All Forum Posts by: Lior Rozhansky

@Peter Pezzano Anything in particular you know of that is making Malden become on the rise? I wouldn't really consider Medford on the rise---Tufts has been there forever, and there hasn't been any big shift in population or economic growth from what I'm aware of..But would be interested in hearing your perspective on Malden. I just invested in Everett, which has the Casino construction going now, though who knows how that will effect values (studies have been done that showed some areas have increase and some have decrease in property values with new casinos). And Eastie is dangerous...so much hype there, its easy to overpay 

Massachusetts Home Inspections run by David Valley. He did mine and did a great job--efficient, fair priced, knew what he was talking about, and didnt play any of the seller's agent games. 

Thanks @Wayne Brooks makes sense just wanted to check that. My lender is fully aware we are just finishing up final details now to make sure this all works. If this works, it will be a nice way to get quick equity to refi out of FHA and get rid of PMI

Hi BP, 

I'm currently structuring a deal which I need to present to my seller tomorrow. Essentially, my seller is willing to do some owner financing in addition to the FHA loan. I will obviously disclose everything to the lender and make sure that my DTI still stands acceptable (and I have seen the HUD requirements to get a carry-back approved, and met them all).

My question is is there a difference on whether the seller financed note is secured or unsecured with regards to a possible refinance? What I mean is if I get the seller to take an unsecured note (with a better interest rate to compensate him on additional risk), will that debt be counted as part of the "loan" in an LTV assessment if I try to get the property refinanced in a year (essentially will that note amount become instant equity for me which I can play with?). Or will the unsecured note be treated the same as a secured note at second position lien and be counted as part of LTV when I go and try to refi the place?

And if the latter is the case, is there anything I can do to create a note that is not assessed as part of the debt for the property, but is rather stand-alone debt?

Thanks everyone!

@Jason Higgins Sounds like a good plan. Curious, where in the Boston area are you looking to find a duplex for 100K? If you know of a city with those prices around here, let me know! The one thing I would say and far more important price point is the amount of cash you have in the bank. yes, you can drop that 5K on the downpayment, but what happens if you have a tenant that doesnt pay rent or your water heater explodes? You need to have cash (could be yours, your parents) to make sure you can keep afloat---thats why I was saving for a year on a salary to make sure I have money not only for downpayment, but for a rainy day. Judging by your stated income, that's not going to really help you at all if your property takes a sharp left turn...

@Ryan Drowne I just landed my first 3 family in Everett. I was essentially in the same position you are now from April to July. Its tough to get into a lot of these markets (im assuming you are using conventional financing) just because these houses are going for cash or way over asking (i put in MANY offers in East Boston, Waltham, Everett, Quincy etc). Best piece of advice I could give is make sure the numbers work before you offer, and make sure you have a good understanding of the neighborhoods of where you offer---im sure you know, but there can be some big differences from neighborhood to neighborhood. I would also follow with this---keep throwing (calculated offers). I was rejected so many times, you just need to persevere. Eventually, something will stick.

@David Santore I actually just did my first house hacking deal. Its a 3 family in Everett. I would say not to just strictly compare the mortgage vs the rentals---you need to look at the entire property analysis (i.e you want to look at vacancy rates, maintenance, capex etc). After analyzing many deals in the greater boston area, from quincy to waltham to east boston, I personally saw that it will be tough to cash flow positive when being an owner occupant. That being said, if you only need to pay say 500 bucks a month (not to match just the PITI, but all operational expenses), then its really not a bad deal. Just make sure that the property cash flows when all units are rented out (which you can do after a year of owner occupying). And in terms of condition of property to look for, obviously something that is more distressed could be good because you can gain that equity through some work, but its tough in boston (so much competition, cash buyers etc). My property is essentially more or less ready to go, but i know it cash flow about 500 a month when fully rented out so I think its a solid base hit for a first deal.

@Andrew Beaver I can defintely give you the perspective of my experience, but I would also suggest reaching out to those with more experience as well. With respect to driving for dollars and distressed properties, I did so with the plan of using 203K loan to fix it up. Any listing thats on the MLS for distressed property is more than likely going to go to a cash buyer or well over the asking price (anywhere in the boston area), so I would say your best bet if you are using these loans is to do driving for dollars. I did it, and I had a really low success rate with sending letters etc, but thats part of the game. Also FYI, make sure you read into the description of the NACA loan, because from what I remember, they have some really unfavorable criteria for investors, so just double check before you use it. In terms of logistics of driving, you are certainly doing it very thoroughly. The way I did it is just choose some neighborhoods and then just get a feel for the area--you dont need to hit every street corner. I would say the most efficient way to get in the game is just literally submit ALOT of offers. Make sure your numbers work on each deal, and then just keep sending every day. That's what I did, and though it took a long time, eventually one offer stuck.

@Account Closed There's multiple things you can do. First I would suggest getting in touch with a real estate agent; not just any agent, but one that knows the market you are interested in and can help you hustle for deals (if you need a reference for one in the greater Boston area, I work with an awesome agent who knows the market, hustles for off market deals---PM me and I'm more than happy to refer you to him). Besides that, I would say being on the ground defintely helps---if you can take a few hours every weekend to drive up here, I think it will be of an immense benefit. Is it the msot efficient? maybe not. Is it the most informative? I would argue so. Finally, i would literally just google economic news. Every town I'm interested in I first google the town's name +business development. You want to see what the future prospects of your town looks like--are there any major companies moving there, any major construction etc etc. One of the best things I've read is that in RE investing, you are not investing in the house per se; you are investing in the area. So if I can, I look for towns that are actively developing and improving, and thats where I would look to put my money in. 

Clovis, I would voice some of the previous comments on here; if you are from the Fall River area, and you know the market and have some infrastructure there, you have a competitive advantage there. By moving to a brand new market, you essentially start from square one in terms of market knowledge and team etc. Not a end-all barrier, but something to consider. In terms of your situation and desire to invest in Boston market, I am in a similar situation as you (similar salary, through I've been working for a year and have a bit more saved up). I just got my first 3 fam in the Everett area, and I can tell you with your savings, you could technically afford a house like that if you would go down the FHA path, but you would be skim on reserves in the bank which would be worrisome. In terms of markets to consider, there is no "emerging" markets here, but as areas such as Somerville and Cambridge become too expensive, we may see areas such as Everett, Chelsea, East Boston, Revere, Quincy etc etc start gaining more and more traction. I would defintely suggest reading the economic landscape of each city to see the direction it is heading in (i.e business development---Everett, for example, will have a Wynn Casino soon. We'll how that impacts house values though). And nice part about those cities I mentioned is you are within 15 minutes of boston. Now, as I harshly found out, getting any deal here (on or off market) is so hard right now. Competition and hype is through the roof now, so be ready to submitting many, many offers (as I did before landing one). If you are looking for slightly "cheaper" markets, you could try to venture to the metrowest area (Natick, Framingham). Again, do your homework on your city! Good luck!