All Forum Posts by: Mike Stillwater

I'm looking to research invest in an out of state Airbnb at a tourist location.  I've never done an Airbnb before and was wondering if anyone knows of a great guide I can read to help me choose the property and find the necessary property management.   It should be managed professionally just like our other rentals but I know there is more to it than a traditional rental and added costs plus different marketing.  

I'm also looking to use it as a place we can use for like a couple of weeks a year for our personal vacations.  (I'm not sure if that complicates things)  There looks to be properties available in our price range but I'm pretty new and am not sure how to analyze a property for an Airbnb using the bp tools or how to determine the income possibilities for a rental.  It seems I need a very good realtor who has experience with these rentals, but first I definitely want to fully understand everything I need to know.  

Thanks for the replies. A 3.5% loan is for an FHA as Tuna responded. I worked in the mortgage industry for some time and was fully aware of house hack options as I've done it twice but it won't be happening again as I just bought a new home that I won't be renting out. 20-25% down is customary for investment properties and more so on the 25%.

Tuna, 

I might have watched it but I will check again.   To be honest I already spoke to my agent about seller financing as he only works with investment buyers/sellers and he said it's very rare to get low down payment terms from seller financing.  He said in Michigan it's considered a land contract and most sellers want a strong down payment and a short term.  Considering how low inventory is right now my chances aren't the greatest in obtaining seller financing so low but it wouldn't hurt to ask.  I don't want to seller finance and not be able to refinance due to them requiring 25% equity also which would leave me still short.  That could put me in a dangerous situation where I wouldn't have enough funds to cover it depending on the purchase price.

Mike

 Austen,

Thank you for the great reply. For #1 where can you get 3.5% down? I've contacted several lenders and none of them had such a low down payment. Everyone I called required 20-25% and I have an excelent credit score and my DTI is low. If it could get low down payments it would solve my issues for now. It would be harder to get cash flow if they require PMI but if it was the right property I could make it work. The lenders were broker, and Non-QM portfolio lenders, my bank even did both conventional and portfolio lending. None offered low down payment for investment properties. #2 They are petty rare out here and are considered land contracts in Michigan. I'm also looking for multi-family rather than SFRs. With such limited inventory, these are very hard to find. #3 it wouldn't hurt to ask if they had a lot of equity to cover the costs it might still not be enough. Would all depend on the loan balance and the equity position left and the ability to get a loan on the remaining balance. It could get tricky and the second could have poor terms and I might not be able to find the deal because there are a lot of buyers out there with better offers. #4 Syndcation seems very complicated and I honestly know nothing about it though I keep reading a lot of the big investors use it. #5 No offense but this one made me laugh because you dont know my wife. I agreed with everything you said but she has valid points that I have no answer for. Shes worried that I'll have loans tied up on our property and if we want to move it wouldnt be possible without paying off the HELOC. Yes, over time I would pay it off but I dont think it would be quick enough to make her say OK. I'd rather find another way then have to add another issue to have to debate with her about.

Mike

Hi everyone.  Just some quick background on me, I'm a former investor who successfully house hacked 2 SFRs and cash flowed them for around 10 years.  I managed them myself and have a good agent who always found us good tenants that left our properties without vacancies for the time we owned them.  At the time I owned them I mainly used them as supplemental income and unfortunately didn't really see it as something I really wanted to expand on.  I've been successful with my career and I really didn't realize that I actually had a passion for investing in real estate.  To make a long story short my wife and I decided to sell them at the top of the market.  We used the money to purchase a better primary residence.  

It took me a year here at our new house to realize I wanted to start my own investing business.  After a lot of research and learning a lot of the things I didn't know about purchasing and managing the cash for the rentals I came up with my criteria and plan.  The frustration I ran into is I came up with a plan to use our large amount of equity in our primary as down payments for some rentals.  My wife ended up being completely against the idea and that left me with the inability to fund down payments and cash to close.  I've been spinning my wheels now for several weeks trying to come up with some way to come up with the money other than old fashion saving up which would take me several years.  Any advice would be greatly appreciated.  I've looking to buy multi-unit properties with the goal of buying apartments.

Sorry forgot the analysis.  Meters are separate and tenants will be paying utilities and lawn maintenance.  If I wanted I could keep it interest-only but I dont see much upside from it and on a buy and hold I dont want to sell it doesnt seem like the right move.

https://www.biggerpockets.com/...

Hi All,

This is my first post as a pro member. So glad I found this website. My agent has a 4 br duplex 2 units in a higher tax area but also a higher rent city. The good thing about the city is it has affordable multi-units to buy when they are available. I'm sharing my analysis on this property for opinions as I've owned SFR but this is my first mult so I would be great to hear opinions. This is a 100% financed property so the mortgage payment is there plus the $205 heloc. I have a $120k available in a 30 year amortized heloc with a 10 year draw, no fee except $60/yr. If I had the cash the cash flow would jump to over $500 but I'd rather not use cash at this point. The areas rent for a 2br 1ba is as high as $1500-1600 for a fully unit but I'm analyzing conservatively. The house needs a new roof and my offer would include a concession for $8500-9k for the roof. The house was overpriced and has been sitting for a while and they took it off and is going to relist it but I can still get it before its listed and anyone sees the updated listing. I personally wanted $500+ cash flow but I just dont have the cash to put down. Each unit is 2br 1ba.

Hi All,

I came across this thread while looking for information about getting conventional investment property loans under an LLC. I coincidentally just got off the phone with my broker and he said that in Michigan you cannot close in an LLC. Online I've not at all been able to confirm that is even true. If anyone has any resource links I can look at to prove or disprove it please share. Thanks!