All Forum Posts by: Kevin S.

@Devin Wilkinson not sure about the tax records in TN, but here where I'm at you see this occasionally when someone buys a bunch of properties in a bundle, i.e. the $249,909 may represent this property and several others all sold at the same time and of that only approximately $56,700 is truly allocated to this property.

@Manuel Lattanzio okay that makes way more sense, thanks for clarifying

@Joshua Duyck You're missing repairs and maintenance (5%), CapX (10%), Vacancy (8%), insurance outside of PMI (lets say $100/month, no clue what rates are in your area), taxes (let's say 5%/month on taxes), and even if you are planning on living there and self managing you should still estimate paying a property manager sometime in the future (10%). In other words you understated your expenses by $1,050/month. Basically you would break even and make $0 on this property based on that. You need to research and know what expenses beyond just the principal, interest, and PMI go into owning a rental.

@Manuel Lattanzio congrats, sounds like you found a good cash flowing property! Quick question though, you said the rental income from the one unit who was paying $700/month covered your mortgage payment each month. However if I run the numbers ($217,125 financed @ 3.725% over 30 years) your monthly mortgage principal/interest payment (excluding escrow taxes/insurance/etc. and variable expenses) should be around $1,002/month. Am I missing something?

@James Wise I absolutely think that there's too much promotion of the "no money down" investing. Look, I get that some people have made that work for them as a beginning strategy, but those people probably worked their butts off, now it seems like so many see it as the quick, easy way to fix all their financial problems. From my perspective, there is no quick fix in REI, it's a long-term strategy and realistically requires a certain amount of liquidity to get started in.

@Amber K. basically a 404c plan is one that gives participants the option to self-direct their investment choices (w/in certain limitations). It does reduce the risk for companies somewhat as participants have a harder time suing a company over the investment choices offered within a plan (due to low performance, high fees, etc.) if participants have the option to choose from basically most all common stock, mutual funds, etc. The downside is that you really need to do you homework if you are choosing investments outside of those offered by the plan, and unfortunately many people that choose the self-direct option seem to just randomly pick investments without looking at performance, fees, etc. (and usually end up choosing either weird/complicated investments who's return isn't any greater than a mutual fund).

@Account Closed it depends on what is written in the contract, generally charging interest is something a seller-financing deal CAN (not must or must not) have, it just depends on what the seller is looking for. Some sellers want a higher sales price but won't charge interest, some will have a lower price but also charge interest, etc. it all depends on what you and the seller negotiate.

@James Dean-Howell I'm not sure about you're first question, but regarding your second question on whether you were being reasonable or not, I'd say it depends on if you were up front with her from the beginning about being an investor and the possibility of submitting low-ball offers. However, based on you saying "given how Lansing is a very hot market and is probably due for a crash soon" I would guess that she was correct that there was no point in submitting that low of an offer (if the market really is running that hot). Also, if you truly feel that a crash is coming soon why would you be buying at current market prices (or even 80% of current market prices)? Going forward if you find another agent to work with I would be completely up front with them about you wanting to submit what they would consider low-ball offers, if they aren't comfortable with that then they aren't who you're looking for. Good luck

@Account Closed pretty sure (and double-checked it on the site you linked) that the One Time Close loans are for 1 unit properties only, which wouldn't work for him.

@Minuit Spence my tip would be to save, work on your credit score, and learn as much about REI (through reading books, BP, podcasts, youtube, etc.) while you do so. Only once you've got some liquidity saved up and a decent credit score would I recommend starting to acquire properties, but that is just my own personal opinion. Good luck!