All Forum Posts by: Jody Kennedy

Investment Info:

Small multi-family (2-4 units) buy & hold investment.

Purchase price: $155,000
Cash invested: $31,000

Completely renovated 4 family home with 2 car garage which rents out separately. All separate utilities paid by tenants. Solid, long-term tenants, one of which does the property maintenance for slight rent reduction.

What made you interested in investing in this type of deal?

This purchase was my first investment property and had a fantastic cash flow.

How did you find this deal and how did you negotiate it?

Spent months researching for the right area and property where the numbers would work and meet the financial goals I had set.
was working in real estate already so had access to to properties before or as soon as they were listed. It was priced under market value as it was a very motivated seller. Came in with a solid offer of asking price with a 12 hour decision to avoid a bidding war as I knew there was a lot of interest.

How did you finance this deal?

Took money from my 401k for down payment and renovations and used a conventional 30 year loan with 3.25% interest.

How did you add value to the deal?

20% down payment, fast close, inspection for informational purposes only shore of anything structural being reveled.

What was the outcome?

Offer accepted within 6 hours and fast close.

Lessons learned? Challenges?

Knew zero about investment props, property mang, landlord-lording, finding tenants, or rehab. Just dove in, researced my pants off, talked to everyone I could w/useful experience. Worked w/hired contractors to learn, then got my contractors lic. Initially rented based on my "gut" felling, getting me in trouble at times. Now, I manage & rent as strictly a business decision. Rents are auto deducted. I rehab beyond average & charge highest , great screening, better tenants & more $ :)

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Unibank in MA was and continues to be great but I didn't need anything creative.

Hi and Thanks in advance for any insight. If you have an FHA mortgage does it show up as that on your credit report? Owner occupancy is a requirement to tap into equity I have in my first rental property. But I currently have an FHA mortgage on my second. Will the lien holder on my first see the second mortgage as an "FHA" mortgage and therefore question occupancy condition?

Hello, 

I'm looking to purchase a home that's currently a 5,600 SF SFH, it was converted from a 5 family years ago when the daughter inherited it and wasn't interested in being a landlord. She kept the apartments maintained and heated (one one system and service now) but never rented and legally converted it to a SFH with the town. The town never made her tear anything out and only changed the status and assessment to lower her taxes! (back in the 70s when things were oh so much easier.)  So the apartments are still perfectly intact and well preserved, kitchens, entrances and all, even the appliances which work great! It's truly like going back in time and the current town officials were completely unaware of all of this LOL as the old officials are now long gone and nobody was the wiser.  

So after many hours with the town and digging up old field cards in the basement they found the original 5 family card and eventually agreed to grandfather it in and approve a reversion to a 5 fam or less, whatever I would like and obviously after I close. Happy dance as it's being sold at the SF appraisal price!!!   

My only choice at this point is an FHA 203K, which will allow me to update it and convert it back to a four while I live there for the first year. After all is said and done, signed off on and closed, can I create an in-law that collects rent and not have it considered a 5 family (town is fine with it so that's not the question) But as we know a 5th "apartment' pushes me into commercial in ways I'm not interested in, so only want a 4 fam with a legal in-law if possible. Does anyone know if this would fly (with FHA, with insurance, with resale?)

I know this is a gray area and not all agree on what constitutes an in-law :/ 

Thank you in advance for wading through all the details and any light you can shed.  Jody