All Forum Posts by: Nathan A.

Quote from @Richard Lawson:

What is the typical down payment for this type of purchase going the conventional route?

Typical is 20% for owner-occupied. You can go lower with private mortgage insurance, though.

As for the loan that includes two lots, I really have no idea.

I would concentrate on learning about how to analyze deals. There are a bunch of resources here for that.

To me, the best option is one that isn’t cash-flow negative to your financial situation the first few years as you get started. If you do #1, I'm willing to bet your expenses on the property your first year are higher than your rent now. You get in the game of property ownership at the expense of being house poorer, which would cut down your savings rate from where it is now. If you do #1 make sure you can actually save at a good enough rate to actually move somewhere else in the future and as @Nathan Grabau said make sure it doesn't analyze as cash-flow negative as a rental once you move out. Depending on the property, #2 has the potential to net out a little better for your personal financial situation relative to your rent now.

Also, live-in rehabs aren't super fun (speaking as someone who's been through one) and that really hurts your chances of getting roommates / using a SFH as a house-hack during the rehab.

A property's tax bill would increase as a function of roughly two things multiplied together:
1) How much that property's value has increased relative to other properties in the same jurisdiction.
2) The overall increase in the jurisdiction's budget from year to year.

If your value is going up in dollar value but percentage-wise it's roughly the same percentage as everyone else's property the main relevant factor is #2. If you are doing things to add value to the property, or the specific area the property is in is appreciating rapidly relative to other areas, then #1 becomes more relevant.

Make sure you don't use up all your cash on the purchase itself and you leave some for repairs once you close.

Take pictures of the condition of everything. Then get the junk out of there, get a handyman to fix the holes and the door, get the place cleaned and the carpets cleaned (if the lease says they should have), and deduct all that from the security deposit. You shouldn't feel bad about taking this stuff out of the deposit. You are running a business and this is what the deposit is for.

Although it's true you don't have documentation of the condition of the unit before those tenants moved in, the junk and the lack of cleaning are clearly their responsibility, and they're taking responsibility for the holes and the door by apologizing to you. It's great they apologized in writing -- keep a copy of that.

Some insurers won't cover pit bulls -- make sure yours does if you're going to keep the tenant.

Your tenant's marital problems are not your problem unless your unit is getting destroyed. You can't just evict someone because he is destroying his wife's property -- that isn't a violation of your lease.

Quote from @Michael L.:

could I obtain another FHA loan to utilize the 3.5% DP?

Only if you are willing to move 100 miles away or meet certain other tests.

Get the advice of an agent in your area but in addition to what's been said: paint job, flooring, exterior appearance (new siding/paint/power-wash/whatever) and landscaping. There are lots of lists out there like this one that might be worth scanning too.