All Forum Posts by: John Morgan

@Michael Nguyen

I'm a single family investor with 29 SFR. They're easier to manage. Easy to get financing. Appreciate better than MF. Zero tenant drama vs MF. Cash flow better. Much easier to sell if necessary. Tenants stay for many years vs vacancies every 17 months on average with MF. And easier to fill a vacancy when they come up.

Quote from @Jeremiah Dunakin:

Quote from @John Morgan:

I've bought 5 houses by using 401k loans as down-payments. I've bought some houses with 0% interest for a year credit cards and a few with consumer lines of credit from banks. I use all the rental cash flow to pay these loans off asap, then repeat. I've also used a HELOC to buy a couple houses. And don't forget about tapping into equity if you have any. I bought 14 houses basically for free by harvesting the equity in my houses by doing 5 cash out refis. I use that cash to scale up and buy more cash flowing houses with zero $ out of pocket. That's how I've grown my portfolio of SFR without using hardly any of my own money.

 John I’m so glad to see others pursue this way. I have one single family rental now. I used 401k loan to get money for down payment and repairs. It is the best money I’ve ever spent. I can take two loans out and I am looking to do it again as my first loan is about paid for. I am paying original loan off two years early. Even if I do exact same thing I will have two houses instead of one to pay loan back. Again very nice to see others pursue this avenue 

Yeah, it’s worked out well for me. Several people told me I shouldn’t do this, but it’s one effective way that helped me scale up to 29 SFR in 9 years. I pay my loans off aggressively with the rental cash flow then keep repeating. For me it’s been the fastest way to scale up along with my cash out refis to harvest the equity. 

I've bought 5 houses by using 401k loans as down-payments. I've bought some houses with 0% interest for a year credit cards and a few with consumer lines of credit from banks. I use all the rental cash flow to pay these loans off asap, then repeat. I've also used a HELOC to buy a couple houses. And don't forget about tapping into equity if you have any. I bought 14 houses basically for free by harvesting the equity in my houses by doing 5 cash out refis. I use that cash to scale up and buy more cash flowing houses with zero $ out of pocket. That's how I've grown my portfolio of SFR without using hardly any of my own money.

I bought 2 rentals a year for the first 7 years. I found ways to borrow the cash and did 5 cash out refis within 7 years to recycle the equity to scale up. These cash outs got me 14 houses with no out of pocket $. Felt like I was getting houses for free. I've bought 5 houses from 401k loans too. And a few from 0% interest for a year credit card loans too. And got a couple houses from random lines of credit from banks. It wasn't pretty, but that's how I scaled up buying and holding 29 SFR without using my savings to acquire these houses. And I used all my rental mailbox money over the last 9 years since I first started investing to buy more and more. Grind it out for 5-10 years like this and you'll be set for life. Good luck!

I’ve got a several of these. The losses just pass into future years that will eventually offset future gains.

I self manage 29 SFR and do all my taxes on turbo tax. It's definitely not rocket science to do. lol

@Keno Powers

Been there, done that. I got maybe $150 out of my tenant I had to kick out because she couldn’t afford rent there. She paid me like $50 every other month after constantly reminding her. I finally told her to forget it and relieved her from the 3k she owed me in damages and late rent. It’s not worth chasing people around for a buck in my opinion. Move on and try to screen better next time.

@Nick Cooper

I’ve bought 17 or 18 rental houses with 20% down. I’ve bought a few with 25-30% down as well. But those didn’t cash flow as good so I threw more $ down or my lender gave me a much better interest rate with a bigger down payment.

@Ben Cochran

My first two investments 8 years ago were paid off. I did everything I could to get them paid off and was proud of myself at the time. I was also a Dave Ramsey guy at the time and thought debt was bad. Lol. Then I read Rich Dad, poor dad which completely changed my mindset. I learned that good debt will make me wealthy MUCH faster. And the power of leverage will bring me generational wealth in about 10 years. So I took my two paid off rentals and harvested the equity to scale up and increase my cash flow. Since then I've bought 14 houses from doing 4 cash out refis. I basically got these homes for free without using any out of pocket cash to scale up. I've used all the rental cashflow since I started investing to buy more and more houses, or to pay off 401k loans and 0% interest for a year credit card loans to scale up. I'm a fan of using that equity built up just sitting there doing nothing. My cash flow with those two paid off properties was only around $1500/month combined. Now it's 19k/month and I haven't used much of my own money out of pocket to scale up since I learned to leverage and tap into equity to scale up. I owe 2 million with all these mortgages, but the properties are worth 5.1 million and rising. And my tenants are paying off my mortgages while paying me good monthly cashflow. I currently have 29 SFR now and glad I decided to use the equity sitting there doing nothing for me 7 or 8 years ago vs having only two paid off homes cash flowing me much less.

I've got a few houses I rent by the room. I've only done an appraisal on one of them which I added two bedrooms to. The appraiser didn't count them as bedrooms. lol. But my DSCR lender and commercial lender used the individual rent for each room since the appraisers market rent wasn't very high.