All Forum Posts by: Michael Evans

You need to setup a phone call or a face to face meeting with Peter.

If you live in the property (Owner Occupied), then the future mortgage payment (PITI) is included in your Upper Debt to Income Ratio (I think FHA limit is 43%). You also have a Lower Debt to Income Ratio (I believe FHA is 25%) that doesn't include your future mortgage payment.

If you don't live in the property, then the loan is based on the Loan-To-Value (LTV) of the loan amount compared to the market value of the property (usually no more than 65% - 70% LTV). They also look at your Debt to Income ratio, but I'm not familiar with those ratios for conventional investment property loans.

Best thing to do is to reach out to a local mortgage broker via your local Real Estate Investment Association.

God Bless You!

You're right, it did expire 12/31/13 and it has not been extended yet.

You don't have to have money to invest. There are lots of books on OPM (other people's money). I got paid $15K to buy my first house (I assumed an FHA loan in 1997).

I would focus on finding a 2-4 unit property where you can show that the rents from the non-owner occupied units cover the costs of the property (PITI and maintenance). I would then secure the property with a purchase contract that has an assignment clause in it with as little earnest money as possible, and with the longest contractual period to close the deal at least 90 days, try to get 180 days. Then go find a buyer to wholesale the property to or find a lender (hard money or creative investor) that will finance the deal based on the positive cash flow. Hard money lenders will typically lend up to 65% or 70% LTV, so you will need to find an equity partner for the balance of the loan.

You have to think outside the box.  Don't think using conventional means, think creative.  I turned $15K that someone paid me to buy my first house into $350K  from 1997 - 2005, then I took less than $30K in cash to control $1.8 million worth of property via purchase contracts and generated $250K in equity over a 3 month period.  I used stock option strategies with real estate.  Think outside the box!

A couple of clarifications. Short sale loss for a primary home is no longer counted as income. See "The Mortgage Forgiveness Debt Relief Act and Debt Cancellation" at eh IRS website: http://www.irs.gov/Individuals/The-Mortgage-Forgiveness-Debt-Relief-Act-and-Debt-Cancellation-. Next, you can roll your retirement account into a Self-Directed IRA (Google it), where you can then use the money to invest, without any penalty taxes due to early withdrawal. You can even loan it to a business, including one that you a partner in (as long as you own less than 50% of the business).

I suggest you do some homework on what you can and cannot do with your $20K, as you have more options than you think.

You can't be successful by yourself.  Every successful person has a team and when you are doing real estate deals, there are different people in different roles to complete the deal.  You need to determine which role you want to play in the deal and whether you can accomplish that role by yourself or is it better to partner with someone.  It's easy to be a bird dog or wholesaler by yourself, versus being a house flipper, you need a team to do the rehab.  And on the lender side, you definitely need a team unless you are wealthy.  Just my two cents.

First things first, you have to believe there is no such thing a deal that is too big.  All you have to do is develop your own investment model (Inputs, Actions and Outputs) based on what makes you feel comfortable.  a $10 million deal is just like a $100K deal, just more zeros.  if you come across an opportunity that you don't know how to take advantage of, that's when your turn to your team.  Every investor should have a sold team, and each teammate has a different role.  You don't have to be an expert at all parts of the deal,  just focus on what you are best at or like the most, then connect with those who can compliment your skills.

I can't give you advice on what you should or shouldn't invest in without knowing more about you: your goals, objectives, risk tolerance, financial condition, etc.  But I can give you advice on what mindset you need to be successful in this business.

Believe It, Declare It and then Do it!

God Bless You!

You can buy an owner-occupied house with an FHA mortgage, and then if you decide to change your mind and rent it, well that happens some time. Check to see if there is a waiting period before you can legally rent a house with an FHA mortgage.

When it comes to purchasing investment property, there are many creative financing methods to use, especially if you are looking to buy and hold. Have you developed your investment mode, where your model calculates the Inputs of the investment (cash and time), the Actions (buy outright, down payment for a mortgage, income versus expenses) and the Outputs (profit or loss). It all boils down to your ROI calculated on an annual basis so you can compare apples to apples when dealing with different types of investments. Hopes this helps.

God Bless You!

It's not the amount of money you to have (you can always find money), it's about the desire and the amount of work you are willing to put into the business/  I was paid $15K to buy my first house, so I know from experience what I'm talking about.

Get educated on the topic of real estate investing from FREE sources (there are way too many free resources to pay these education vultures that want to charge thousands of dollars for what you can find online for free). There are many roles you can play when it comes to real estate investing: bird dog, wholesaler, flipper, buy and hold, deal maker, lender, etc. Learn what they are and which one(s) you want to be. Be sure to join your local Real Estate Investment Association (REIA) and any other free or low cost real estate investment groups.

Connect with people in these forums and your local real estate investing groups and start participating in deals.  it's not hard, you just have to decided and believe this is what you want to do and you are going to put forth the effort to make it successful.  90% of people fail in real estate investing because they don't understand the role they want to be in and they don't put forth the effort required to be successful.  Don't be part of the 90%.  All you have to do is Believe It, Declare It, and Do It!

Bod Bless You!

Don't let anyone fool you into thinking that being a bird dog requires the amount of time and effort as being a wholesaler.  A bird dog is focused on screening properties that fit the wholesaler's criteria.  The bird dog doesn't interact with the property owner, doesn't make offers and doesn't tie up a property with a purchase contract.  You have to determine how much effort and time you want to put in.

Bird dogs usually get $500 - $1,000 per closed deal, while the wholesaler is looking to get $5,000 - $10,000 per closed deal.  There are many wholesalers who will pay you under the table, but I wouldn't recommended it.  You can enter into a very simple agreement that identifies the property you located for the wholesale and if they close the deal or assign it to another person and receive money for it, you receive a specified dollar amount.  These are simple one-page agreements where you will in the blanks.  The main thing is that if you provide good leads that turn into closed deals form which the wholesaler makes money, they will gladly pay you because you've made their job easier and they can spend more time dealing deals rather than looking for deals.

Just my two cents.