal?   

In some areas, I've seen people parking their truck (always a truck) on the grass. I've seen garbage (mattresses, furniture, etc) piled up around the dumpster.  No apartment manager would allow that.

So I'm starting to wonder if there is a trade-off:  "I'll live in a fourplex (instead of an apartment complex) as long as I can be more relaxed about junk, behavior, tenant screening, etc."

Or am I missing something ? As a fourplex owner, what is the compelling advantage I could offer to a potential renter? 

I'm learning so much here on BP.  First the hoarder house. Then the murder house.  What's next?

Seriously, though, it's not a matter of how much the murder bothers you, its how much it bothers your future renters/buyers. For some of them it is an absolute deal killer (NPI).  So you definitely need to factor in some discount.  Beyond the cost of a deep cleaning. (Sorry, I couldn't help it).

Okay, I'll toss the piggyback loan idea.  But, against all common sense arguments, I'm keeping the cats.

Thanks guys.

 I take it you're not a cat owner.  I've got socks that would make an Enron investor cry.

It's funny.  I live in Old Colorado City, and there's definitely some very sketchy aspects to the area.  VERY broad demographic mix - from homeless, meth-addicted prostitutes on up. At first I had some doubts, but I really LOVE it here. 

OTOH, one of the first MFH's I checked out on google street view (Loomis Ave, by Ft. Carson) had a burnt-out house next door and 2 active cop cars on the block.  Not going there....

Okay, thanks @Charlie Fitzgerald.

Sadly, outside of real estate, I'm not sure I *am* making more than 0.8% on any of my money. :-{

But your point is well taken.

Thanks, @Ryan Gillette

And +1 for my lender who (yet again!) seems to be giving me correct answers.

When people talk about an 80/10/10 loan as if it really existed, what are they talking about ?  Is it strictly a portfolio loan product ?

My goal right now is to purchase and move into a fourplex. I had been thinking about going FHA, but that PMI just stinks!

I was reading about a piggy back or 80/10/10 mortgage, and I kind of wanted to get a reality check on that. My credit is 740+, and 10% down is inside my comfort range. One thing I like about the 80/10/10 : I could aggressively pay down the 10% loan in a short period of time and be left with a long-term, low interest, no-PMI loan on the remainder.

My big question : Is the 80% first on a piggy back the kind of thing a typical conventional loan originator would be willing to do ?  In my last go-round with a lender, she said that NONE of the down payment could be in the form of a loan.  In my mind, that translates into : "No, a piggy back loan is not a possibility." At least not from her.

Are the rules different if you start out by asking for a an 80/10/10 loan ?  Is this something that some lenders do while others do not ?

Also, does the number of units matter ? I recall that my lender said she could do 95% LTV on an OOC SFH (1 unit), but for the duplex I was trying to purchase (2 units) she could only do 85% LTV.

Thanks, BPers!