All Forum Posts by: David Jayne

Very helpful! Thank you. 

Anyone know how to start/join a class action lawsuit against the recently extended eviction moratorium? I have property in Mississippi, not sure if it is state-specific or not. Thank you. 

I pay about the same as @David C. for $500k in coverage. Basic rule of thumb is 10x your annual salary, but I would recommend actually sitting down and figuring out what happens if you die. How much money will your family need? What things would you want paid off so they don't have to worrry about them? Do you want a charitable contribution to be made to someone? Pre-fund college for your kids? Pay off mortgage/cars/rental houses/etc.?

The Rams-meister (great name, btw) is spot on recommending only term insurance. All the other stuff is a joke. Makes the insurance companies and brokers money, but not you. You shouldn't think of life insurance premiums as lost investment, you are insuring against your death, which could be catastrophic for your family, espcially if you are the sole breadwinner. Just think how happy you would be that you paid those premiums if you knew you were about to take your last breath!

"All right, they're on our left, they're on our right, they're in front of us, they're behind us...they can't get away this time."
- Lewis B. "Chesty" Puller, USMC

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Max is $50k. I took out $48,500 in 2010, just paid it off. Caveat is you have to look back 12 months at your loan balance, and subtract that from the $50k max. I have no idea why they do this, but for instance, my balance 12 months ago was about $12k. Thus, if I requested a loan today, I could only pull out $38k ($50k - $12k). Also, you can't originate a loan of the same type (general or residential) until 60 days after you've paid off the previous loan. For instance, I paid off my last loan at the end of December, so I can just now request another general purpose loan.

I haven't done the residential loan, just two general purpose. They were super easy, took a couple of weeks to get the money after I submitted the paperwork (1-2 pages?). Residential requires some additional verification such as a signed contract (don't remember the specifics), so it would probably take a little longer.

Still a great deal overall.

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I believe Michael is right, you can't roll it over until you leave employment with the military. You can close it down, but you will pay about 50% of the balance in taxes/penalties. You can also borrow against it if you want to free up some cash now. I've done two loans, getting ready to do my third. Only $50 admin fee, and you pay yourself back at the G-fund rate (somewhere around 2.25% currently). Only issue is you are supposed to pay it back before you leave or they may require the loan balance to be due upon your separation.

@Michael Stroup,

I have to disagree about the military TSP. True they don't match contributions, but it isn't designed to be a fully-funded retirement plan. If you do 20 years, you get your pension, plus whatever you have in your TSP. Pretty generous when you do the math, and you can borrow against it. Most people would die for that kind of a retirement package! You can keep your match, I'll take 50% of my base pay for the rest of my life.

As for the number of funds, not counting the lifecycle funds, you are correct. But...what else do you need? I can get small cap, large cap, international, bonds, and the ultra-conservative guaranteed G-fund. Plus, the expense ration is 0.027%. That's about 1/4 of the lowest I can find from low-cost mutual funds or ETFs. Sure, index investing is boring, but you can always go crazy with a personal investment account. Nothing stops you from contributing to an IRA on top of your TSP.

I do agree that the Roth is a nice addition, and definitely the way to go.

@Cory Bansfield great idea! Never thought of leveraging VA to buy, then refinance, then repeat. I owe you dinner after I'm rich!

Welcome to BP! I'm active duty as well. I have a few properties in lower income neighborhoods in Kansas City (wouldn't call them war zone, but you can see it from their backyards).

I think there is a sweet spot between the war zone and a middle class neighborhood that makes more sense, especially for your first investment property. If this was a location you knew in and out, already had a property or two, and planned to stay in the area for a while, I think it would make more sense.

Personally, I would go for the duplex/triplex/quad, learn the area, then be ready to pounce on an even better opportunity. You can probably move after a year (might have to coax the family a little) and keep your first property as an investment. Less risk, and very solid returns if you buy right.

BP experts,

I just received my tax assessments for 2013. Most seem fair, but one is 2.5X the appraisal value from my refinancing (about two months old now).

I disagree with the appraised value, but it could significantly reduce my tax bill for the year. Only problem is the county's appeals process requires you to submit your appeal by July (or within 60 days if you bought it since that date).

So my question is, can I/do I try to appeal at this point or wait until next year? It's not worth hiring someone (only talking about $500 or so), but it would be worth my time to process the appeal if I have a chance. Even one in a million...

Thanks.

David

Joshua,

I'm active duty as well. I'd love to be stationed in San Diego, but the RE market there is tough if you're looking for investment properties. The others have a lot more experience with VA loans (never had one myself).

Not sure if anyone knows, but can you use a VA loan to buy a HUD property? I know that's mixing two different programs, but I'm not sure the VA or HUD would care as long as you make the payments.

R/

David