All Forum Posts by: John Knisely

@Brandon Ribeiro good on you for looking at this option in the first place.

Personally, if finances are tight that you don't have the cash to put 3.5% down plus closing costs, my opinion is you are not yet ready to purchase. This may be an unpopular opinion on a real estate forum (especially given that two other agents posted before me), but you always want to have cash reserves for life's surprises. Negotiate from a position of financial strength!

Now, different story if you are saying your dedicated real estate purchase funds can't swing 3.5%+closing costs without dipping into your emergency fund. That's where Seller's assist can help as Bill and Jim have mentioned. Essentially the seller agrees that $X will come out of their check at closing and go to cover your closing costs at closing (debit Seller, credit buyer). As far as inflating the price and asking for an equal amount of seller's assist in return, keep in mind the house has to appraise for the inflated purchase price. Anecdotally I have had lenders tell me outright that FHA lending guidelines frown upon this practice more than a conventional loan.

A lot of lenders do have 3-5% down conventional loan programs too, so definitely weigh the options and the costs...as well as the potential future tax implications of the decision.

Ask your agent and your lender to run a closing cost estimate for the different scenarios before you offer. If you need any help feel free to shoot me a message.

@Garrett Sowle great timing haha! Great minds think alike.

@Mark McNaughton definitely talk with a few agents in person or on the phone if in person is not possible. I would definitely look for an agent who also does invest in property as well, usually they'll call themselves "investor friendly" agents. There are a ton milling about on Biggerpockets. Do your due diligence and research them, talk to clients they work with and also remember it is important that your personalities align. It's a relationship you want to be open, honest and enjoyable I'm addition to getting the best possible properties for your portfolio. In person networking events are great to connect with investors who can also recommend agents. Word of mouth referrals are powerful and can be extremely successful compared to everyone just doing independent research to find professionals.

Hey Brandon, I'm up for it. Shoot me a message and we schedule time to get together.

@Daniel Golub curious about the lawyer part for closing. Not typically needed in PA but perhaps you have a specific reason?

26,000 square feet is a typo right Igor?!

@Caleb Heimsoth that specific situation, of course. The point I'm getting at is, if the numbers still work, then does it matter that the tenants aren't directly paying utilities?

In my area, the multifamily inventory is old (mostly converted single family housing) and prohibitively expensive to re-meter in most cases unless you are doing a full rehab already.

Originally posted by @Caleb Heimsoth:

@Joe Davis

My tenants pay all utilities, in my single family. I’d never buy a multifamily where this wasn’t the case too

 So if I offered you a 4 unit property worth 500k for 100k but the utilities weren't split, you wouldn't buy it?

@Stephanie Crespo I agree with @Gregory H., steer clear of this path. You'd have better luck getting enough credit limits in your personal name (assuming you have good credit and income) to do this but its not advised. Exhaust any and all options before going to credit card advances including but not limited to:

1. Residential mortgage

2. Commerical bank loan

3. Private money/SDIRA loan

4. 401k/IRA loan from personal funds

5. Hard money

6. Rob a bank and pay them back when you refinance

Then i'd probably put credit card advances as #7 in the list. For a seasoned investor with proven systems its less of a risk, but for someone going to their 2nd deal it doesn't sound advisable. Partner with someone who has the capital if you can find someone interested.

For sale 605 AND 609 8th Ave Prospect Park PA, two move-in ready (turnkey), full rented (under market value rents) triplexes for a total of 6 income producing units. Offered at 335k a piece or 650k package. Great househack opportunity for a first time investor in Delaware county not looking to do any renovation work. Current owners are renting to family and rents are below market value. This property could easily achieve the 1% rule when rents are raised to market value! (2 bedroom unit rent comps in the $1200-$1300 range, 1 bedroom unit rent comps in the $950-$1050 range). 

Estimated mortgage payment (PITI) in the $2500-$2600 range for a 3.5% down FHA loan (Note: This is an estimate). Live in the 1 bedroom unit and rent the two bedroom units for the cost of building utilities, capex, R&M and vacancy.

Easy access to the Wilmington Newark regional rail line into Center City Philadelphia and Wilmington DE. Also great proximity to Philadelphia International Airport, Boeing and other major employers.

Message me for more information.

605 8th Ave, Prospect Park, PA 19076
609 8th Ave, Prospect Park, PA 19076