All Forum Posts by: Matthew Rutledge

Signed the paperwork for the refinance of the original rental house this morning. Finally. The underwriter made a mistake that almost cost us the lock. And the fires in Colorado Springs evacuated the corporate office of the place my wife works so they couldn't reach someone when they called to verify employment. But we got it all nailed down.

We need to let this one "age" a bit before we do anything else. Loan should fund on Monday, and be purchased Tuesday or Wednesday. After it is purchased I will wander into my local bank and start talking to them about 90% LTV line of credits. Once that is set up, I will be in a "cash buying" situation and then things will heat up quickly.

I have a couple neighborhoods picked out. There are retail homes available, foreclosures, and I'm sure there are also various distressed properties just waiting for the right buyer. The lady from the title company knows a realtor who works with one of the local banks... It's all starting to come together.

I will start the loan discussions late next week. If everything goes as planned we will have cash available by the 21st. If things line up, I might make my first offer as soon as the 15th of July. (Vacation and stuff has to happen!)

I'm getting excited. It's almost time to see if I've actually learned something with all the reading I've been doing.

Freakonomics (SP?) did a podcast about that a while ago. Inflation calculation/statements are largely based on the Consumer Price Index (CPI). So, "they" who track the CPI look at a fist-full of goods and track their prices and report accordingly. However, if the price of one product rises "too much" it is removed from the list and replaced with something that didn't rise too much.

Remember a few years back when the price of gas and diesel nearly tripled? Yup. Removed it from the index.

There's a bunch more to it than that, but that's the quick-quick run down.

-Matt

OK, it's hard to disagree with this. Inflation is real. The "CPI" is bogus. It doesn't take much to figure that all out.

But... The above is sort of what I'm banking on. I'm working to build my buy & hold inventory to be ready for the next bubble bursting and the next round of people who used to own their homes looking for a place to live.

Am I part of the problem? I plan to bring very little cash to the transactions, but intend to leverage almost everything I can to get into the game.

-Matt

Curious if you can expand on what you think those reasons are. I know a few people who have defaulted. The reasons they gave me were rather varied, and I assume only partially true.

Thank you
-Matt

It's been a few weeks. A frustrating few weeks. I am in the middle of refinancing my current rental.

I've gone through a few refinance efforts in the past (most recently Dec 2012) and this one is unlike anything I have ever experienced. I'm fairly certain the underwriter is either new or has never seen a tax return that consists of more than a couple of W-2's.

The goal of this refi is to simply reduce interest and monthly payments to aid cash flow. We are waiting for this to finish before moving forward on taking money out of the primary residence.

I had a timeline in my head. In that timeline, by now I would be scheduling a weekend to just look at houses with an eye towards making at least one offer and trying to start the clean-up & rehab before July 1 with an eye towards getting renters in in September. Unless a miracle happens, I need to reset expectations. If this drags out much longer I may even need to rethink my strategy. Trying to place tenants from Nov-Feb is pretty difficult.

What is my plan B?
Wait until Feb to buy - not excited about that.
See if I can wholesale one or two - has potential.
Maybe work a flip - also has potential.
Take the money from the primary and take the wife on vacation and/or buy a slightly used Porsche 911. - While fun, that's not going to help me ditch the J.O.B.

Mostly just venting a little and letting people know that I'm still around, still learning, still reading, and still excited to jump in on purpose.

Welcome George!

If things go well I hope to be doing some work down in the springs real soon now. Maybe we can meet up for coffee or something.

-Matt

In my newbie opinion, the biggest bonus for having a real estate license would be getting access to properties without needing to coordinate with your agent.

As an example, driving through a neighborhood and spotting a vacant house with a for sale sign on it. If you are licensed, you can just call the number on the sign and see if it's available for showing and "just walk in." Without the license, you have to organize with your agent and come back at another day/time.

-Matt

Welcome aboard Abraham. I, too, am amazed at the wealth of information on this site.

-Matt

Nice work!

While there is always a better deal financially, there might not be a better deal looking at the big picture and taking in "quality of life" as one of the variables.

-Matt

I'm not sure I follow. But I like that you chimed in before I started signing papers.

For tapping the equity in the existing house I am looking at a 2nd note on my primary residence. This will provide enough cash to purchase (full, clear title in my name), hold, and rehab at least one other house. At that point I want to refi the newly purchased house (after rehab) for only the amount of purchase and rehab, and actual money used from cash from the 2nd note on the primary.

The refi would be a cash out loan, but only on the new property. The cash would then pay off the second note on the primary residence.

My understanding (again, may be incorrect) is that using the equity of the current house as collateral (instead of cash) for a loan on the new place means I'm not actually considered a cash buyer in most situations. This should only really come into play should the house need too much work for a bank to accept the loan - that's probably too much work for me anyway! or in the case of auction where certified funds are needed on the spot, or potentially in a "avoid foreclosure" situation where a quick closing is needed.

Based on your response it sounds like I might have more questions to ask. But I'm not exactly sure what those questions might be. If you think I'm about to do something stupid, lets talk it out.

My mortgage broker claims to have been down this path at least once before... I understand I may be trusting the man a little too much, but we do have a rather longstanding relationship and I feel he has earned some trust.

Thanks!
-Matt