All Forum Posts by: Matt N.

Hi All,

I have a buyer who purchased a property (prior to my time) in which the seller had 4 evictions in a 16 unit building going on. None of these evictions were ever disclosed to them during the purchase. They found out the day before closing that there were several evictions going on by the tenants. I am curious if this is only an ethical dilemma or if there might be legal action that could be had. And would the results change if the buyers did not find out the day before closing? 

Thanks!

Matt

I will only have 5% equity in it. Refinancing it (1) gets rid of the big mortgage insurance payment from FHA and (2). more importantly, allows me to purchase another property with an FHA loan. I wouldn't be able to purchase another property with an FHA loan if I did not refinance the current FHA loan. And since I purchase duplexes for cash flow, I don't mind paying PMI for being under 20% equity -- the main goal is to obtain properties with lowest down payment as possible that will cover the mortgage and expenses. I can't pay 20% down on a property and keep accumulating properties. I won't get into that as I'm more concerned with the lending aspect of it as discussed above and just overall strategy with the ARM. Does that clear it up?

Hey All - I have been shopping around with lenders and wanted to get some others' opinions on this. 

I have a duplex with an FHA loan (around 5% equity right now). I've lived there for about 9 months. My goal is to purchase another property to live and I found a lender who will finance total costs at 5% if it is owner occupied (so would not have to get another FHA). But I could not do this unless I refinanced my current property.

The lender has recommended to me to refinance the FHA to an ARM that has a locked rate for 10 years (interest rate is around 4.4%). The interest rate will then fluctuate after 10 years based on the economy BUT it is capped at 2% rise per year. The only requirement is that I have 5% equity in the property. I was thinking I would refinance to the ARM, get rid of the mortgage insurance with FHA on this loan, then be able to purchase another property slightly bigger (duplex) to live in for 5% down with her program (and sell my current property within 10 years so I don't get hit with any inflation interest rates). I was curious if anyone had any opinions on this or things to ask the lender so I do not screw myself.

THANKS!

Hi, I have a scenario I am hoping someone can assist me with for mileage deductions.

I live at Property A. I work at Corporation B (primary job and unrelated to real estate). All my mileage is typically showing clients properties (real estate agent and secondary job). I go from Corporation B to property often and have been keeping track of that as I believe there are no issues with that. My main question is going from my property I live at to a property to show a client the property. I do this as well and usually only show properties a few times a week. Would the home to a property count since the property is not my business and is merely me showing a client a property -- part of my secondary job and what I would think would be a temporary location since we likely won't ever visit it again.

I was also told to include mileage on schedule C as part of my income... I wasn't sure what was meant there. What specifically would be included on the schedule C and why would someone advocate for that?

Disclosure: I will hire an accountant before tax season -- just trying to stay ahead of curve in tracking my miles. 

Thanks so much, Steven. So, for example, driving from my primary place of work to a property to show it to a client would be ok and I could record those miles. So would driving from the property to my home (since the property is not my principal place of business). I assume that would be designated as a "temporary work location" if anything. Or would it be considered a second job? 

For the sake of argument, since my primary work place is where I work 8-5, couldn't I log the mileage for every single trip from my job to property viewings, closings, etc., and back home since these real estate deals aren't my primary job/I don't have a place of business as a real estate agent (belong to a brokerage but have never shown up there) and are temporary in nature (e.g., my client gets into a contract, I show him property, show up for inspection, closing, etc. -- that is only going to last 45 days max usually so I would assume all trips to the property and even from the property to my place of residence would qualify as mileage under the temporary work selection.) I know the trip from property to place of residence is a little more blurry but I am just looking for an argument for and against. Would appreciate any further guidance you might be able to give, Steven.

As to your question 1: 1. Yes, you can and I would include it on your schedule C as it was part of your income... I wasn't sure what you meant here. What specifically are you saying would be included on the schedule C and why would you advocate for that? 

Hi All,

This is my first year recording my mileage. I am a real estate agent and work full-time as an attorney for a corporation. Accordingly, I only spend a small percentage of my year working as an agent v. attorney; however, I do have several clients and deals. My question is twofold: 

1) Can I write off mileage for a property that I purchased for MYSELF as a rental property in which I do not live? I was the acting agent on the property and took a commission on the property but, again, I purchased this for myself.

2) I routinely go from home to work (actual job) and then from work to either one of my properties as a property manager or to meet one of my clients to look at properties, etc. I should have no problem reporting the mileage from my unrelated job home base to the properties I meet my client at, correct? What about from my home to a property that I meet my clients at, considering I usually only drive from my home to one of these properties during the weekend or after my normal 8-5 job work hours. I am having some trouble with this due to the fact that my actual job is my actual job and anytime I drive from my house to a client I am going to look at a property with them. 

As for the property management aspect of it, I can report mileage from my home to that property, correct? 

Thanks so much for any help!

Cheers!

Hi All,

I am an attorney in Missouri and have a few properties I assist a client with. I was hoping to network with any attorneys or people who have gone through the whole eviction process. 

Generally, I would like to know more information on the process so I can take it on myself. If anyone has any sites they think are particularly good or contacts, I would greatly appreciate your help! 

-Matt 

Thanks so much for the amortization schedule. Exactly what I was looking for.

I full intend to bank cashflow after the 20% (PMI is gone). You would bank that cashflow even before the 20% equity and pay the PMI? I still have the remaining question on number 1 - how the refinances work with the FHA. Any thoughts on this? I want to make sure I am not putting myself in a position to refinance the loan twice (first to convert it from FHA to conventional when I move out to the next one, and 2nd when I hit the 20% equity mark). I am not sure if PMI just drops off at 20% or if you must refinance.

Hi all - I am closing on my first rental property this month; a duplex with FHA financing. It is $170k with a 3.5% down payment. It brings in $2000 a month in rent, which I will only be getting $1000 a month for the first year since I am occupying. Will get a lenders credit to do away with the initial FHA fee tacked on at closing, and will be financed at 4%. I plan on refinancing in a little over one year to a conventional mortgage and repeating the process; however, I am unsure on two items, and really hoping someone can assist:

1) I am not familiar with how the interest to mortgage payments are worked out. I am under the impression that the first couple years will be almost entirely interest payments on the loan. Accordingly, I doubt I will have anywhere close to 20% equity at the end of the first year and a half through applying the rent to the mortgage and interest. Question 1: Can I refinance after a year from FHA to conventional even if I do not have 20% equity in the property? And if so, would I have to refinance AGAIN if I wanted to get rid of PMI when I hit 20% equity or does that automatically get taken off?

2) I have a very good understanding of rental income after expenses and what my annual cashflow would look like, calculating generous expenses in. However, I am having a difficult time determining how much equity I will actually be gaining, which is one of the main attractions for me as a 27 year old and going the FHA route.

The numbers:

If I am bringing in $2000 a month in rent for 10 years, and expenses end up being $1700 total, for a $300 cash flow, I would like to have a general idea of how much equity I will have built up. 

Assuming that I make the $800 mortgage payment a month, and apply the $300 in cashflow to that payment as well for a total of $1100 a month going toward the loan amount, could anyone give me a general idea of how much equity I would have in the property after 10 years or 20 years? Let's assume no property appreciation or annual increase of rent or expenses. The calculator seems to not factor in everything I want for purposes of equity (e.g., accounting for interest up front, and how much you are applying to the loan amount). 

Thanks so much for any thoughts!