All Forum Posts by: Micah Starbuck

My wife and I have 2 properties near Salt Lake City that cash flow well but are causing headaches.  Specifically we're having trouble getting support from our property manager to execute repairs and upgrades that the city is requiring.  We've tried contacting local companies directly but haven't been able to get much interest or response.  The problems are to the point where the city is starting to hit us with fines.

I believe we could sell the two properties and walk away with ~$75,000 that we would re-invest again locally and believe we could get better properties or more properties than what we have now but individually would probably not cash flow as well.

The question is, would you sell property that is cash flowing well but is problematic to buy more properties that individually wouldn't cash flow as well but you could manage yourself?

@Karen O.

I had thought about that but was hoping to only borrow as much as needed. That's pretty easy to do with the HELOC but harder to predict with a cash out refinance.

But the downsides of the HELOC are pretty significant so I may end up going with the cash out refinance anyway.

@Andrew Postell The reason for paying off the primary is mostly go gain access to the lower interest rate. I've been leaning towards a HELOC mostly because I don't want to over-borrow while leaving funds available for later use if necessary.

@Steve Vaughan I did see the Rescission section of the loan along with the 10 year draw period but maybe I didn't give them as much weight as I should have.  These are long term investments for me so I want to make sure I'm not opening myself up to too much risk.

Since I've gotten two messages back saying this is a questionable strategy  (and none saying, "Yeah, go for it!) I'll take a step back and do a bit more research on how best to access my equity.

Thanks all for the responses.

I'm looking to access equity in one of my rental properties to make another rental purchase.

As things stand now, I owe less than 50% of what it's worth with a 28 years left in a fixed rate 30-year loan.

Here's where I need feedback:

I can get a HELOC as a 2nd for Libor +5% or as a 1st for Libor +3.5%.

I was thinking to use the initial HELOC to pay off the primary mortgage then go back to the bank and ask to extend the HELOC to 80% LTV and reduce the interest rate to the lower rate since it would then be the 1st lien.

Any feedback (positive, negative or otherwise) would be appreciated.  Thanks!

So a little different post but my family and I will likely relocate from SLC UT to the Knoxville area this summer and we need a place to live.

We're looking for any recommendations for real estate agents or flippers with projects wrapping up around July/August.

We'd like to be outside of Knoxville but near shopping, schools, etc.

Thanks for any help or leads you might have!

While I appreciate (and will take into consideration) all the recommendations to skip the hard money loan, I'm still looking for information on whether I can do what was asked in the original post.

I can't make an informed decision without complete information and this particular nugget is at least interesting if not useful.

@Corey Spruill I was thinking purchase with hard money, refinance with 203k, (if possible) pay off hard money with 203k refinance.  It's that last part that I don't know if I can do or not.

@Wayne Brooks, point taken but if I can scratch $20k off the purchase price by making a cash offer I'll be into the property faster, for less money, and be in a position to get the 203k squared away without having an impatient seller chomping at the bit to get the deal done.  Assuming that I can pay off the hard money loan with the 203k refinance of course.

Hoping the well versed folks can answer what I hope is a simple question.

There's a very run down property where the price is higher than it should be for the situation and condition but I'm guessing a cash purchase could help drop the price.

We would want to do a 203k to renovate the house for us to live in.  

I know you can use the 203k to make a purchase/renovate and you can refinance property you already own into a 203k but could we draw equity with a 203k to pay back the hard money loan and pay for renovations?

Thanks

Thanks for the info and tips, @Steven Bond.

There's a couple of reason for starting with a property management company but the primary reason is I want to find a solid support network early in building my portfolio rather than try to pivot once I've hit my target number of properties.

I also travel a whole lot for my day job.  While I could probably manage 2 or 3 properties without a whole lot of trouble I'd rather pay someone who has those systems in place rather than run the risk of running off good tenants because I can't give them the attention they deserve.

You might be right though.  This whole plan might fail miserably but there's only one way to find out!

Just a quick follow up but Reeder reached out to me after my post apologizing for missing my email and sending me info on their services.  Glad they made contact and were quick to identify the issue along with the resolution.

I am a bit surprised that there haven't been any responses to my post.  Does no one in Ogden use property management or are they all so terrible that no one wants to discuss the subject?