All Forum Posts by: Matt Leonard

Rent Control can totally be debated - but the effort to repeal Costa Hawkins is really a different argument. Should local communities/cities be able to have the right to determine their own housing policies, what protections they offer their residents, and what works best in their specific economic, housing, political, cultural, and social context? I think they should.

Now, what actual housing policies each city should pursue - that's a rich debate, no doubt. But Costa Hawkins only exists to prohibit that discussion from even happening, by giving cities (almost) no say in such policies.

-Matt

Some of us are actually getting out ahead of this in another way - by helping pass the measure that will give cities and communities their own say in how to address this issue (rather than having a blanket state-wide approach that takes that power and authority away from local governments who might do more to keep people in their homes, and off the streets).

https://www.propertyownersforfairhousing.org/

Good question - no points. It's through First Republic Bank's Eagle Loan Community program - not offered in all geographies. I was rather surprised by the rate - I wasn't looking to refi, and also figured it was a little too good to be true. But I just got disclosure docs, rate is real, and lender pay all closing costs (other than prepaids, taxes etc). 

This makes sense to me - but would love anyone else's feedback. Thanks in advance!

I am in process to cash-out refi my primary ($850k value, $240k owed, 3 years in on a 30-year fixed at 3.75%) - at a 30yr fixed at 3.4%.  Hard to beat a rate like that in 2018.

I have an investment property ($260k value, $105k owed) - on a 3% ARM - (4 years in) and 3 years left before it resets. One can safely predict that rate is going to go up on the reset - 5% to start, and then likely higher each reset annually.

I'm debating about pulling more cash out of the refi to pay down (or potentially off) the investment property. While my overall debt won't change - I can consolidate it all at a much better rate long-term, and increase monthly cash-flow.

Of course, the terms lengthen (to a new, full 30 year) - but I can comfortably pay the difference towards principal-pay down so that the interest over life of the loan comes down. But this scenario also gives me the flexibility to not have to do that in an financial emergency, or sock away more cash flow towards the next investment.

Any pitfalls I am missing here? I realize leveraging your primary is usually not advised - but I have plenty of equity even in a 50% market crash, and am in a strong market (SF Bay Area)

Appreciate any advice!

-Matt

I'm in the middle of a fixed Home Equity Loan with PenFed, and same story. Coming up on month 3 and nothing but horrible communication, lost paperwork, asking for the same previously-submitted paperwork multiple times, missed target dates etc. I have literally returned every requested document same-day, and there's nothing unusual or complicated about the loan. Well under any LTV or DTI issues, no unusual title, drive-by appraisal only etc.

I have an existing HELOC with them, and a previous fixed HEL that I paid off last year - so you think a relationship or history might help.

Their rates are great, but definitely factor in poor communication, and a looooong closing time with PenFed.

Anyone have ideas for a lender who will do a Home Equity Loan (prefer fixed) on an investment property that is owned outright? (no first position mortgage). In California.

I would pursue a cash-out refi, but only looking for ~$50,000, which is below many lenders minimums, or have such high costs that I'd like to avoid given the principal amount. And it's a non-warrantable condo (due to owner-occupant ratios).

Basically trying to pull cash out of this unit to purchase another.

-Matt

I've started into this world with a condo in North Highlands. I thought long and hard of all the pitfalls I had been warned about, but made the plunge, and been very happy. Cash-flow, not a lot of work, no regrets, and learned a lot.

The big things I've learned:

Depends a lot on the HOA. Not just looking at HOA rules on renters, but also thinking about how the HOA may change in years and if it will remain rental-friendly. And - if you are paying $400+ (for amenities like clubhouses/pools) rental income may not make up for those costs. I have a small HOA (under $200) - and that goes towards basics like roofs, siding, landscaping etc. Those are essential things I'm not worrying about (which is both time and money).

Insurance is dirt cheap since you are just doing studs-in policy. I pay like $30/month

I got lucky on a turnkey spot that had a long-term tenant who is only there part-time so wear-and-tear/maintenance is minimal. But between HOA covering big stuff, insurance being less, and taxes generally lower than a comparable SFH - I think the HOA costs are not always the money pit people make them out to be. But again, it depends on the unit and association.

Exit plans are key too. I knew this going in - but because this is non-warrantable (due to OO ratios), it makes financing difficult - not just for you, but also whenever you decide to sell.

Put one in almost 1.5 years ago. It's still like-new despite a lot of usage.

The hardware is superior to comparably-priced competitors lines, though the boxes are particle board (the fronts vary in materials). That said - they are well built, very easy to install, and look good. While they don't have the custom-sizes that a higher-priced line would, they have enough variety, and have enough options for most people. In particular - their drawer options (sizes, stacking, and inserts) are great. And of course, they make everything to fit (jars, racks etc).

Are there any lenders who will do fixed home equity loans secured to a 2nd/vacation home, or an investment unit? I've called through at least a dozen banks and credit unions - and so far PenFed is the only place I've found, but their rates for non-owner-occupied are significantly higher. There must be a local bank out there doing this right? It's a small amount - looking to pull $50k or so, just want a loan term that is at least 10 years, if not 15-20. I'd prefer not to do a cash-out refi - I have great terms on my 1st and don't want to lose. Property is in Sacramento.

Thanks!

This recent article cites Blackstone as having 1,650 homes in the Sacramento region in their portfolio, with 105 bought just in the first half of this year. It also says their "sell to tenants" program aims for around 5% of their portfolio to be in flux. So, if they are buying ~200 homes/year in the region (about a 15% growth), with a stock of 1,650 - that's ~85 homes (5%) being sold off. Thus, they are still growing their local holdings currently, though of course that can change at any time.

http://www.bizjournals.com/sacramento/news/2016/07...

Regardless of actual numbers - the big investors like this can sway a market pretty significantly. Blackstone isn't just a housing investor - and when they decide much larger market trends make sense for them to focus on PE or any other vehicle - they could have major impact on the housing market.