All Forum Posts by: Dustin O.

Hi Joe,

I am Active Army and currently have two open VA loans. It was the best way for me to get started with no money down. I have reached the point where it has become time to put a little skin in the game. BP is very supportive and supplies an unlimited source of resources. I use my military benefits and find myself always refining my TTP's . It seems that I am walking an irregular path, which requires more research.

Hello Joe,

I am always happy to meet more military in the forums. I have met many veterans and active duty members that have great knowledge and commitment towards real estate investing. I really believe that we need an active investment group. Currently I am also seeking collaboration and innovative strategy sharing.

We have many disadvantage as service members, however we also have unique benefits and social advantages. That if taking advantage of while in service; I believe will lead to stability, wealth, and continued growth.

Welcome Joe,

Did you have to provide a down payment?

Hello BP,

This web site has been a great source of experience and education, which has broaden my perspective and abilities in Real-estate investing. The biggest tools I have take away from BP have been creativity, confidence, and knowledge. I have just completed my tour in Afghanistan and now have time to work towards future retirement goals.

I have stood at a distance from forum posting, as I have found that most of my questions can be found by using the search bar. Also I do not have the experience necessary to benefit newer investors. However I am an active reader and I provide younger wannabes a strong testimony of what this site has provided to my wealth.

My strategy:

As a buy and hold investor, I have been using my veteran benefits (VA) loans to acquire new construction SFH. And then allowing my allowance for housing to pay for the mortgage. I then place the house for rent, this is to meet the 24 month requirement to use a percentage of the rental as income and rebalancing my debt to income ratio. (VA loans must be owner occupied for 12 months), It takes 36 months for this step to mature and another 12 months to save six months of mortgage payments.

I then purchase another home at my next duty station and repeat the process. I have never put money down on a property and so far I have not paid a mortgage note in over 6 years. The reason for only purchasing new construction is to avoid putting money into the home while maximizing my long term hold strategy. (this may be a flawed outlook)

My Question:

Currently I am maxed out on the amount of VA loans allowed to be open at one time. For my strategy to continue to work I have to close out these loans. Can I refinance into a conventional or FHA loan? And if I can, will I have to put money down?

The property I plan on refinancing out of VA is valued at $160,000. I owe approximately $153,000 and it was purchased at $181,000. I plan on making a purchase in the next 24 months in Hawaii. Just closed on a new construction near the beach and would like to acquire a low cost, live-in, and flip.

Any input on my strategy would be greatly appreciated. I do not know how widely used this technique is used. However reading the forums and because of my limited income this has been a winning strategy for me so far. And I have unlimited VA uses as long as the loans are satisfied I maintain DTI and solid credit. No need for cash accept for the six month mortgage, which allows for a good night sleep and can be saved over time.

I am pre-approved for a $130,000 mortgage line of credit. I am trying to use this money as wisely as possible. Currently I am considering starting a Franchise, or continuing investing in Real estate. I can retire in the next 3 years, so this is a very important decision for the future of my family.

Over the last couple of weeks I have considered purchasing a couple SFH, or one larger multifamily complex. I am also concerned about being unaware of the pit falls of a (LOC). I have a strong foundation of real estate knowledge but lack in experience.

Any advice, input, or even an example of how some of the investors would handle this situation would be greatly appreciated. I have looked at some of the older forums and have found some good information. But I am still missing some strong examples.

Thank you,

Well Shawn, I am pretty educated in the use of government money for veterans and military benefits. Using your Tuition Assistance, Montgomery GI Bill/911, Army College Fund, or Student Loan repayment option would be very hard to use towards property investment.

But if you have the Post 911/MGIB/ACF, you are allowed a pretty large housing allowance and allotted living expenses. This can be used for any type of housing to sustain you and your family. Depending on your location you could bring in over $2,000 a month just for housing accommodations.

And if you are truly interested in legally using these benefits I would contact your local education center which can be found at goarmyed.com or your post, JAG department. A quick phone call to an Army Recruiters office may help also.

An investment group for military vets is a great idea. We have disadvantages and advantages that can benefit us financially. The Journey is long but with patience and education we may retire young with substantial net worth. Speaking of education I took a few online Real-Estate courses that have helped me in understanding the mechanics of the industry.

American Military University completely covered by military TA and provides an associate degree in Real-Estate.

Hello Benjamin,

I will take a shot at this for you; I am not an expert at all and have learned many lessons from reading forums and hard life lesson. I have been in the Army going on 18 years this August and I am currently deployed in Afghanistan. The VA loan program is the best tool to get started in Real-Estate for us vets. I am in Escrow right now for a house in Hawaii that should be complete this November.

I also have another VA loan in Arizona that was also a brand new home when I purchased it in 2006. All are buy and holds and will continued to be rented out. I will be using my BAH to cover the $2,400 mortgage in Hawaii and my entitlement is about $2,700. The house in Arizona was cover by my BAH until I moved, at that point I have rented it out and to this day I still have not put a dime into this house and I have owned it for 6 years. (Mortgage)

The house in Hawaii will bring in a $3,600 profit every year for the next 5 years while I am stationed in Hawaii. So my first 5 years of ownership I will make a profit of $18,000 in government allowances. I put $0 down and $3,000 in escrow which will be returned at closing. The house cost is $427,000 at 3.75% near Ewa Beach, desirable location, easy to rent, 3 beds, 3 baths, 2 car. I had my Realtor do a rental analysis for this current year and it will rent between $2,600-$2,900 a month with the option to use as a Vacation Rental during peak seasons if vacant. The $18,000 is a low ball because as you know we receive an inflation increase on BAH every January which is between 2%-4%. Along with an increased value of the property, even in this economy Hawaii has little suitable inventory at the $500,000 range or lower.

And yes you are allowed to have 2 open VA loans. For more information go to eBenifits.com and check your VA entitlements and eligibility. You must live in your property for 1 year before you move on and you must meet general loan qualification. My advice is to call USAA and use their home buyer program for the military because you also receive $1,500 after closing. I am making $10,000 at closing which I will use for future investments.

You also may purchase a duplex, not sure on four or higher. But I think you can, but you must meet guidelines. There are so many angles on VA and its uses. As a Soldier I travel all over the world and have become a custom to the AZ, AK, and HI markets. To use your VA multiple times you will have to build or purchase one in one of the following locations: CA, AK, HI, and NY, to maximize your Tier ll benefits.

There are few experts in this field so I would contact your local VA
representative for more information.
I learned on the fly which can be costly and cause many delays during closing. I plan on retiring in Hawaii so the scenario works for me.

Hope some of this helps, if not ask away.

Hi John,

What is the advantage of having a LLC when your properties are already protected by insurance?

Learning from you, please do not take this as questioning your investing ability.

Thank you,

I have been following a couple of post on LLC. Personally I can not form a LLC for my properties as it well go against the policies of my banks.

So I have spoken in dept with my insurance company. We raised the liability for law suite claims to $500,000 and when necessary it can be moved to the millions. So, is a LLC even required during your starting years of Real Estate investing? And how would it be applied or beneficial for me in the future?

Or am I just missing the point of the LLC and how it should be established or used with investing?

Thank you, any insight would be appreciated. I may be over thinking this a little http://www.biggerpockets.com/forums/92-ask-about-a-real-estate-company/topics/new#