All Forum Posts by: Matthew Kwan

You can do DSCR loans or Hard money loans, where they only focus on how well the subject property performs in terms of the rental aspects or the ARV aka after repair value. Of course, the rate can be slightly steeper than the conventional loans where it is a full document loan, where they need to qualify you based on your income.

Alternative way, is to acquire the 2nd property as an investment property with conventional, while putting 15%-25% down payment. Down payment can be higher than primary, but the good thing is that you won't need that much income to qualify because lenders can you 75% of the market rents for the units of the property. Imagine the 2nd property is a 4plex, each unit can be rented $1500/unit of 75% =$1125 x 4 units =$4500 worth of income to offset your that 2nd property.

@Albert Bui @Carlos Valencia

HI Shai,
It really comes down to what your long term goal on investing real estate. You want to invest just to have a place to live and potentially offsetting your mortgage payment by renting out the vacated rooms or having x amount of cashflow in the future? Looking into single family houses or multifamily, as there is an actual land that you own and potentially build ADU/DADU in the foreseeable future. However, if you build the ADU and not condomise it, they appraisal will only view it as a SFR and give you the rent as SFR at 75% if lease agreements is being used. If you want to maximize your max rents then if might be a good idea to condomise it so that you can get rents as two separate units. Since last year of November, Fannie and Freddie has allowed borrowers to put min 5% down for conventional loans and being able to invest multifamily up to 4units.
Also, the beauty of FHA is that it allows you to put 3.5% down payment to invest in 1-4 units. However if you plan on buying 3-4units, there is a trigger rule for FHA, it is called the self sufficiency test. In order to past this SS test, your appraised market gross rental income at 75% has to be more/equal to your monthly mortgage payment (PITIA). These are something to be considered. Feel free to DM and we can talk more about it @Carlos Valencia @Albert Bui

You definitely can Alex, you can even use conventional loan and entity can be under a LLC and acquire an investment property.

@@Albert Bui @Carlos Valencia

Typically lenders would wants it to be vested in your personal name if you were buying a primary house. If you wanted to invest through an LLC it would require you to purchase it as an investment property from 15%-25% down payment. There are some people who would buy it under their personal name first as a primary, and would switch it to another entity like LLC, however there's a risk in place where the lender can call off the loan and make them pay it off. (acceleration clause)

@Carlos Valencia @Albert Bui 

If you do HML or cash out refinance, they would still require to be 1st position. However, HELOC allows it be in 2nd position and your 1st mortgage with 2.99% remains as first position. The question is what are you trying to use these funds? What's your main objective that you are trying to achieve?

@Carlos Valencia @Albert Bui

HI Nicole, 

You can always open a line of credit for the property, since this will be your primary you'll be able to get up to 90% LTV if needed. The other method is do a straight cash out refinance up to 80% where you can use it for renovation and allocation the remaining funds to invest.

@Albert Bui @Carlos Valencia

HI Brook
You can always start off on house hacking a multifamily in MI 1-4 units with min 5% down or 3.5% down for FHA. This will allow you to acquire more rental units and also being able to use the vacated unit rents at 75% to help your debt to income ratio DTI.
There is a FHA 100 mile rule if you do plan on using FHA on your 2nd house hack. The fha 100 mile rule will be triggered whenever you try to vacate your current primary and also trying to use the rental income to qualify.

However, this 100 mile rule can be exempted for the following rules

1. Relocation
2. Increase in family size
3. Vacating a joint owned property
4. Non-occupying co-borrower

If you are not trying to use FHA on your 2nd househack, you can use conventional and the rules that I mentioned above will not be a concern.

@Carlos Valencia @Albert Bui

HI Zeek,

The good thing about investing in the US is that you can have a fixed loan rate for 30years which is not common in SE Asia or other countries. You can always start off by house hacking meaning you live in one UNIT or ROOM and renting out the other vacant units/rooms to offset your monthly mortgage payment. Also, the good thing about primary is that it only requires you to put as little as 3.5%-5% for properties up to 1-4 unit or 0% if you are a VA.

There are several ways to run and make sure you are maximizing your rental income while keeping your living expense as low as possible. Try looking into zillow/Redfin and see what your potential rents you can get near the neighborhood by filtering the bedrooms/bathrooms of the intentional property that you are planning to buy. This will allow you give a reference point on how much potential rent you can receive. (Max vacated rents - your monthly mortgage payment) = +/- net cashflow. 

If you are looking to be a foreign investor, I would recommend you looking into Singapore/Vancouver, Canada. There are some good incentives for US citizens to invest in Singapore. As for real estates in Canada, they are currently banning all foreigners to buy real estates in Canada until 2027. Also, there will be a 20% stamp duty tax that imposes on all foreigner investors. However, there is definitely a huge potential especially Vancouver, CA 

Happy to connect and assist you in your real estate investing journey.

@Albert Bui @Carlos Valencia

Hi
happy to hear that you're hunting your first house hack! There are several ways to run and make sure you are maximizing your rental income while keeping your living expense as low as possible. Try looking into zillow/Redfin and see what your potential rents you can get near the neighborhood by filtering the bedrooms/bathrooms of the intentional property that you are planning to buy. This will allow you give a reference point on how much potential rent you can receive. (Max vacated rents - your monthly mortgage payment) = +/- net cashflow. Happy to connect and assist you in your real estate investing journey. @Albert Bui @Carlos Valencia

If you are planning to buy a rental property while renting an apartment, lenders will have to count both of it as a liability. Typically investment properties requires 15%-25% down payment depending if it's a single family or multifamily. However, if you put it as a primary residence house, the only liability you will be counted towards is the monthly mortgage payment of the house and removing your rent expenses (since you moved out). The benefits of buying a primary or first time homebuyers is that rates are typically lower than investments because the governments incentives to buy houses even for 2-4units now as min as 5%.

On the other hand, you can repeat the process every year through house hacking and rent out your current primary house by converting it as a rental and acquire another property. I'll be happy to connect if you have any questions or concerns. Wishing you all the best on your Real Estate Journey!

@Albert Bui @Carlos Valencia