All Forum Posts by: Jeremy England

I figure if I can get 9 more like the one I have, i'll be set.  10 properties, totally doable goal

You'll need a 4pt inspection for insurability and wind mitigation inspection to get the best rates.  That's across the board.  If the roof is older than 15 years, then inspectors are going to say it needs to be redone.  Doesn't matter if its built with 30 year shingles.  

My advice is free so take it for what it is worth but ensure you have a good exit strategy in place before you buy. That HML is going to come due and most if not all conventional banks are going to want that seasoning period done before they will refi you out of the HML. But not only that, if you don't meet those income and credit requirements, they still won't refi you out.

Were I you?  I would focus on building my cash position, and perhaps working for another investor part time.  

If someone tells me they are buying AND rehabbing a property for 25k, I'm skeptical.  Be sure you are being realistic in your rehab costs.  

But if the deal is as you say then the only downside I see is the variable rate.  If interest rates keep rising you could end up with a more expensive loan.  But that would be an acceptable risk for me if I were given the same terms as you. 

yes. After 6 mo ill refinonce and pull 75k out. This will only leave about 2-4k in it for me and ill be cashflowing over 300

 This is all true its just not as easy as its spoke of on this forum.  Plus i hear of people scaling very quickly on the podcast and forums.

Im not sour on the idea. Its just not what people assume its going to be.  More like buy rehab rent wait.......refinance. 

Ill be doing it again, but people should temper their expectations

What im talking about with the two refis is if you buy, you have closing costs, if you get delayed financing (which is limited to your purchase price) you have closing costs, and if you refi again to get to the 75pct ltv, you have closing costa

Take this latest project. I bought at 62k

I spent 17-18k getting it rented

I can only refi immediately for 62k at 6pct, and a closing fee of like 1000 dollars. So my costs would be about 2200 to close

I would leave 18k of my own money in the project

Scaling, this isnt sustainable without alot of cash to float it. 10 properties = 180000 of my own money in it.  

To access that cash id need to refinance again. Increasing the costs and only after 6 months of renting

That's great news. How long are you holding these properties before you are refinancing out of the HML? And have you had any trouble from the banks after the first 4?

 Let me  rephrase.  I dont keep the security deposit.  What Ido is charge a fee equal to the value of one months rent.  In my case it's 1000 dollars.  Their security deposit is also 1000 dollars.  My state allows me to charge up to the value of 2 months rent.  Tomato, Tomahto

Sometimes you can.  Hell I had this property 100 pct turned around in 1 month.  I but the past month was spent messing around with flaky prospective tenants.  I had one family that committed, paid an ap fee etc, was approved, then couldn't come up with the money

Another committed, paid the ap fee and background, then went dark on me, finally he said he bought a house

Another committed, paid the ap fee, paid a deposit, then backed out because they didn't want to commit for a year

Finally got someone who was johhny on the spot about everything and she lives there now paying rent.  But constrution wise, I was done in like 4 weeks.  But I stil have to wait the 6 months to refi.  In this case I probably could have flipped this property, but it also depends on your market

I would have ended up walking away with like 12k after selling costs if I'd a flipped it.  But I'm committed to buy and hold.  I want mailbox money

Do right by them and it'll probably come back to you.  but for future reference, I spelled out early termination terms to my tenants before hand.  With 60 days notice they pay a penalty of 1 months rent.  Basically I keep their security deposit is how it works.  But I hear ya, I suppose if i had a good tenant that always did right by me I may let them go if it doesn't cost me money