All Forum Posts by: Jon Horton

I used State Farm Bank and it was a long process as well. 

I used it to pay off my primary home mortgage in order to speed up getting rid of that debt. As the balance gets a little lower, I will then use the HELOC funds to aggressively start paying off mortgages on SFH rentals since my goal is to have those rentals debt free. Once they are debt free, I will then feel more secure and more risk tolerant.

Many will disagree with the strategy of paying off the debt but what makes me happy is being comfortable and that makes me feel comfortable.

I did that and it works great for me. There is a strategy, requiring self discipline, you need to use to make it work but it works great.

PM me and we can jump on a call  where I would be happy to share the logic.

I use them currently. I have 7 SFH in KC. My experience has not been the best but it is not super bad either.

Are you looking for a builder partner or GC for the build?

I completed a teardown/new build with a builder partner where the finished product sold for $1.27 m. Same builder is working on another project where the final product is projected to be in the $3 - 3.5 m range.

The right thing to do is what fits in with your goal. 

If your goal is to own rental property free and clear, then your focus should be on paying down those notes. Buy a couple of them and use the cash flow from both to pay off one note. Rinse and repeat.

If your goal is to own a lot of properties that are cash flowing, then focus on how to best leverage what you have without putting yourself at too much of a risk and buy, buy, buy. What is too much risk? See above...it is what fits in with your risk tolerance. 

The pattern here is that every person has their own idea of right. Use your education/knowledge to help decide.

Define your goal and your path to get there becomes less cluttered with shiny objects that can distract you.

Mark,

I agree with both of the above posts, to a certain extent. 

I think you should make sure you fully understand the numbers and they are realistic. Taxes, vacancy, repairs, cap ex, PI costs and rent rate.

I think you should thoroughly vet out property management team, unless you are going to manage them yourself. Managing yourself could go really bad or be smooth but the impact of that decision can highly impact your desire to continue in real estate or not, depending on your mindset.

Finding a lender, in my experience, is not difficult. Phone calls to ask questions, references from other investors in your area and then gut feeling will help guide you.

Asking questions is a great start!

All the best.

Jon

My thoughts are it is a very personal preference. I personally like the idea of travel points. It makes my trips feel like free where as if I had to pay with cash (with the cashback cash) if does not feel as though I "got it for free". 

Other than that, if someone has an analysis addiction (like many real estate people do), I would think that it would be a moving target requiring evaluation often to fulfill the need to always get the very best deal / to ensure your are getting that last drop of benefit. Time spent vs reward comes to mind.

My two cents :)

Scenario:  $450k to invest

Background: Currently have 7 SFH rentals (turnkey purchase) that are currently financed with 1 commercial loan (so that I could get HELOC to pay off house and car notes quickly) and 1 tear down / new build under my belt. Have a busy W2 day job and not a lot of free time.

Goal is growth of current portfolio to ultimately fund retirement. I am currently 54 yrs old.

Given the above info, how would you invest the $450k? All SFH rentals? Another tear down/new build? Learn and do MF investment (small or join large deal)? Notes? Raw land flipping?

Just looking for ideas and opinions. Bring it on!

Another consideration is to build up cash first through flips. Find a partner, do a few flips, take some the cash to aquire rentals and repeat. Just rentals alone will take a really long time scale.

From my perspective, this is a marathon not a sprint. Passive income is great but it takes a while to get there. Patience is a virtue.

Another option is to search on loopnet. I have not yet done any MFUs but am starting to get interested and having been trolling there.