All Forum Posts by: Mikhail Abbott

@Steve Smith sorry should have been more clear

The $2237 is the difference of annual cashflow

Currently I am making 225/month or 2700/yr

3.5% 30 yr cash to close $5670 cash out $37k

With the cash out refy. (No points) would reduce my cash flow to 38/month or 456/yr

Cash out refy with a rate buy down to 3.375%

Closing cost with points $6741

Cashflow 49/month or 588/yr

Cash out refy with rate buy down to 3.125%

Closing cost with points $7163

Cashflow $73/mo or $876/yr

Closing cost seem on the high side but have a couple more quotes coming in.

Okay great. Thanks for the response. This definitely lines up with my goals. 

So I am looking at pulling some equity out of my rental house in texas and purchasing another rental

So this property brings in $225/mo of cash flow on top of saving 15% ($279/mo) for vacancy, repairs and capital expenditures. I self manage for now.

I got a quote to do a cash out refy and pull out roughly 37k but it increases my mortgage payment thus reducing my cash flow to $38/mo. With total closing costs and paying off the loan balance on an air conditioner that leaves me around $30k.

The difference in cashflow between the two is $187 a month or roughly $2237 annually

My question is, if I can use that 30k to purchase another property that brings in at least the same annual return, is it worth to run my profits that low on the initial investment?

The 30k would possibly sit for a few months until I save up some more and find the next property

Anyways would love to here what you guys think. I’m leaning toward doing it but not sure if thats too risky with the current market/economy etc

Thanks,

Mikhail

@Adriel Hsu try hurst lending in DFW. Im doing a cash out refy with them at 3.5% 75% ltv

@Jim K.

Id start investing in all these rich Nigerian princes that keep send me emails!

@Brandon Turner

From how I understand it at least in my area (Greater tacoma area) , if you are grandfathered in as a non conforming multi family then operate as you normally would but if you let the property sit vacant for a period of time (I think its a year) then it would revert to the current bylaws/zoning. I believe by keeping the utilities turned on is a loop hole. But im not an attorney, only a real estate professional! Haha

Yeah I think I was getting a head of my self with going out of state. I think I understand how that structure works and not sure I would need it. I was thinking I would need to have a manager managed Wyoming/Nevada LLC that owns a member managed Texas LLC that holds the property. I thought I needed this to achieve anonymity.

Ronald

It’s just my wife and I so one member. 

Michael 

I think your correct. I think I miss heard him or misunderstood. 

So I have an attorney starting the LLC for me and asked to consult with a CPA on how to be classified under texas law. As a partnership or an association.

I haven’t been able to get a hold of any cpa’s due to tax time and everyone the responds back saying they aren’t taking new clients at the moment. Im a little confused, when the lawyer says classified as an association, is that the same thing as a disregarded entity in texas? 

Ya i agree, its added benefit at half the cost. We are gonna expand the patio with pavers, using my contractor and split the cost. Opted to bot do a patio cover. I think she’s gonna buy a large cantilevered umbrella to help block out the sun. The back yard is west facing so gets hit hard with afternoon sun. 

The property is in Tx. dfw to be more exact. Okay ya all good points. Have a quote to extend the patio 2 ft on 3 sides with conrete for $620 including materials and labor. If i bordered the slab with pavers it might be a bit cheaper. 

She was asking about one of those patio covers from costco that are about $1500. I also received a quote to build one and it'd be pretty similar cost. It would be cheaper for an pergola. 

I think I will expand the patio and not do the patio cover but allow her to put a detached structure up at her cost. 

Thanks for all the input