All Forum Posts by: Kristina Heimstaedt

Hi @Steven Lee. I think I mention this about once a day on average on BP. I'm a huge fan of the purchase, HELOC and hold until you'd be stupid not to purchase the deals popping up around you. I have one hesitation. My plumber of all people actually owned his home, but had a first and a HELOC. As an independent contractor who showed losses during the down turn despite his 800 plus credit score, could not access his HELOC because he had not used it in the past. I've recently been strategizing what I would use to purchase with my HELOC where the financing would be positive. When I say positive, I mean if the HELOC has an interest of 5% and a car loan would have interest at 6% that would be positive. If my car loan is at 4%, this isn't positive.

I personally think it is an excellent strategy, but everyone has a different opinion. 

If I were in your shoes I would pass it though another insurance company. Let them either match or not match what your current insurance company says. I might also talk to a lender. If everyone isn't phased, you should be good to go. Everyone should want to make sure that they get paid and not want to tie up a property that will ultimately not perform. 

@Nicholas Johnson that sounds great!!! Glad to help. Be sure to let everyone know when you've given yourself a nice gift to end the year (your first house)!!! Go team!!!

Get educated and make them work for you. That lending tree commercial about you sitting in your underwear and getting the banks to compete for you is real. 

I always appreciate an educated client and I know lenders do too. We have several loans through one bank in particular and I went in to talk to them about obtaining a commercial loan which would have been new for us. When I went in, I had our entire portfolio break down including the properties with the following information: the purchase price, the current value, the mortgages, the type of loan, and the income and vacancies for each property. I also printed out a complete MLS break down of the target property along with what our expectation of income would be once we obtained ownership including what capital expenditures it would cost to get it to our standard of cash flow. With this information, I got the red carpet treatment and nearly intimidated everyone in there.

Obviously this isn't your position if it's your first deal. However, what you can do is talk to the lender and tell them what your goals are. Maybe you are trying to house hack and you would like to pay off your first deal in x number of years. Maybe you're house hacking and you will get a HELOC right away to be ready for the next hiccup in the market and buy everything you can get your hands on. Maybe you know what type of properties you'd like to target for your house hack.

I like to think of the bank as my mom who will give me money as long as she thinks that I'm going to make good choices. I tell my clients that I want to help them make good investments so that when their property performs well, we get to go do it again and everyone wins. That's more or less what the bank wants too. 

You got this!!!

@Nero Leblanc you're in California and property taxes can make up a significant part of your expenses. The other aspect of California is that we can have significant swings and when you're talking about 500k-2mil values, you're talking about 5-25k/year in property taxes that can eat into your profits. Know where you are in the market in terms of timing. Listen to @Kyle McCorkel and get educated. Learn about leverage. Talk to other investors and not necessarily people who will profit from your transactions. My commercial lender hasn't been able to finance on more than 50% of a purchase for some time here because of the debt to service income ratio. This isn't because he isn't good at what he does. The amount of risk he is allowed to take isn't more than 50% of the value. 

The other thing I would add is to participate in the forums and watch who you think seems to know what they're doing. Talk to them and see if you can't go over a deal with them and have them help break opportunities down for you. If you really see something that seems worth it, complete a reverse exchange or do a cash out refinance on one of the existing homes. 

You got this!!! Congratulations on becoming a landlord!!!

Calculated Risk Blog Bill McBride is the man. The movie "The Big Short" was real. Go based on numbers not your gut feeling. Your gut can help with some things, but don't ever rely on your gut when it comes to your pocket book. Ask people how they ended up with tenants from hell? Chances are it's because they didn't look at the full profile and didn't run their property like a business. Would you trust someone to build a bridge based on their gut feeling over an engineer using numbers? No. Keep with the KISS model of looking at numbers and not asking your gut about its feelings and you should be just fine. 

I would call the employer. 9 times out of 10 a new job is a good thing. However, I still call and make sure that the employer is happy with my prospective tenant.

Everyone makes mistakes and people move for all sorts of reasons. Moving because your ex lives down the street seems like a good reason to me. 

The fact that you know her and she went through the background check would be reason enough for me to want to take her. Most people I know would want me to go based on the fact that I know them exclusively. Sounds like she will be fine. I might just tell her about Uber/Lyft or something along those lines.

@Jessey Kwong I would also echo @Mindy Jensen's sentiments. It's nice to completely nerd out with people who live, eat and breathe real estate the way I do. 

I got into real estate managing my parents portfolio of properties and turned into a landlord at a very young age. I've learned a lot from them and the few other people I know, but have also learned some extra tricks here.

By participating in the forums, I've personally found that I'm a pretty good landlord and it's allowed me to help other people on the site. I was always confident about my ability to use financial models to determine what the strike zone for a particular opportunity might be, but when you're the same age or younger than some of your tenants, things can get a little awkward. Like I said, participating in the forums has shown me that I'm actually pretty good at being a landlord despite some of the challenges I might have.

I've been fortunate enough to have lots of people respond on questions about financing and some other situations/areas that I'm not nearly as well versed in. I look at everything as I can contribute well when it comes to landlord tenant relations and I benefit from learning about the financing side and more. 

Everyone has differing opinions one way or another and there are some that I agree with and others that I don't. By participating frequently, you begin to see patterns/trends from other posters and maybe develop on whose opinions you give more merit to. I haven't been here long, but I have met people through the site, no business yet, but it has certainly helped me learn more and develop confidence for working with my existing clients and future clients. It's been extremely valuable to confirm my knowledge and not feeling so much like an entitled brat who inherited her parent's portfolio and playing dress up as a real estate agent every day. 

It's my understanding that this is a software often used by large real estate investing firms to analyze opportunities. I'm curious if anyone uses it to help assess/analyze potential opportunities. Also curious as to what extent it is worth it for those who know about it.

THX

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