All Forum Posts by: Michael Paling

I have to respectfully disagree with Kimberly, because I've chatted with a local lender that will do 5% downpayments on conventional loans for duplexes (if owner occupied). I've also chatted with other local lender who said exactly as Kimberly did though, so just make sure you're talking to a bunch of lenders, because they all may tell you something different. 

welcome Orlando! This is an awesome community that's extremely helpful. Consume as much of the content from BP as you're able, because over time, it will all stick. As for finding a mentor, search out investors at local meetups. They'll be able to help you in more specific ways than any of us, because they'll know your local market better. I also wouldn't suggest asking "will you be my mentor", but instead try to make genuine friends with these other investors and ask them specific questions about your situations. Over time, you can show them through your actions and questions that you're serious about all this and they'll be happy to help you. Not every person will have the capacity to act as a mentor too, so keep that in mind and just keep making great relationships. 

Listen to everything @Nathan Gesner said. He did a great job of providing good step by step points and I really enjoy learning from all his advice he posts. Another resource that I have to give credit to personally is Mr. Money Mustache. That's where I started realizing all the stupid things I was doing with money and how I could start saving a lot more. If you haven't yet, it may be useful to open a credit card account so that you can start building credit. Just make sure that you're paying that card off every month and not using it for more than you bring in each month.

I've been using wealthfront for many years now. I started with a Roth IRA and now have a savings with them too. I find their platform very user friendly and for those that have no clue about how to pick stocks, funds, ETF's, etc., Wealthfront is a great robo advisor. I'm happy to refer anyone as well.

@Rick Albert so are you saying that ideally, I should be looking for places with the same number of bathrooms as there are bedrooms (2/2, 3/3, etc)? I think that'd be pretty darn hard in my area, but something I'll keep in mind. 

@Lawrence Potts Good points. I'll be passing on this property, but for the sake of education, can you expand a little? If the tenant is renting out that upstairs bedroom in the listing (the one with two twin beds) while I'd use that loft area with the desk as my room, are you saying that the potential issue here would be that the tenant would have to go through my room to get to theirs or that I'd have to walk past their room to get to mine? Or that the two rooms are just not separated/walled off enough?

Hey other investing minded folks! I’m looking for properties that I could potentially house hack by renting extra rooms and I checked out a property earlier today that I’m interested in some feedback. Here’s a link:

https://www.zillow.com/homedet...

The property is marketed as a 3 bedroom, but the third “bedroom” is more of an extra space at the top of the stairs. My thoughts with this is that I could potentially claim that space for myself while renting the other two bedrooms, but it’s just a little odd with the access to the upper bedroom going through that area. I wouldn’t mind, but I’m curious if anyone here has done something similar. How much of a deterrence do you think this would be to potential tenants? 

There’s plenty of work needed to fix this place up, so I’d intend this to be my primary long term with probably adding an extra bed/bath over time in the unfinished areas. 

It sounds like you need to really dig into educating yourself first, which you're starting to do by reaching out here. Keep reading and asking questions. Are you sure you mean "hard money" or do you really just mean "private lending". Hard money lenders are in the business of lending money. Private money lenders are people like friends or family who aren't in the business of lending but want to invest in real estate to get a better return than stocks.

If your friend has a great track record, then it could be smart to invest with him. But if you can't verify all the information he's giving you, how do you know if he's not blowing smoke? Find some other local investors, join a local meetup group, and keep learning before pulling any triggers. 

Talking with several realtors shouldn't be a problem and if you tell them up front that you're not settling on any one realtor yet, most would be understanding of that. Just make sure you've got your questions ready up front so you can be straight to the point. 

Although... I like Nicholas' point. For your first deal, finding the best realtor isn't as important as getting your first deal done. So find a realtor that you like working with and is willing to help answer all your newbie questions. If you decide to change realtors after the first deal, then that's part of the business. You'll just be much further ahead than if you don't have your first deal and stressing about finding the perfect realtor. 

This can be a great idea. Purchase a multi-family, rent out the additional units, and fix up the one you're going to be living in while you're living there. As the tenants move out, you move into their unit and fix that up. Over time, you'll have the whole thing updated. 

Or you can plan to rehab the whole property over a couple months after purchasing to have it completely updated and then charge top rents for all units. 

either way, both BRRR and house hack are great strategies whether used together or separately.

Quote from @Jane Ho:

Quote from @Michael Paling:

Quote from @Jane Ho:

Quote from @Michael Paling:

I'm sure that my advice will vary depending on everyone's location but give your Housing Authority a call. I purchased my first property last year and inherited a section 8 tenant and I've had many questions. The HA has been helpful in answering my questions, but I understand that not everyone has the same luck. Make friends with the local HA and I'm sure you'll be setting yourself up for success with section 8. Just make sure you screen tenants heavily. 

 Thank you!!! But what else I shall look at if they are section 8? I mean their income will be low, their job won’t be fancy, their credit score won’t be good…how to heavily screen them? Thank you so much!!! 

Screen them just like any other tenant but consider the housing voucher as part of their income, or don't screen based on income. Maybe I'm wrong on this part, but why would you screen someone on what type of job they have? So long as they aren't a dirty person, and they're not going to damage my property because of it, I don't care what their job is. If they're a dirty person, you'll know when you meet them. I've heard some people suggest meeting potential tenants at their current residence to see how they treat the property which will tell you how they'll treat yours. As for the credit score, determine what your minimum credit score will be for screening any tenant and stick with that. You'll probably have to turn many away because of this, this should be a standard screening point across all applicants. 

THANK YOU!!!! I sometimes care about their job because I don’t want them to claim that they are not employed but they are growing pots in the house 😂

Haha that’s a great point. I’d thought about mentioning “as long as they’re not drug dealers too” so I’d consider that a deal breaker too. But that’s probably an abnormality.