All Forum Posts by: Ryan Howell

@Maugno M. Are you still eligible for traditional financing, aka Fannie Mae loans? You should be able to get 70-80% LTV on a fixed rate 30 year loan if you have no more than 4 loans and meet the debt to income requirements. I would keep talking to other banks. Be up front about your credit score and debt. Ask if you are eligible for a cash out refinance. If they say no, then ask why and really try to understand why you are disqualified. It could be a seasoning period or some other reason, but most loan officers will explain it to you but you have to ask the right questions.

@Carey Cook Welcome.  I'm planning to be at this month's meeting.  Hope to see you there.

@Matthew Newby. Welcome to the site. I’m investing in the Hendersonville area. Take a look at CREIA as well and check out their meetings if you haven’t already.

I believe there are a lot of opportunities outside of Asheville, as well.  I own rentals in Hendersonville and have been looking at Brevard as well.  It may be worth looking at some of these towns in your search.  The prices are less inflated in my opinion compared to Asheville.

Absolutely. I have 3 duplexes in Hendersonville. Feel free to connect and send me a message. I am still looking to buy more. It's difficult to find good deals on the MLS but there are are occasional deals. In general, the area is great and the prices are still better than Asheville, where I believe the prices are getting inflated.

@Jake Thompson. I recommend paying off the debt. Don’t ignore the psychological aspect of it. I think this is where I would side with Dave Ramsey. If you are waiting to invest until the debt is paid off you will be much more motivated to hurry and get the debt behind you. You are more likely to sell things, etc. You also will teach yourself habits to prevent more “bad” debt in the future. Those two things will have more ROI in the long run and help you achieve FI faster in my opinion.

@Marcus Holland Welcome! I’m also in the Asheville area and a new member to CREIA. Hope to see you around.

I think it depends on the opportunity costs and your market. If you think you are very likely to find better deals with better cash flow it might make sense to sell. If not and your market is very hot, I would tend to hold on to it. I'm guessing if you sold and bought properties, the rates would be higher than what you have now, so keep that in mind. It make make finding a higher cash flow property even more challenging. A HELOC would be a good option to keep some equity, your current rate, and still get enough for a downpayment on a second property.

You need to estimate your expenses as accurately as possible first.  As part of that equation, you have to have a plan for financing otherwise, you won't know what cash flow you will be able to achieve, as that is a function of the interest rate and amortization period.  I would assume at least $5k-$10k in repairs, even if the property is pristine, especially if you are inheriting tenants.  Every time I've inherited tenants, I've had turnover.  So for the short term, you need to keep enough funds to protect for any negative cash flow you may encounter up front.  

For the loan, I would plan on talking to commercial loan departments at various banks since you have 6 units. They won't appraise with comps, but based on the rent and NOI. Verify you can qualify for a loan and what the ARV requirements, etc, are. Recently, my lender told me they would do a 5/1 ARM, 20yr am. with 80% LTV, assuming 8% cap rate in my area.

I would plan on driving down there, walking through every unit with the inspector.  Then, if you are using a PM, take them with you to meet the tenants.  This will quickly give you a rough gauge of expected turnover/problems you might inherit.  

I use laminate plank flooring. It is easy to lay, water proof and scratch proof. It is also relatively cheap.