All Forum Posts by: Mark Dutton

Well, $1,300 cash flow would be across 3 rental properties with about 500k leveraged. 400k would be for my primary home TOTALLY my total debt is 900k. All of the properties are in good condition to my knowledge and I don't see any big foreseeable expenses for at least the next 5-7 years. 

The sales position is purely commission-based and 1099-related so I have to pay for all of my expenses that otherwise a W2 employee would get which also unfortunately STINKS. 

That is also one of the ideas that I have is selling one of the properties (Townhouse I bought from DR Horton) but I rented it out to a friend and hate to sell it with them in it. Hence you should never do business with a friend. The townhouse currently rents out for $1850 while my mortgage/HOA payment is roughly $1600.

I will say I have learned my lesson on a few properties before the ones I have now. I have already sold one because it was such a terrible investment but I got out of it quickly and didn't lose much money. It was a good learning experience so I can't be to mad at myself.

I appreciate all the help and everyone commenting their opinions on this. I will honestly say it is very helpful and I am taking in everything everyone says. 

@Pat Aboukhaled

Thank you for the information!

I feel like I’m stuck between two goals: wanting to grow my portfolio and wanting to pay down my debt. I understand that rental properties are a long-term investment, but it can be tough to keep pouring money into them without ever seeing any of it in my own pocket.

I’ve invested over $260K into these houses (not including the 20% I’ll need for my next property), and I haven’t seen any return yet. That’s what makes it discouraging at times—putting in so much without seeing any of the money come back to me.

@Pat Aboukhaled

Thank you! Can I ask at what point would you start paying down the loans if at all?

@Chris Seveney

Hey Chris. I currently have around 40k in reserves for my rentals and 125k for personal.

They are cash flowing about 1300 a month and I have around 25-35% of equity in each property.

Hey everyone, I’m a novice investor and I’d appreciate some advice or insight on my situation, even though I know everyone’s circumstances are different.

I’m currently 27 and will soon have three rental properties along with my primary residence. Once I close on my next house, I’ll have about $900K in debt. To be honest, this feels overwhelming, especially knowing I couldn’t pay it all off quickly if I had to.

Out of that $900K, about $500K is tied to 30-year mortgages on my rentals, with interest rates ranging from 2.99% to 4.375% and 400k on primary at 6% 30 year.My total monthly mortgage payments are $5,500 on my rentals, and my long-term rental income is $6,850, giving me a monthly surplus of about $1,300. I’ve been saving that extra income for future property expenses or emergencies, so I don’t have to dip into my personal funds.

I also earn around $130-150K annually from my sales job, though sometimes I feel anxious about whether I deserve this income or worry about losing my job. Despite the income, I still feel like I’m over-leveraged.

Has anyone else felt this way as a beginner investor? How did you manage these feelings or concerns about being over-leveraged?

Is there a general number you should make in cash flow, like a percentage? I am not really focusing on the brrr method instead I am just looking to buy properties to rent them out without looking my tail on them.

What percentage do you want to put towards emergency funds and how much would you want in cash flow.

Of course all of this is on top of the common expenses such as the PITI.

Is there a general rule of thumb for leveraging? How do you know when you have to much?

How much money should you have per house in an emergency fund before you can start taking money from the cash flow? Is there a rule of thumb because I know it will change based on the price, location, etc.

Are turn keys worth buying? I hear a lot of people buy houses that they can rehab and it makes more since but to just get houses under your belt, what would you do?

@Derrick Dill okay cool! Thank you. Do you think the age of a property matters at all? Should I focus on new construction or some house built in the 1950’s?