All Forum Posts by: Keith Andrews

Yes, interest rates have increased.  Yes, it is more expensive to borrow than it was 2 years ago.  However, in the big scheme of things, we still have historically low interest rates and rents have gone up as high as 20% in the last year.  

It cost more to borrow money, but it cost significantly more not to!  I'm still buying and cash flowing like I always have.  

The easiest way to start is with the home you currently live in. Rent it out and use a VA/FHA loan and buy a home you can house hack (single home with an ADU/duplex/triplex/4-plex). Don't own a house? Get a VA/FHA loan and buy one. Do that a few times, you'll soon have the equity in the others that you can use to buy investment properties to buy and hold. My favorite are BRRRRs. Find homes you can force equity, get your original investment back from a cash out refi and be able to charge higher rents in. Once you get to about 5, time to start thinking about commercial loans, putting your houses in trusts and making the beneficiary an LLC. Lot's of options for sure, but the best place to start is with the home you live in (if you already own it). Don't want to move or don't have the 3.5%+ for a down payment? Consider sectioning off a part of your home and using it as a short term rental to save some cash. Bottom line, "There's no place like home".

I'd like to add one more piece to this. Prior to recasting or re-amortizing the loan, see if you can lower your home insurance as well and drop PMI if you happen to have that attached to the loan. I have re-amortized more times than I have refinanced over the years and it has exponentially increased my cash flow.

@Jeffery Smith - I am investor just like you, I own dozens of properties all over the springs and am also an agent. When are the leases up? While evictions are hard right now, when the leases end, you have options. Call me.

@Wale Lawal - Buy and hold and it will all work out wonderfully!

Unfortunately, you are stuck with the current lease terms until it expires.  However, as @Will Fraser suggested, you could ask them to sign a new lease with those terms included, but they legally they don’t have to agree to.  I had a similar situation with a duplex I bought once and was able to get the tenants to agree by lowering their rent a small amount and getting them to start paying the water bill.  In doing this, I was able to increase my net income $100 a month even after lowering both rents.

@Marvin Rios Precisely. The LLC receives the rents, holds 10% (as a fee) and pays me personally and a few of the LLCs I also own that hold properties, so I can pay the mortgages.

@Amir Hemmat check out Colorado Springs, CO. https://www.biggerpockets.com/member-blogs/13626/92641-5-reasons-why-colorado-springs-is-the-best-market-to-buy-rentals

I am an investor, agent, and property manager there. Do your research and if interested I am happy to help.

@Misael Carlos Vera, there are advantages of owning properties under an LLC such as as asset protection and being able to expand your portfolio of financed properties above the max personal limit of 10. However, it is much harder to refinance when the property is not in your name. I'd say if you own less than 10 properties, keep them in your own name and just be sure to have adequate umbrella protection.

Here's a tip though, do open an LLC to act as the property management company for all of your properties. It's a great way to stay organized and to keep things clean. Collect all of your rents and manage all of your property expenses through this company. Start building company credit! This is how I built up my portfolio and have been able to pick up quite a few BRRRRs leveraging business credit instead of my own. If I find a good deal, I can borrow from my company to secure it, rehab it, and then refinance it out to payback my LLC. I have done this dozens of times and the strategy works great.

Wow!  Nice work!