All Forum Posts by: Patrick Martone

Our goal is to househack and rehab a 4plex with my father. Looking in NJ, FL, and TX.

We have an LLC, perfect credit, own two homes, and 3 vehicles. I have 100k cash, a 401k and appreciating stocks.

My dad will pay the mortgage monthly and I will make the down payment.

I want to purchase a second MFH 3 years after my first MFH, so I don't want to put all my cash on the table.

Scenario 1 (20% or less down on conventional loan or 30 yr mortgage, or commercial loan):

1. How can our assets help me make a larger down payment? Or at least speed up the loan approval process?
2. Can the LLC provide any financing advantages?

Scenario 2 (Streamlined FHA Loan):

1. Can you use a streamlined 203k loan purely for the 3.5% down payment? Or does it need to require rehab?
2. What is required to become pre-approved for a FHA loan?
3. What other FHA alternatives are there where I can contribute less than 20% on a down payment?

@John Horner @Adam M. Rehabbing will be my full time job, and my father will make mortgage payments as i put down the initial down payment. After completion of my first home I may return to the workforce temporarily if the income will propel me where I need to go.

@Ceary Williams I was looking at Newark, my family is from Kearny, but I heard its a bit of a challenge for first time investors. Ironbound is supposed to be good.

@Adam M. I am willing to move and do whatever it takes, pretty nomadic at this point.

In 3 years I want to have 2 mfhs ideally 4 plexes.

In 5 years i would like at least 50,000 in cashflow.

In 5-10 years I want to consolidate my property into one 10 unit building and hire a good property manager.

How would you proceed and where? NJ is most most accessible, but more stress and tighter margins.

-I have 100k in cash. After establishing a track record I may consider partnerships

-I am familiar with NJ, Houston, and South Florida. alternatively I may do Charlotte or Raliegh, Dallas, Columbus, Minneapolis, or Nashville memphis.

Scenario 1. My goal is to househack and rehab myself a 4 plex and cash flow it. I can go the Streamlined FHA route and refi later or put 20% of my cash down on a 30/yr.

Scenario 2. I start by flipping SHFs with the cash I have to build more capitol towards a 4plex (Scenario 1)

Should I just jump into scenario 1?

Should I build up more capitol through scenario 2? 

What areas would you recommend?

@Manuel Rosa What permits did you need to receive, and did you do any of the rehabbing yourself?

@Austin Youmans thanks for clearing this up

I want a 203k Loan so I could afford a 4plex without losing all my capitol at once.

My father and I want to do the work ourselves with a Streamlined Loan. We have perfect credit and $80,000 in cash reserves as well for contingency (hopefully it eases the process).

What can we do to take on as much responisiblity as possible? 

We have considered becoming liscensed contractors to do the work ourselves and even becoming a FHA compliant contractors. My father is a carpenter, and I used to be an engineer and inspector.

Is there an easier way around this?

Also after the initial construction is completed and everything is signed I assume we can continue making upgrades through sweat equity. I plan to refinance after a year of living in the house.

Could I live in the home if my father puts the loan under his name?

@Mitch Ottoson @Charlie DiLisio Me and my father want to do the work ourselves with a Streamlined Loan. We also have some cash reserves I wanted to 203k Loan so I could afford a 4plex and not blow all of my capitol. 

What can we do to take on as much responisiblity as possible? We have considered becoming liscensed contractors to do the work ourselves and doing the FHA contractor course.

Is there an easier way. Also after the 6 months I'm assuming we can continue making upgrades with our sweat equity

@Austin Youmans i am trying to do a similar senario. My father an I have all the tools and experience, but obviously we can't be our own contractors even if we became liscensed.

What are some ways we can reduce the renovation costs, and then do upgrades after refinancing or after our funds are released from escrow?