All Forum Posts by: Lance Knapp

Caleb, I mean exactly that. A non owner occupied property that is a triplex or fourplex. I think you are right.. That is what I was fearing. I guess the difference in underwriting the non owner occupied is you can account for rents from all of the units with no vacant owner unit. Higher interest rate and higher down payment ... I will look to stay in the owner occupied range then.

Hi All,

I am considering taking a job that pays quite a bit less than my current job but would be a good long term move for my RE career. I am hoping to purchase my second triplex soon. I probably will not be able to approve for the deal size that I want using residential financing, therefore I am interested in using an investment loan. Can someone tell me the difference in approval process by purchasing a property using an investment loan vs a home loan (owner occupied)? My goal would be to buy a property with below market rents in a nice area, fix it up, then lease it up at market rents.

With an investment loan does the lender still look at your personal DTI? Or does the lender look at the CF of the property (would be weak since I'm buying a property with low rents)?

Thank you,

Lance

Hi,

I recently purchased a primary residence investment property. My plan is to move out after one year and rent out my owner's unit. Once done, I am going to switch to a landlord's insurance policy. For additional protection, I would like to have it under an LLC. Is this possible without having to refinance to an investment loan?

Thanks,

Lance

Hi, I'm am curious if anyone can help clear up the proposed tax reforms that would affect real estate. 1) would interest no longer be a deductible expense for investment properties...? 2) would there be no 10-31 exchanges, but instead you depreciate your new building purchase upon purchase (so it can write off your investment gain from your sold property)? Does this mean we would no longer be able to write off depreciation over roughly 30 years against rental income?? 

I look forward to insights on this. Thank you!

thank you for the informative replies! If I plan on moving out of my owner unit after a year, I imagine that I will need to switch to a landlord insurance policy.

Hi, I closed on an owner occupied triplex three months ago. I got a standard CA homeowner's policy that is $126/mo with a $1,500 deductible.

My Dad brought up that since I have tenants, I may need landlord's insurance that would protect me further. Does anyone have advice on whether I should keep my policy or switch to a landlord insurance policy?

Thank you

Appreciate the replies! It puts my mind at ease. My only fear is that my cousin recently had an issue in the same scenario. He claims the lender actually checked and concluded that he wasn't living there, so he ended up leaving the unit vacant, putting in some furniture, and trying to make it appear like his legitimate primary residence. Think he just was extremely unlucky?

Two months ago, I closed on a triplex using a 20% down conventional home mortgage. I had intended to live there, but I came to realize that my commute to work wasn't feasible. Also, the perfect alternative living situation arose, so I moved. I now am in breach of my agreement to live at the property for one year. I am unable to leave my unit of the investment property vacant, so I need to rent it out. So far, the lender has not checked if I am living at the property or not (it has only been two months). Does anyone have experience with this type of situation?

@Account Closed That is an awesome story. This is renewing my confidence to go out and buy a property where I can create equity off the bat. I am thinking either Santa Monica or West LA, perhaps a nice single family home that I can rent out (since I don't have enough money for anything more than that).

 @Account Closed that is a great point. I know that my Dad missed out on many deals during the same time frame. There are always reasons not to invest. But what about in 2007 (not that we are there now), was that a time to invest? I know lending has become much more conservative. I see what you are saying and think it makes total sense. I still think I would feel more comfortable buying at the bottom vs. the top. Anyways, now is not like 2007, so it likely is as good a time as ever. Thank you Bob