All Forum Posts by: Joel Fischer

I found a home I am interested in purchasing. The seller is offering seller financing with 5% down and a 30 year term. The seller said they would eventually like the interest rate to rise to 5%, but didn't specify what they thought the interest rate should start at or when the interest rate would rise to 5%. I am looking in a hot market, so I suppose I don't have a lot of room to negotiate, but would appreciate any advice....

I am also interested to know what this means in terms my owner occupied status. I bought a home as owner occupied in August. How does seller finance affect my conventional or FHA financing options in the future?

Hello Bigger Pockets Community,

My name is Joel Fischer. I am from Portland Oregon. I work for a business association doing government relations. I am a bit of a part time entrepreneur and newly minted real estate investor. I also find work part time, although much less so now, as a photographer.

My goal in real estate is to build enough passive income to allow me to quit my job and focus on other pursuits, such as: traveling, living abroad, photography, investing in other businesses (which I will discuss at the end), and continuing to invest in real estate, of course. I am most interested in investing in multi family properties and I hope to soon be investing in small, or even large or medium sized apartment complexes. Eventually I would like to own my own single family residence within the urban core of Portland, but there is a premium for a purchase like that. I have also tossed around the idea of starting our own property management company with another real estate investor friend of mine.

I purchased my first home December of 2013. It is a multi-family duplex. I purchased it as an owner occupied residence with 3.5% down. I lived in it for a year then I began renting it out as a vacation rental on Airbnb. I automated my system and made a good return, especially during the summer. I continued to save a big portion of my salary and all of the profits from my vacation rental to use as a down payment on my second property.

I attempted to purchase my second multi family property as an owner occupied residence with 3.5% down, but unless I refinanced out of my FHA loan on my first property, I needed to come up with 15% down for property #2. I could not refi the first property at the time because after getting an appraisal, my loan to value was not where the bank needed it to be.

I had to get creative, and I somehow pulled it off without reading a single real estate book or looking at biggerpockets.com! Although I did get bailed out by my loving aunt, Marcia Maynard, who is very active with Bigger Pockets (check out podcast #83). Property #2, long story short, the bank wanted $40k down and wanted to reserves of another $20k, for a total of $60k in my bank account. I only had $20. I took out a $20k loan from my mother on a 3 year repayment plan and borrowed $20k from my aunt and uncle which was paid back the day after the loan closed.

My second purchase was two dilapidated homes on a single tax lot. I put a lot of sweat equity into fixing them up and now have long term renters and I have excellent cash flow from this property.

I have finally started reading more real estate books, The Millionaire Real Estate Investor and The Book on Rental Property Investing by Brandon Turner (hopefully Brandon has a keyword alert for his name set up and he sees this!)

I am in the planning phase for purchasing property number 3, I am considering doing a cash out refi on my first property (still paying $200 a month PMI), and I have lots of questions that I am eager to post to the Bigger Pockets forums.

I am involved in two other small business ventures. The first is a men’s furnishings company that specializes in bow ties and ties, it is called Bowyer and Fletcher and is based in Portland Oregon. The second investment is a two-fer, a cocoa farm and a pig farm in Ghana, a small and productive country in West Africa. I am also on the board of a small nonprofit that builds schools in Ghana.

Thanks all for reading!

-Joel Fishcer

I already own 2 duplexes. I bought my first one as an owner occupied residence with 3.5% down and I am paying $200 a month in mortgage insurance. I bought my second duplex as an owner occupied residence and put down 15% (since I already owned a multi-family property, I couldn't do 3.5% down).

I am in the process of refinancing my first duplex to get out of PMI and take out some cash. My mortgage broker estimates I can take out somewhere between $20,000 and $40,000 on this refi. I have about $20,000 cash of my own to add, hopefully bringing the total I have to invest up to $60,000. I am looking at properties in the $250,000-$450,000 range.

I am not sure what the best next investment is... Should I use all of the cash I have to buy one multi-family property? Or should I use just a part of the cash I have ($12-15,000) to buy one single family home this year (owner occupied 3.5% down) then have cash left over to buy another SFR or maybe a multi-family property next year. I hope to keep using owner occupied financing, but unsure which is the best strategy since banks require me to put down 15% on a multi-family property compared to 3.5% on a single family residence.

Interested in opinions on this, or other ideas....