All Forum Posts by: Murphy Frankhouser

Originally posted by @Benjamin Seibert:

It all depends on your goals. I personally refinance all my properties into a fixed rate mortgage and try to stay away from ARM loans. I liked the stability of a 75% LTV 30 yr fixed rate mortgage. Easy to predict future cash flows and leaves some equity in the deal.

@Alex Bekeza is a great lender who offers these products. 

I agree with you on the 30 year fixed, especially with rates where they are currently. Probably should have done that regardless. I chose the 15/15 ARM because I was able to get the most cash out at that time. I anticipate refinancing again before the 15 year adjustment was what I used for justification of the decision. Do you think the strategy of refinancing from a primary residence loan to an investment loan would have been best/allowed?

I purchased a duplex as my primary residence in March 2020. I did a cash out refinance with the same bank still as my personal residence. Did I do the right thing? Should I have done the cash out refinance as an investment loan at 75% LTV (depending on the bank) and left some cash in the deal to allow me to go buy another primary home for 5%-15% down?

My thinking is that I could have gotten around the "having only one primary mortgage" rule by moving the loan into an investment loan thus allowing me to go and get another primary loan in less than 12 months. Or, am I mistaken, and the rule is that you cannot apply for more than one primary residence loan in any 12 month period regardless of if it has been "paid off" and a different loan placed against the property?

The details of what I actually did are below. I'm hoping to do something like this again and would love any input you all have for me.

• Purchase Price:$200,000
• Loan Amount: $200,000
• Loan Terms: 0% down, 5/5 ARM, 30 year term, and no PMI.
• Original payment: $1,332 PITI.
• Rehab Cost:$40,000. 

I did a cash out refi still as my Primary Residence 

• Appraised Value: $295,000
• New Loan Amount: $243,000
• New LTV: 82.4%
• Loan Terms: 15/15 ARM, 30 year term, and no PMI.
• New Payment: $1,373 PITI.
• Cash Pulled Out:$40,800.

I had a tenant in one unit from purchase date (March 10th) to June then another tenant from July through refi date (October 5th) on an 18month lease and a roommate paying rent the entire time on a 16 month lease. 

Try Union Savings Bank. They were going to lend to me as owner occupant with 10% down with several ARM options.

@Justine Scheuher L&N is where I ended up going with for a 100% financing 5/5 ARM. Without an income restriction.

@David Espinosa

I looked into that but I wanted to do the updates myself and a licensed contractor must do the repairs.

@Raphael Collazo

The property has peeling paint and a porch and steps without railing and a few potential other things.

Do you suggest I ask the seller to fix them and I pay a bit more?

I'm buying a duplex in Louisville KY as an owner occupant. I understood that 4 units or less Owner Occupied could get lower down payments on the property. I am not finding this to be the case. I make too much to qualify for housing programs in my area and duplex won't go FHA. I have tried several mortgage brokers and called several banks in my area.

My options are a 3/1 ARM @ 3.75% with 10% down payment or 15% down option.

Does anyone know how to get into the 3-5% down payment area?

@Jaysen Medhurst All that is true for those facts. Typically those areas in the OZ are significantly cheaper than non-OZ areas. This may be more beneficial for a OZ fund or a high net worth individual. Great thoughts on that! Thanks @Jaysen Medhurst.

@Jaysen Medhurst If you are a buy and hold investor the potential of 15% reduction in the deferral and the 100% non taxability of any appreciation after 10 years allows you to sell the property and have no tax. The 1031 it a never-ending cycle until death to get your heirs a step up in the basis and a nontaxable sale. Is it worth it to have the option to sell after 10 years for you?

Do you invest in these Qualified Opportunity Zones (which can potentially be rough areas) for the tax deferral and appreciation benefits if the cash flow is not as good as another area? I'm on the fence if this is a good strategy or not. I would love to get some thoughts on this topic.