All Forum Posts by: John Jabson

We are 3 days away from closing and I get a paper that lists the things that I need to bring to closing. No problem until I see, "This property is in a special flood area" and you need "proof of flood insurance."

The sellers gave the bank and me a copy of a paper that stated that the property was not in a flood plain. I would not have bought the property if this was not there. However, it looks like FEMA changed the maps last year. And....our mortgage officer figured waiting until I called him 3 days prior to closing was the most appropriate way to inform me of this.

Great news! Anyone else ever dealt with a waste of a mortgage officer?

Where do you all put your money when it's not being used in real estate? What's your holding tank?

That makes sense, unless there's a really long waiting period between flips. I don't know if that will be the case.

Currently have two rental properties and a primary. Just learned that local banks will not loan me any more money for rental properties because both rental properties have been rentals for under 2 years. One will be 2 years in February and another will be 2 years in 1.5 years.

I have about 15K sitting in a savings account. I do not want to put it into the stock market because I believe the market is risky and I'd rather have control over my money via real estate. Some of you may disagree but that's my philosophy, right or wrong.

I want to use the 15K, along with borrowing from a private lender, to finance a flip property. Let's assume I make 5-10K on a flip. I can use it for the next flip however there might be some wait time in between.

Should my money sit in a savings account being eaten away by inflation, or should I throw it into a mutual fund? Obviously my purpose is to beat inflation and have enough liquidity to pull it out and use it on the next flip.

Thoughts on this?

Makes no sense that they would take purchase price rather than appraised value. Their risk is based upon the value of the property, not the purchase price.

Is mortgage insurance on primary residences based on the appraised value of the home or the purchase price of the home? I know, for me, it's 80% but I'm not sure what it's based on. What's the norm?

(I will, of course, contact my lender but just wondering what you've ran into.)

A few years ago I took out a HELOC on my primary house to buy a rental property. The rental property ended up not cash flowing very well because the line of credit took up too much of the monthly cost. The rent was 600, the PITI was about 290, but the HELOC ate up 190. So the property only cash flowed 100 dollars or so. In order to solve this problem I refinanced my primary and secondary (Heloc) on the primary. It raised the monthly cost for my primary slightly, but it solved the cash flow problem for the rental. I really believed this was a good move.

I am now buying a 3rd house as a primary. Thankfully we bought it for 75K but it appraised at 93K. I now have about 20K in equity in this property and I'm now considering doing the same thing again, taking out a HELOC to buy another rental. However, I cannot do this same cash flow problem again.

Is it possible to take out the HELOC for 10K, buy a 40K rental property (20% down) and then refinance the primary and secondary like I did before?

Just looking for any thoughts on this. Interest rates are low so if I'm going to do this, I might want to start looking to do this soon.

The problem with the three of us is that one person has 20 years of construction experience, the other has a few (3-5 years) and the last person has only 2-3 years of experience. We would have to figure out how that would function properly together, as a group.

Flipping a home with an investment from 3 guys, 2 of which have extensive background in construction. All 3 people would be active in the rehab.

Anyone ever done it? It would seem to be helpful, especially when everyone has a 9-5 job to take care of.

Sandy,

Do you get out of the area investors wanting to invest in your area, whereby you are the buying agent and then, after closing, become the property manager?