All Forum Posts by: Jose Leanos

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@Matthew Forrest

Hey Matthew thank you for replying, I was wondering if you had time to discuss some of the costs and time frame associated with your ADU?

@Eriverto Espinoza

Thank you so much, after reading into the details I found out way more specific information about LB ADU and jadu rules.

I would still like to chat about my specific structure, I have an attached two car garage that sits right next to the main sewer line. I will give you a call tomorrow to discuss details.

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Jose

@Jon Schwartz

Thank you so much for the useful tips.

I think you are correct, my home could work if I make the garage an ADU and then convert my family room into a junior adu, the only thing is that I would have to build a second bathroom and I would imagine that would be costly.

I have been looking into units in the Long Beach area specifically which is where I live. There is just a very small supply of multi families that are within my price range.

I think you make a great point about how single families have been skyrocketing which is why I had decided to sell mine until I stumbled upon the triplexing of single families.

I will call your adu specialists to see how much the cost would be exactly. If I can refinance, convert into adu and jadu and keep some cash it might be the best strategy. If however I can find some value in units I will go that route.

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Hello all,

I am deciding between selling my single family home in Long Beach, CA in order to purchase a multi family property and using a cash out refinance to build an ADU and junior ADU. I currently have about 55% equity in my home which would net me about 220k(assuming a Loan to Value ration of 80%) and converting my attached garage(400 sq ft) into a junior ADU and then building a free standing ADU in my backyard. I was wondering if anyone had any experience with "triplexing" a single family residence, I wanted to know what some best practices are when doing so, such as whether separate meters will be worth the added cost, what is the down time between permits and construction and lastly what is the actual cost. I have gotten different things online in regards to cost to build and I am assuming that 220k would be enough to cover the costs of the garage conversion to a junior adu and also the building of a free standing structure adu but again I have many questions about this process.

I am torn, because I was really set on selling my home to start house hacking with a multi family property, but the idea of "triplexing" also works out well as far as the numbers are concerned and my mortgage would still remain relatively inexpensive. Added bonus I would not have to move. Please give tips on ADU and junior ADU's in California, or if multifamily is your preferred method why not ADU's and junior ADU's.

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Weighing the pros and cons

Daniel, thank you. After reading the fine print and looking into the topic it seems I will not be able to use rents to qualify for a conventional loan. Given my down payment however I would have enough cash reserves to qualify for an FHA loan with the use of the rents.

Are there any specific caveats when using an FHA loan for multi family properties that I should know about?

Hello all,

I am in the Los Angeles area and looking to sell my single family home to buy a multi family property. I have about 300k in equity and my plan was originally to sell my home and go live in a trailer on my parents property while I worked on a deal for a multi family property. I have read on Fannie Mae however that you need to own a current primary residence or have a current living expense in order to be able to use the rents of the purchased property to offset the mortgage.

I wanted to sell my home first and then buy after in order to increase my leverage when negotiating on both the sale and the purchase but if I can’t use the rents that would greatly diminish my ability to qualify for a bigger loan.

Just because I know it matters, my current salary is about 8k per month with only 1 recurring debt payment(student loans) at $318 per month and my credit score is 760+. My savings are only about 20k with the other 300k being tied up in the equity of the home I currently live in. I know I put a lot of money into the home instead of leveraging or investing, that was my bad.

If any lenders would like to comment I would greatly appreciate it, I am hoping to finance a 3-4 unit in the 1 million dollar range to take advantage of the low loan rates.

-Confused in LA