All Forum Posts by: Michael Plante

The tenants moved out of our rental over 2 weeks ago, and I have not heard anything from property management about it, no is it listed on their website as available. I realize it takes a little time to clean, repair, etc., but if the PM knew their lease was up, why wouldn't they list it as available on a future date or at least notify us? We live next door, so we know no one has been there to clean, mow, etc. What is a reasonable expectation? We have planned for vacancy of course, but we would also like to see them working to get it rented in a timely matter. Am I being too crazy? TIA!!!

@Michael Plante home possible and home ready both do 3% down, but its a thin needle to thread through because they have income caps to qualify for it, which typically do not align with income minimums needed to meet DTI requirements. plus the rates and MI are so high right now on those, its kind of a moot loan product in today's market. not impossible, but very difficult.

If you have a good credit score and want a low downpayment, is the best option to go with a conventional mortgage? 

I was originally attracted to FHA loans due to the low down payments but it sounds like a conventional loan is the better offer if you have good credit. Is this always the case?

@Archer Stone

You had an inspector verify that mold was present and still proceeded with the transaction. You had the opportunity to back out of the deal but chose to move forward. At any point in the transaction did you speak with the neighbors or HOA about known issues? How can you prove the agent or seller knew about the mold that was not visible and behind walls?

It sounds like you used the listing agent as your agent as well. The listing agent will always have priority to the seller and not the buyer, even if they say otherwise. You should have retained your own agent IMO.

I would not have let a random buyer cut into my walls either. It's not your house at that point so you either back out of the deal or proceed knowing that there may be an issue down the line.

 I'm not trying to be the bad guy, but I'd check with a local real estate attorney and talk to the brokerage about your options. 

Look, a lender is going to make money on you, and that's fair.  They are supplying you with the ability to acquire an asset you'd never be able to afford on your own.  Truth is, your loan gets sold in the secondary market. These Hard Money Lenders are not sitting on your 30 year mortgage and collecting 360 payments from you.  That payment stream goes to investors.  The bank makes money on origination fees and points.  

ARMS are riskier, right? You are a slave to the rates. Where they go, you go. It's variable. That's why they cost less in points. We did a 7 year ARM at 1.5 points. To get the lowest possible rate at the bottom of the buy down chart in a 30 yr Fixed will cost you 4 - 5 points. So ARM deals are cheaper. Like I said, 6 - 8 months ago I was doing exactly 0 ARM deals because rates were in the 3s and all the smart investors bought all the way down on refis and purchases. Now, I see ARM deals come in. People betting on a better rate down the road. Willing to take a cheaper deal and refi out of the ARM later and hoping they win the bet and the rates are lower. Are they going to be right? I don't know. If I did I would tell you all the exact right thing to do.

It's all relative.  Right now the bottom rate on a hard money lender is high 5s.  We are 5.89 or so.  That seems high because we were just at 3.5 not too long ago.  But as others stated, there's been times where the rate was 10+, so 5.89 seems like you wanna jump all over it.

I am looking at buying a 5 plex in a very small town. It is about 15 min in between two other towns that have a population of 4000 and 8000. They are asking 100000 for it and it gross rents equal about 2250 a month. The owners are open to negotiation on the price. The problems with the unit is that there are several water leaks and it looks like the whole roof will need to be replaced and the total cost of that along with other repairs would be closer to 35000. If the unit was full fixed up, it would only be worth around 120000 probably so there is not much place for building equity into it. If i could get the price down to 70000 then i would be all in for around 110000, but even in future i don't see this place increasing in value much. It would cash flow though between 700 to 1000 per month. My question is, is it worth it to buy an older 5 plex that wont really increase in value in a small town but it will cash flow (at least it does right now) or because it will probably never gain much equity and will continue to need repairs, should i pass on it? 

Any thoughts are welcome.

The 30 year fixed was a no brainer 6 - 8 months ago. Rates were down in the 3s. Now, I see lots of people going for the ARM because they are gambling that in 5 - 7 years they can refi and get a lower rate anyhow.

It's a case by case basis. 9 times out of 10 I'd say the 30 year fixed is the way to go, but with interest rates on a rising trend right now, I do see the ARM deals coming in.

I called a local credit union(Fibre Federal CU) the representative that I talked to said that as long as the home was manufactured before 1976 and passed all inspections they would loan up to 95% of the LTV at somewhere between 6 and 7.5% up to 20 years.

Hi all, 

I got a fixer upper with all cash. The deal was good so couldn't pass on it. I plan to fix & flip it but I don't have enough funds to remodel it (the house needs extensive work costing around $70k easily). What're the best ways to get the capital for remodeling it? I own the house outright, no other investors or lenders are involved. Thank you!

 Well, What I would like to do is use it as a rental property. I think it has better potential as a rental unit than my current residence. I do appreciate the input and tomorrow I think I will make some phone calls to lenders.