All Forum Posts by: Justin Spencer

Hey there, 

I've lived in my current primary residence for the last 26 months in a row.  I rent out 4 of the 5 bedrooms here and live in the 5th.

Lets say I want to go get an apartment/studio in order to increase my productivity and eliminate distractions, and rent out my 5th bedroom.

Let's say I want to sell the house at any time within the following 24 months.

The 2 out of 5 year rule still applies right?  I do not want to pay 23.8% in taxes on capital gains.

Thanks for your thoughts, Justin

@Shiloh Lundahl, awesome thanks man, appreciate your feedback!

Hey there,

I have a SFH right now with an 80% LTV.

I live in Mesa, AZ and I found one credit union (Credit Union West), that advertised HELOC's of up to 100% LTV.

However, today I called and spoke to a loan officer and due to covid-19 they reduced it to 90% LTV.

Which is still better than the average lender offer... but frustrating still the same because 100% would have given me a huge line of credit.

However, I'd still like to find a way to leverage that other 10% equity that's doing nothing which is about $50 to $60k.

I was thinking perhaps I could find an independent investor who may be interested.

But I need some perspective on who, where and how I'd make that kind of offer.

I would like to get a single digit interest rate from 4 to 9% range using the equity as collateral and to make interest only payments for as long as possible on the balance borrowed, same concept as a heloc.

Looking to use the capital to invest in another SFH. I do house hacking, so I live with roommates who pay for 100% of the mortgage + utilities on my current house and I'd like to get another one to do the same thing.

My credit is flawless in every shape of the word, and I'm 29 and have borrowed probably 500k+ over 11 years and have never had a missed/late payment or single dot in that regard and have paid off tons of things quicker than expected.

I am trying to understand the mindset of someone who would consider making me an offer based on my outcome defined above, who is not a credit union or bank, which I assume would never consider making me this kind of offer regardless of my high income and perfect credit.

Thanks and curious to hear your thoughts, Justin

@Shiloh Lundahl, do you know if Kyle had to send in a notification to the county assessor to let them know that the first house is no longer a primary residence and is to now be treated as a rental property?

Also regarding, me entering the home, could I leave 1 room 'vacant' on purpose and assume it's 'my room' to 'get around' the 48-hour consent-based landlord entering the house guideline/rule written by the az landlord/tenant act?

When I was researching the az dept of housing / ll + tenant act I started laughing out loud because it says directly on their website word for word: 

"There is currently no state agency that enforces provisions in the Act, and because most landlord/tenant relations are private transactions, disputes that arise between landlord and tenants are generally considered private matters." 

So in other words, nobody enforces anything regarding this act.  So as long as I treat everyone fairly, reasonably, justly, cleanly and responsibly (golden rule), I should not have a problem!  I think.  

I also 'skimmed' through the entire 47-page act/pdf looking for anything that would "surprise me" and didn't seem to find much that surprised me if anything, the key thing was just the 48-hour consent based heads up on entering the property.

Anyone else agree or disagree? @Colby D Hollins and @Ryan Howell, thanks!

Hi there,

I currently live in Mesa, Arizona - I live in a 5-bedroom/3-bathroom house.

I live in the Master Suite and rent out the other 4-rooms @ $750/piece quite successfully and have a solid group of guys I find through FB ads, then I screen with MySmartMove dot com, then we sign room rental leases.

I believe I am currently in a position to get a $60k+ or higher heloc on my current home.

I was thinking about drawing on that 60k + holding the cash in an account for 2 months, and then buying another 5-Bed/3-Bath house under the guise of a primary-residence to put down 5% with PMI and then turning this existing home which has 80% LTV, into a rental.

I prefer to rent out room's individually since I can make alot more cash, and I have little to no trouble finding solid people to live in them since my main profession is marketing/communication and sales and "people" so to say.

So I have several questions:

1). Would you rather just rent out the entire house to a 1-family unit with a 12 month lease and break-even on it?  Or would you side with my idea of collecting upwards of $800-$1000/mo in cash-flow after all expenses by renting out each room?

2).  If i were to do the room-rental idea, I don't know how Arizona laws work regarding what a landlord can and cannot do regarding his rental for entering the house (to show rooms), etc.  Could I have each room renter tenant sign + agree to a bunch of disclosures about when/why I'd be in the house and how much notice I'd have to give them or what not to show rooms or inspect repairs, etc?

3). Are there any legal constraints to doing this particular idea?  In any shape or form I'm not considering?

The 4 guys I live with now could actually just "move" with me to the new primary residence house and I could in affect just rent out the old house to a family at 12/mo's with current market rental rates, or I could do it room-by-room and stand to make a whole lot more.

4). I wonder what the banks need to know (my credit scores are 740+) and my DTI right now is 40% or so at current, to approve me for that new loan?

Curious about your thoughts and feedback on these ideas?

Thank you,

Justin