All Forum Posts by: Richard Hadley

@Mary Jay

The only way I think I would consider it is if I was buying it way below value and could flip it

Ok, so I currently have 2 separate properties that only have a balance of $18000. Each but they value at roughly $160000. Each

What I was thinking of doing was to get a 20 year mortgage from a different lender for $80000. To mortgage "refinance " just one of them. Out of that $80000. I would pay off both mortgages and also a $40000. Heloc on my personal property which I used as a down payment on an entirely separate property.

My current payments on these 3 loans are $395. For the first $18000, loan @ 4.5 intrest

$395.for the second $18000. Loan @ 4.5 intrest

And $689. On the Heloc $40000. Loan @ 8.75 intrest

Total monthly payment on all 3 is $1479.

My thoughts are even with these high interest rates, I would be better off borrowing some of the equity I have in just one property and get my other 2 notes freed up and my monthly payments would only be $680. Per month on a single $80000. Loan.

Am I missing something or does this sound like a good plan moving forward

@Autumn G.this situation should be in your rental agreement, ( tell me you have a rental agreement).

If you plan on being a landlord who does it all, it is one of your most important things to have in place.

My rental agreement is only exclusive to the parties on it, any and all others who are occupy the rental over 2 weeks time is considered a sublet which is not allowed and can be penalized by charging an extra amount for each person who is not on the agreement, and or eviction.

I nip this as quickly as I notice it, and make it clear that they agreed to it.

If "I" choose to let the extra people stay, they firs have to fill out an application and then be added to the rental agreement.

@Karl Huther

I am a contractor here in Maine, we have many old homes here, some older than the one you mentioned. It always boils down to the main part of the home, and what type of soil was it built on.

I have seen 150 year old homes that were in perfect condition and well maintained, these homes usually sat on elevated grounds with good drainage (which limits the movement of the foundation).

When a house is built on flat ground and or where clay is present. And drainage is pour, due to too much soil not enough gravel, in which the foundation cracks- sinks- crumbles, ect.ect.ect and the cost to repair is very expensive.

If you don't have personal experience with this, I would strongly recommend hiring an inspector with good credentials.

The foundation is the first and foremost important thing in buying an old home. Because everything else is going to follow.

@Jill F.

What is this full feature real estate software of which you speak?

@Brittney Wright

An llc provides another layer of protection from being sued by a tenant, however, all of my properties are owned by said llc, and are all commercial rental properties even though they are residential. Which means I can only acquire certain loans, at this point, if I aquire any more properties, I may start another llc and lump another 6 properties into that one, eventually I can start an umbrella llc that acts as a property management company, this type of structure has some pros and cons to it. But the level of protection is certainly in tact.

@Vincent Lattuca

With respect to all of the good advice that has already been given, I would also like to toss in your ability to over think a deal and losing it to another investor because you are afraid to launch.

Don't get me wrong, it is definitely important to do your due diligence. And you want to be sure that you will not only cashflow but be able to build a reserve to make your next purchase, or pay for capital expenditures. But if you haven't made a single deal yet, you can fall into the trap of being too scared to make a deal and passing on good ones out of fear and uncertainty. (Sitting on the fence)

@Bianca Rodrigues

Wether it be single family or multi units doesn't matter, what matters is that it cash flows, the more cf the better. It's an investment,

@Joe Villeneuve

Thank you Joe,

Your probably the first person who could put this into term I can understand, and honestly, my concept of investing is very much in line with yours.

I'm not quick to jump unless I know what makes a deal work, and who the deal is working for.

@Ben Zimmerman

Walt Disney has used this method to finance his endeavors, and the concept as it is to become your own bank using a specially designed whole life policy,

But your right about the math and numbers part, every time I talk to anyone who is using it, they don't give any numbers or examples, they just use terms like don't borrow more that the liquid cash value.