All Forum Posts by: Nate Tew

Just to follow up here guys. The issue was that my lender was counting all the loss against me when it should have actually been looked at as part of the depreciation for taxes. Talked with another lender and my cpa who confirmed it.  The next month we bought a house with private money loan, worked like crazy on it, and spent 75k on rehab. It appraised for $74k my final purchase price from paying back private lender. Good lesson learned to not stop at the first roadblock thank you for your input!

@Paul Crosby II@Kristen L Garner @Joe Miller

 Good point, thanks for your input!

Wow, yeah I had no idea about this punishment. Ok I will look into a DSCR loan for sure. Thanks for your input!

Hello all, 

Story: I am seeking some advise on a personal challenge I have just run into with getting approved for a loan for a primary residence. We own 2 investments properties and they are in our LLC that was formed last year. We transferred our former primary residence in the LLC and made a rental last year and then we purchased a town home as an investment the end of 2021. With all of the money going into purchase, interest, repairs, depreciation etc. we were able to write off a lot for taxes. We came up with a total loss from the LLC of 62k for the year. We will be getting a decent personal tax return from our K1 ownership in the LLC.

Problem: Now, as we have submitted everything with a loan officer for us to get approved for a load to purchase a primary residence we dont qualify. The 62k that was a loss on our taxes is counted against us completely as a loan qualification. Example, if I make 65k from W2 a year - 62 of loss for 2021, the lender can only use 3k of income to qualify. The lender says that they use 2 years average for rental income, and its the same for the LLC. So even if we don't show a loss and break even this year (2022), then come this time next year getting approved for a loan we are already 31k knocked off of our qualifying income for a loan.

Solutions????? I need some! : I have a private money loan option that would require me to pay the full loan back a  year from purchase, but I am afraid with this situation I wont even be able to get approved for a conventional loan this time next year as well. 

Any experience with this? How to approach it??

I have tuned in to so much of the bigger pockets materials from books to podcasts and meetups and I am very grateful for this platform. Somehow I have never heard of this issue or challenge yet so I completely got blindsided with it. Any advice or experience is much appreciated!

Looking at purchasing a home that needs to be completely redone. The siding is asbestos and is in decent condition but has some small replacement pieces here and there. My question is should I patch repair or plan to replace all of it? If I have to repair all of it I may not pursue the property because the total costs would make the deal not work.

It’s a 2 bed 1 bath 1250 sq/ft home SF home.

I would recommend buying a home to live in to start off. My thinking is that you will have a smaller down payment requirement (3.5 -5%) if you go that route, and you are growing equity on a home that is worth more in the long run. If you purchase an investment you will be required to put 20% - 30% down while the total value of the property will also be worth less 20 years from now than your primary resid. that you paid less cash for and would have greater value. May not be the cash flow win but your building greater long term equity.

@kat Great, thank you for your thoughts on this! I agree with the typical HOA being what throws things off but with master insurance and all exterior maintenance coverage in the HOA it will offset the Repair & Capex budget. Going with the townhome search b/c the cost to purchase goes from $125 sq/ft to SFH of $170-$195sq/ft

@Katie Phillipsundefined

Hello all! I know this can very differently for each area that you invest in but my question is about anyone's overall experience and thoughts on rent amounts for townhome vs single family. In our area what I have seen for an updated nicer home is that you can rent it for about $1 per square foot (for 2 bed - 4 bedroom homes) give or take a little. 

Town homes though I know could be different because it doesn't offer a yard and as much privacy. In our area its a desirable county because of the great schools as well as being close to the beach (this unit is about 15 -20 mins from beach). This town home is a new build 1700 sq/ft. What differences would you expect for rental amount and occupancy compared to single family (1 year lease and long term hold)? 

Hello, any help or insight would be appreciated! We (my wife and 2 little boys) currently are doing a few last updates on our current home getting it ready to advertise to rent. 

1)Anyone have any tips or pointers for advertising a home to rent while living in it as well as the relationship with potential renters starting off knowing that we are the owners?

2) When talking with our mortgage lender we can qualify for the purchase of a new home once we have a 12 month lease signed and the security deposit in an account. Does anyone have any experience with this situation and the best way to handle that? 

This will be our first property rented out and just hoping to do it the best way possible. Much thanks!