All Forum Posts by: Larry Hucks

update my credit is between 627-657.

Hello,

I recently sold a property in SoCal and I am looking to use the funds for a 1031 exchange. I used to have a credit score in the 760s but I bought a distressed property and used credit cards to rehab it, causing my credit score to drop to around the 600-620s, but my plan was to do a cash out refi on 5/1/2020 (that'll be 6 months since I bought the property via hard money) so I can pay off the debts.

Is there anyone who can lend 30 year fixed conventional investment loan with lower credit? I have multiple mortgages and cash flowing properties and good DTI, I have just never been faced with a situation of trying to get lending with low credit. I have a timeline to identify my properties for my 1031 exchange as well.

Thanks

Hello

I am looking to buy a SFR or duplex in Portland suburbs such as Beaverton, Tigard, King City, etc. I will be using funds from a current sale I have in California and will do a 1031 exchange. Looking for an agent that has experience with primary residencies and investment properties and connections with flexible lenders. Please PM me so we can discuss further.

Thanks

Mahmoud

Got it, that makes sense. Also sounds super complicated if I were to buy an SFR and rent it out. Probably the best thing is to use the 1031 as intended - for another true investment property.

 Thanks for tagging him

Hello BP family

I am currently putting an investment property on the market with the idea of doing a 1031 exchange. I would like to by an SFR and "house hack" - live in one room and rent out the others. But, I was reading that you cant use the 1031 for a primary residence. How would I go about this? Would I have to buy the new SFR as an investment property and just live in it, or can I buy it as a primary residence and say I will rent it out?

I am asking in terms of the loan itself since a primary residence loan tends to have a lower interest rate, and also trying to not do mortgage fraud (although my intentions aren't to do mortgage fraud, I really do plan on renting the new property, but I also want to live in a room). Does the IRS actually check what the loan is classified under? Who does the actual verification that the new property is a rental? Could I say I am buying the new property on an investment loan and then eventually convert it to a primary residence?

I guess the real question is for house hackers, do you buy the property as your primary residence or as an investment property?

Thanks for any advice or experience in this subject.

@Dawn Anastasi the property i am buying in california has a section 8 tenant living month to month and I am just assuming that lease. By any chance would you know if the 90 day notice to vacate given by the seller will roll over to me when escrow closes?

@Nathan Miller what if it is something as simple as just wanting to raise the rent to higher than what the voucher affords or higher than the fair market rent that the housing authority determines? Because if I say I want to improve the house and I can't improve it with a tenant in there and force them out, by law wouldn't I have to let them back in after "improving" it?

@Nathan Miller yes I am still waiting on the copy from the seller since we are still in escrow, but I will be getting the 90 day notice copy. It has also been sent to the case manager. As for the tenants honoring it, I haven't heard that they won't be, but I just have to wait and see. By the way, this is the important part of the HUD doc I was questioning about:

d. Other good cause for termination of tenancy 

(1) During the initial lease term, other good cause for termination of tenancy must be something the family did or failed to do. 

(2) During the initial lease term or during any extension term, other good cause may include: (a) Disturbance of neighbors, (b) Destruction of property, or (c) Living or housekeeping habits that cause damage to the unit or premises.

(3) After the initial lease term, such good cause may include: (a) The tenant’s failure to accept the owner’s offer of a new lease or revision; (b) The owner’s desire to use the unit for personal or family use or for a purpose other than use as a residential rental unit; or (c) A business or economic reason for termination of the tenancy (such as sale of the property, renovation of the unit, the owner’s desire to rent at a higher price

for bullet 3, since its after the initial lease, reasoning such as the fact that I no longer want to accept section 8 vouchers and no longer want to be a section 8 landlord qualify for bullet C (business/economic reason), right?

@Nathan Miller do you know where the HUD application comes into play? Do all section 8 landlords have to fill it out?

http://portal.hud.gov/hudportal/documents/huddoc?id=52641.pdf

For example in the application it says in order to terminate tenancy, there must be good cause. So if I am interpreting you correctly, I can terminate a lease without good cause after the initial lease, correct? What if I am buying a house with a section 8 tenant that has already received a 90 day notice to vacate? Does that roll over to me when we close escrow? I would assume it does because I am honoring the month to month tenancy that the current landlord and tenant are agreed apon, and the landlord gave them the 90 day vacate notice which must be honored. This is from the HUD application:

d. Other good cause for termination of tenancy 

(1) During the initial lease term, other good cause for termination of tenancy must be something the family did or failed to do. 

(2) During the initial lease term or during any extension term, other good cause may include: (a) Disturbance of neighbors, (b) Destruction of property, or (c) Living or housekeeping habits that cause damage to the unit or premises. 

(3) After the initial lease term, such good cause may include: (a) The tenant’s failure to accept the owner’s offer of a new lease or revision; (b) The owner’s desire to use the unit for personal or family use or for a purpose other than use as a residential rental unit; or (c) A business or economic reason for termination of the tenancy (such as sale of the property, renovation of the unit, the owner’s desire to rent the unit for a higher rent).