All Forum Posts by: Michael Vu

I'm a newbie grinding to make that first purchase in the next 3-5 months, and absorbing as much information through books, podcasts, and blog posts the past few months. I feel like I have hit a point of information overload and need some help with steps / questions to push past this road block and take action!

I've come across 3 properties listed and haven't been able to do anything because I don't have my systems in place and they sold in 24 hours. I'm ready to take action, but I want to make sure these are the right steps. I'm looking to purchase a multi-family to house hack.

Get Pre-approved for mortgage from 3-5 lenders
Contact real estate agent
Look for deals and make offers

I'm trying to map out my plan of attack and I want to make sure this is the best order or should I contact real estate agent first?

Here are some unanswered questions that I've been thinking about and holding me back:

I have enough saved to put down 20% down. Should I still do a FHA or should I go conventional? I'd like to buy a second investment property 6-12 months after my first.
When calculating for 1-2% rule/50% rule for house hacking, do you consider the side of the house you are living in the calculation or only the one being rented out?
In this BiggerPockets blog post, https://www.biggerpockets.com/blog/2015/03/25/fha-financed-duplex-ideal-first-investment-property/, Brett Lee talked about how you need to wait 3 years before you can get a second loan after FHA loan due to showing two years of landlord experience. I'm confused about this and can't find any more information on this else where.
Should I get pre-qualified first or do pre-approvals and is 3-5 too many credit checks?

I know that is a lot of questions to ask you all at once, so whatever you all can help with I'll appreciate very much! I think I know what I need to do, I just need that little assurance and kick to get me going. Thank you!

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Interested to hear any testimonies or opinions on using Ally Bank Home Loans for a conventional loan.

I use Ally Bank for checking and savings accounts and I have had a great experience with them so far. I'm in the process of searching for 3-5 lenders to compare rates and get pre-approvals for my first home purchase. It looks like right now, Ally Bank is offering 3.875% rate as well as rate matching with any better offers from another lender.

I still plan on getting quotes from other national banks and local credit unions, but given the fact that I do all my banking with Ally, I figured I may look into getting a mortgage from them as well.

Appreciate any feedback!

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Very interesting read, nice job putting this together. Looks like it is time to get in on the multi families!

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Great job on the first one! I just started looking into real estate investing in April and would like to get my first deal done before September as well! This is encouraging and will motivate me to kick it up into high gear this summer!

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Originally posted by @Michael Ealy:

Originally posted by @Adrienne Markes:

California girl here. I'm in the early stages of exploring mid-west areas to buy SFR or 2-4 multi family. I've heard there is a lot of opportunity in Cincy and Dayton areas. I've never been to OH, or many most mid-west states for that matter. I see SFR on MLS for $50-75k, what is the rental market like? Any property manager recommendations in the area? I'm open for any wisdom you care to share about this area or any others with great opportunities. Thanks!

Don't go to Cincinnati. I don't like another California buyer increasing property prices here :)

Just kidding...or am I? (LOL)

A significant portion of the 1,000 apartment units I've acquired are in the Cincinnati area.

Job growth is strong, property values are cheap compared to rents, taxes are relatively low (compared to Chicago for example) and there are many parts of Cincinnati where the government is spending on redevelopment, so I can't complain.

I am biased towards multi family though. Like this 48-unit I acquired and sold 6 years later and made over $1M profit on:

https://www.biggerpockets.com/forums/311/topics/644570-how-i-made-over-1-million-on-1-deal-after-6-years-of-headaches

If you want to play a "Bigger" game than houses, let me know and I can help.

Michael, with your experience in Cincinnati, what is considered a good price cash flow MFH? Especially for house hacking?

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Originally posted by @Michael Albaum:

Hey Simon, I don't know the area in West Hartford, but you should spend as much or as little as you feel comfortable spending. No one here knows your financial situation like you do. You should reverse engineer what you feel comfortable/can afford to pay on a monthly basis based on all the monthly expenses, i.e. a typical duplex (these numbers are totally made up for the sake of discussion) $100/mo in utilities, $200/mo in cap ex, $100/mo for insurance, $250/mo for taxes = $650/mo before a mortgage and property management. Since you'll probably want to cashflow at least $200/mo, you'll need to find a duplex that rents for at least $1500, which leaves ~ $500 for your mortgage payment and $150 for property management (10% of rent collected). With a 20% down payment, this would allow you to buy something for ~ $135K.

You can also simply look at how much cash you have for a down payment and since you typically need to put 20% down for traditional financing, that also defines what you can afford to buy.

Hope this helps.

Hey Michael, I'm in a similar boat to Simon looking to get my first duplex to house hack. What if the average rent in the area where you want to buy a rental property is only $1,000 - $1,200? How can you make it work so that you can still cash flow or break even?

1 Vote

Originally posted by @Raymond Reyes:

@Michael Vu hey Michael, I'm a realtor based out of NY but recently purchased a rental in the lehigh valley area (Allentown), if you ever want to talk shop feel free to reach out. Best of luck!

Will reach out, Raymond! Thank you!

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Originally posted by @Dmitriy Fomichenko:

@Michael Vu

Welcome to the BP family! Good to have you here! Here are some recommendations for you:

Find and connect with other BP members that are in your area: https://www.biggerpockets.com/search/users

Set up keyword alerts to be notified of the topics that interest you: http://www.biggerpockets.com/alerts

Read Beginner’s Guide: http://www.biggerpockets.com/real-estate-investing

Check out BP Podcasts: https://www.biggerpockets.com/podcast

If you wish to tag someone in the conversation on the forum, type @ followed by their name and then select the name of that person which should appear below the comments box. He or she will be notified of being tagged so that the conversation will continue.

Wishing you the best!

Thanks Dmitriy! Appreciate the starter pack!

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Greetings Bigger Pockets Community! :)

My name is Michael and I am planning on making my first purchase in 2019. My mom has always been pushing me to buy rental units after I graduated college. A few years later, I've only recently started reading books and listening to podcasts on rental properties and I've decided maybe she's right! I am still absorbing as much knowledge as I can and starting to analyze deals.

I live in Cincinnati, OH and I'm looking to house hack with a multiunit property in the area (Norwood, Oakley, Hyde Park, Pleasant Ridge) and hopefully exponentially expand from there. I went to college in Bethlehem, PA so I am also very much interested in rental properties in the Bethlehem/Lehigh Valley area. I'd love to hear from anyone who has invested in these areas!

I'm hoping to continue learning as much as I can, and then DOING something with that knowledge! Can't wait to spend more time in this community and meet many new people from different walks of life working towards similar goals.

3 Votes

All Forum Posts by: Michael Vu

Michael Vu has started 7 posts and replied 59 times.

Post: New Investor Information Overload / Mental Road Block

Post: Has anyone used Ally Bank Home Loans?

Post: Things are looking really good for multi-family investing!

Post: First investment property

Post: What info can you share about Cincy/Dayton OH market

Post: How much should I spend on my 1st duplex?

Post: Newbie From Cincinnati, OH Looking To Get Started!

Post: Newbie From Cincinnati, OH Looking To Get Started!

Post: Newbie From Cincinnati, OH Looking To Get Started!