All Forum Posts by: Jonathan Polacek

Thanks so much! My good friend had a unique and very uncool thing happen by a property manager he hired for his first rental/investment. We appreciate the help!

Does anyone know a great property manager in Iowa City? Thank you!

@Theresa Harris Thanks so much for responding. I'll definitely take my time and a close look at these details when choosing a loan and I've been convinced that the 30 YR is the way to go. 

 Honestly, I can't tell you all enough how excited I am to have found this group of wonderful people! I was recently talking to a friend of mine about this stuff and I watched her eyes glaze over and become a couple of doughnut wholes in her head. Hahaha i'll save my questions and comments for BiggerPockets!

Take care All,

JP

@David M. Absolutely. Will Do. Thank you, again! I really appreciate your time and information. Have a wonderful day and take care. 

@Red Smith Thank you for your reply and offer to help! I can reach out to you for excel help when I have a specific property in mind. I certainly plan to start my own excel work, as well. I definitely understand your point; paying off a 30 yr quicker, if I'd like, while giving myself time to fall back on. Otherwise, using that money for other investments that have a higher return than my mortgage interest rate. Thank you, @Mike McCarthy, for that input. It makes total sense.

Again, I'm new to this and am, simply, trying to be active on the threads and hope to spark conversation and learn more. Other than that, I simply wanted to offer a tip I learned for paying down a loan quicker to anyone who may be interested in that for one reason or another. 

 @David M. I realize I wasn't clear on what my question is, I apologize. In fact, you answered it by noting that the math doesn't work out that way due to amortization. I wanted to make sure that I wasn't offering false information to anyone who wouldn't know better. Thank you for your help and advice! I got myself a table.

Thank you, @Richie Thomas. I'm with you on paying off the PMI if i'm unable to put 20% down. But now I'm trying to figure out if I shouldn't go with a conventional loan so I can split my total downpayment money available (30k) between multiple properties right out of the gate. My low income should make me eligible for an FHA. However, I have great credit and no debt. There are so many ways to acquire property which excites me because I know that I've started on a lifelong learning adventure in the world of real estate. Thank you, again, all and take care!

Hello All!

I'm preparing to buy my first house. I will buy as a primary residence with either a 15 or 30 YR conventional loan and plan to rent it after two years of enjoying it and making it "tenant proof". After reading some of Brandon Turner's books, I plan to use the tips i've learned.  

I'm hoping this post can help other newbs, like myself, AFTER I've received confirmation from the pros that my math is correct and I'm implementing the learned tips correctly. This tip relates to paying off your loan quicker.

For example, I'll say that I can COMFORTABLY afford a $2,000 mortgage payment each month. I don't want to choose a home that gives me this initially because I want to pay it off quicker. So instead...

I choose a 15 YR conventional loan on a home that brings me a $1,500 mortgage payment each month. How can I pay it off in 10 YRs?

That would be a 33% decrease in time, adding 33% to my payment. Rather than simply adding 33% to my $1,500 payment (= $1,995) and making 12 payments each year, I can lower my monthly payment by paying bi-monthly (half my monthly payment every two weeks). This will give me 13 full, monthly payments, which will lower my monthly payment by dividing the yearly total by 13, rather than 12.

52 weeks in a year = 26 half payments = 13 full payments.

Here's the math:

1,500 X 12 = 18,000 (original yearly total); 18,000 X .33 = 5,940 --> $23,940 per year to pay off in 10 YRs.

 23,940 ÷ 13 = 1,841.54 --> 1,841.54 ÷ 2 = $920.77 bi-monthly payment  

I'll check my math...

920.77 X 26 = 23,940.02 *overage due to rounding.

Want to pay it off even faster? Another tip I got from Mr. Turner's books - get an extra payment in each year by dividing your monthly payment by total number of payments in a year and adding that amount to each payment. It should look like this.

1841.54 ÷ 26 = $70.83 --> 920.77 + 70.83 = $991.60 <-- This is my new bi-monthly payment and I am still under the $2000 per month mortgage payment that I know I can comfortably afford. How wonderful!

Anything i'm missing, pros? Any discrepancies? This is a simple and an incredible way to save THOUSANDS over the life of the loan. It blew my mind when I did the math to figure how much I'd save versus paying the given monthly mortgage over the full life of the loan.

Is this helpful? I am new to Bigger Pockets and want to be active. I am lacking in experience (not for long!), but I'm pretty good with numbers, so this is where my mind went. Thank you all for your helpful posts! I've really enjoyed the ones i've read.

Random info: I just learned that bi-monthly and bi-weekly can mean the same thing due to the pre-fix "bi" being able to mean EITHER "occurring twice in" OR "occurring every two". That's silly.:)

Ryan, thank you for your reply and offer to help. I really do appreciate it. I got pre-qualified, suddenly, in case this single property in Brevard turned out to be a smart choice, but it wasn't. I'm tied to a rental lease until April so I'll stick to the plan and begin making offers after the new year. I'm excited to talk to multiple, like-minded agents to work with for our first purchase and would love to stay in touch. 

I mentioned eXp because I will be licensed myself soon and I heard good things and am hoping to talk to someone affiliated in that regard.

Thanks again and take care.

-JP

Hello all! I'm hoping to connect with a real estate agent / team with eXp Realty that sells in Brevard and Asheville, NC. My wife and I are interested in the BRRR and househacking methods for investing. I just got pre-qualified to purchase my first house!

Thank you and take care.

-JP