All Forum Posts by: Jim Blackburn

@Bryan Boulware

The main difference is that that the 203k Loan is FHA Loan vs Fannie Mae Homestyle is a Conventional Loan through Fannie Mae. Freddie Mac is also coming out with their conventional renovation loan program soon too.

In general terms, we use FHA when the Buyer has either:

• a) credit score below 720 (because the monthly mortgage insurance and interest rate are less than conventional, or
• b) a debt/income ratio over 45%, or
• c) very little funds for closing (since only 3.5% of the combined purchase price + renovations is required for FHA vs 5% for conventional loan. Also important to note is the max seller credit with FHA goes up to 6% (or total closing costs & escrows whichever is less) VS 3% for conventional financing.

In addition to that, FHA allows people with foreclosure, bankruptcy, short sale, & deed of lieu to be sooner after a derogatory credit event than a conventional loan will.

And finally, know that FHA requires you to live in the property for 12 months as your primary residence VS Fannie Mae Homestyle conventional renovation loan can be for investment property.

Finally, not sure if you are FTHB or not? If you are, I recommend that you read this post here to learn how you can buy 4 units up to 627k with just 3.5% down in St Louis County, plus get the seller to cover all of your closing costs and escrows.

Check out my post on this thread.

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

@Algi Skukauskas

As a FTHB, I highly recommend using your 80k cash to take control and ownership of 4 units with just 3.5% down. You only get 1 shot to take advantage of this and after you own your first primary residence (assuming you bought single family), you will then need 25% down to purchase a 4 unit primary because then you will be underwritten as an Investor.

For example, when it comes to Pittsburgh mortgage lending, the Allegheny county loan limit for a 4 unit is 605,525 means you could purchase a 4 unit property for 627k with just 3.5% down and get the seller to cover all of your closing costs and escrows.  

Read my post on this thread.

https://www.biggerpockets.com/forums/311/topics/491821-help-with-purchasing-first-multi-family-home

@Chris Fi

From a Leonard perspective, we’re going to look at the property address, and the operating income statement of the building, and your ability as a property manager. That’s 80%.

The other 20% is your personal income assets and credit used for illustrating your financial responsibility.

Jim

@Jonathan Newlin

I would contribute at least enough to get your employer match… After that you have to look at your taxable income… And decide if the deduction is worth more to you than what the return would be that you could generate with the after-tax dollars that you would get if you didn’t put it into a 401(k).

Jim

@Chris Wilkening

Is Dave Ramsey married?

Does Dave Ramsey have kids?

How old is Dave Ramsey?

What are Dave Ramsey’s most important financial goals; preserve wealth, avoid volatility, build wealth, reduce taxation, estate transfer, litigation avoidance, or generate income from his media?

What is Dave Ramsey’s risk tolerance?

What is the risk tolerance that’s required in Dave Ramsey’s portfolio to achieve the returns that will grow his assets enough so that just a 4-5% withdrawal rate in retirement will suffice his supplement income goal in retirement?

Does Dave like Pittbulls?

Suppose you’re 35 year old man, with no kids, $250,000 annual income, and proud owner of a Pittbull.

Suppose you find out Dave hated Pittbulls, are you going to kill your dog?

@Monte Blunk

Consider paying the tenants to leave. $1,000 or $2,000 may get them to jump.

Jim

@Keri J Perez

Legally required to perform on the contract and buy it unless you have an escape clause.. or if you can get a lender to send you a denial letter for a financial reason then you can get out and get your earnest money back.

Kim

@Kristine Lynch

If you live in the property, and if your primary residence now, why not tap into the equity of the home equity line of credit, before you move out to rent it? That way you can use the cash to put down another property.

@Anthony Sorrentino

Do you already own a property as primary residence? If not, I would use the 20k to buy a 4 unit property with 3.5% down with seller covering all costs. 20k will get you a 571,000 piece of real estate.

Jim

@Wy Kay

Depends... Are you just stopping by to collect rent or to make a citizens arrest?