All Forum Posts by: KJ D'Costa

@Brandon Hicks At the risk of hijacking this thread, what happened with your SFHs? Feel free to PM, if you prefer. 

@Bridgette I. (Mrs. Roeper?! Funny.) 

I found this from a news site:

"For mortgage lenders, there is the FICO Mortgage Score. The FICO Mortgage score places an emphasis on how you've handled property in the past. This includes all public property records, rental history and evictions, previous mortgages and property tax payment records. By placing a strong focus on the most relevant parts of your credit history, the lender can determine if you are likely to manage your mortgage responsibly in the future."

I think it's a bit bogus, because they are not analyzing your debt repayment habits in a holistic manner, but this is one thing that none of us can do anything about...other than circumventing traditional lending.

@Dawn Anastasi What I find particularly galling is that you have to pay a nice bit just to see information about yourself and a credit report doesn't reveal your score. You need to pony up more for that. And even more for all three. Whoever cooked this up is brilliant. And FICO just recently starting revealing the multiple scores based on lender type. So at least there's that. But I guarantee that there are countless borrowers who are shocked at the higher rates they're getting, and don't think to ask about the scores their lenders are actually looking at. 

There are consumer FICO scores and lender FICO scores that differ by product (car, credit card, mortgage etc.) FICO finally decided to reveal those other scores when purchasing their score product direct from them. Secondly, note that FICO also updates their algorithms, changing what factors have more or less weight. They push out the new update/version, but some lenders are still on the older versions, which may or may not benefit you. 

For example in recent months, FICO decided to lessen the impact of medical collections, really minimizing the damage a collection can do to a score. Your personal FiCO score will reflect that change now, and FICO also pushed out the new lender versions ( I think it's ver. 8 now) but a lot of lenders are still using the previous versions as they are slow to adopt algo changes.

Hope that helps.

This thread hits home for me, because before I joined Bigger Pockets, I too had "lofty goals". I decided to spend six months reading and researching as much possible on markets and strategies to determine the best way to get to my monthly goal given my income, cash on hand and credit score.

After being on here for awhile, I've noticed distinct investor camps, the first I'll call long-term retirement investors. Those that either purchase a property once a year, or save to buy each property in cash, within the intent of either cashing out on appreciation in the distant future or accumulating a few thousand in cash flow to bulk up retirement income.

The second camp, I'll call cash-flow now, damnit, investors. These folks have much shorter time frames for achieving their goals and tend to think out-of-the box (@Brandon Hicks is an example) or have a bunch of creative strategies up their sleeves (and are usually questioned as to their validity) or venturing into "rougher" territory.

Those that fall into the second camp tend to get cornered and interrogated an awful lot. So I can see a lot of newbie investors getting scared off from doing anything outside of mainstream real estate investing. The irony is that it reminds me of when I started an online retail business a few years ago and got so much flack from people that I should just focus on my W2 job and that anything online is either too hard or too shady. The similarities here are more than tangential. However, that online business gave me a nest egg in which to start my RE business. So I think risk is necessary and detaching from the mainstream important to financial success. 

Anyway, sorry if I've really hijacked this thread, but there are some days, after reading a bunch of posts, I feel like going back to the online world or just dump some cash into REIT and wait from my Medicare to kick in (shoot me now). And then there are days when I research the financing end of my plan (which apparently is EVERYBODY's issue), and find what seems to be good solutions to the DTI issue (Fannie Mae allows up to 75% of rental income to count), property seasoning (some lenders just a need a month, some 90 days, and these are from lenders here on the forum and all lenders apparently will count rental income after two years) 10 property limits (if married, your spouse can take on another 10. After a total of 20, apparently portfolio lenders can do a blanket loan and bring your actual mortgage back to one, thereby starting the process again.) And then there's the world of commercial finance, which I'm still learning and don't feel confident to comment on.

Obviously, there are some factors you can't get around - some cash on hand for the HML (rehab acquisition) some more cash on hand for reserves and decent credit score (for the refi) and good property management and through knowledge of your market (for the rental)

So, my obvious question is, what's the problem with rehab, rent and refi? Because threads like these are so utterly demoralizing. Notice that I didn't detail my goals. It's been crushed enough already, unbeknownst to all.

Anyway, can @Jerry Padilla  and @Bob Green , comment please on the lending end. I think it'll help elevate the conversation.

I figured it was overboard. Overreaction, I guess, in an attempt to avoid the problems others have suffered.

However, the cigarette test, I like. Thanks @Steven J.

So after reading several horror stories about contractors and apparently the increasing need to both babysit and warden them, I wonder if there was more effective way. Has anyone installed security cameras inside their flips to monitor the crew via live feed? I once kenneled my dog and the owner gave his clients a web address to view both the kennel and play area while away.  Would it work, or is it a bit overboard?

@Rusty Scott 

Can you clarify what you mean about your cost to obtain being lower and easier? Thanks.

@Chris Soignier 

Hi Chris, to answer your question my acquisition strategy is to rehab and rent, which is dictating my initial moves. I want to cut my teeth on SFH rehabs, before I tackle 2-4 units, then onto commercial properties. I'm completely with you in multifamilies, and that's the long term plan.

Seems you can't tag more than one person at a time, so sorry for the barge of posts. 

@Laura Williams