All Forum Posts by: Jibu V.

I’ve been using Cozy for years, but recently started using Innago for one of my new tenants. Innago is essentially $2/mo/unit for ACH payments, which you can absorb or have the tenant pay. While Cozy is free, I am finding Innago to be much more customizable. It also has an app that tenants can use, unlike Cozy. At least in my experience, the year-end reporting that Cozy produced for tax purposes did not always have the most accurate and complete data.

One major plus for Innago is that you can set up and sign electronic leases, including reusable templates, as well one-off documents for electric signature completely free. A stand-alone electronic document signature service would cost way more than $2/mo.

Lastly, Innago customer service has been very helpful and responsive both before and after signing up. With Cozy’s transition to Apartments.com, which seems to be very glitchy, I can’t say the same about it.

In any case, if you haven’t already signed up for Cozy, then you will be directed to Apartments.com.

 Deep down, I thought (was hoping?) you were actually about to explain the magic behind it. I guess this only further confirms the opposing view. 

I do agree it sounds purely psychological. All the explanations I've heard involve paying more toward the mortgage than you normally would, with the HELOC available as the emergency fund vs. savings account. My view is that I could do this anyway without a complex banking strategy.

Although, as a real estate investor, the opportunity cost of tying your capital up into your primary residence is too high, unless you can turn right around and tap into it (e.g. by applying for a HELOC).

Hi Joseph, which bank did you use to obtain the 1st lien HELOC?

@Andrew Postell I read the entire thread - thanks! 

Since the recommendation now is to fund the purchase from the LLC's bank account, what if I'm using a HELOC that's in my personal name?

1. Logistically, would I just draw from the HELOC directly into my LLC's bank account and then immediately be able to use those funds as long as they are available?

2. When the title company puts the rehab funds in escrow on the HUD, I think you mentioned that we could hold the money (not title co). What would we need to tell the title company so that they agree to let us the hold the escrowed funds?

I may be wrong, but it sounds like the $200 is after reserves for repairs & maintenance, vacancy, etc, which is not a bad cash flow number.

I like the map that @Ryan D. posted. Check out Trulia’s crime map. It shows crime levels on a block by block basis and it’s a good starting point. I bet there is some good correlation between the two illustrations. 

Also, check out YouTube videos on how to find out the zip codes where there are a high volume of cash deals using Listsource. 

Call a few realtors off of Zillow and pick their brain on the Philadelphia markets. They can also provide you with cash sale information from the MLS.

Drive through these areas not only during the day but also at night and get a feel for how they are. Then when a potential deal comes your way, you can have a better picture of what that particular area is like. I haven’t been in Philadelphia that long but I can say that there are many areas where you’ll see that a single street will be the divider between a B area and a C area. Or even B vs. D. It doesn’t make sense until you drive through and see the difference for yourself. 

I can relate in that I need some good metrics to analyze a market on a more granular level. 

I got a quote from them but they were no where near the most competitive. I showed them another loan estimate and they technically beat it by $100. As someone who wants to have a long-term relationship with my lender, it seems like I’d have to do a back-and-forth like this with them for all of my loans. It’s not worth it for $100. I ended up getting an even better deal elsewhere but didn’t bother coming back to better.com just so they could potentially beat it again by $100. 

Sounds like we are just talking semantics at this point. I think everyone agrees that you’d pay less interest on the traditional mortgage side if you make additional principal payments.

After reading this whole thread, the only thing I'm still not clear on is if there is actually a compound savings effect relative to the average daily value calculation of interest between the "HELOC" method vs "additional principal payment" method. Or, does that "$5/month savings" really just stay "$5/month" for the subsequent months also?

With a HELOC, you will likely be able to tap into more of the equity as you could go up to 90% LTV (or more) depending on the lender. Most lenders do 80% but some do more. Also, with the HELOC, you'll have almost no closing costs vs. cash out refi. Once you buy the investment property with the HELOC, you could do a cash out refi on that investment property and pay down the HELOC. Then repeat the process on a new deal. Interest will only accrue on the outstanding balance, whereas a cash out refi will be more expensive from both a closing cost and interest expense standpoint.