All Forum Posts by: Rikako W.

Thanks for the reply, @Mike McKeown

Thanks @Mike B.  and @David Lichtenstadter!

Hello BP, 

I need recommendations for Hard Money Lender and a contractor in Philadelphia, PA. 

We have a legal 2-family house under contract in Roxborough, Philadelphia. It's NON-move-in ready and we cannot find any conventional mortgage lender who would lend to us. (Seller started the rehab but quit in the middle, and it's missing kitchen and bathroom. I wrote about it in this BP post.) It seems that we have to go to HML. We plan to buy and hold (NOT a flip).

Purchase price is 195K, we estimate repairs to be 15-25K, and ARV of $275K.

This is our second deal. Our 1st was a 2-family house-hack in Union City, NJ. We bought it using FHA, renovated it, and refinanced into conventional.

Any input / advice / recommendations is appreciated. 

Thank you!

Rikako

Hi BP community, 

My husband and I have a house under contract now, but we cannot find any lender who would finance a Multi Family, Investment property (not owner occupy), that's NOT move-in-ready.  The seller was in process of rehab and quit before completing.  It's a legal 2-family house in Roxborough, Philadelphia. The 1st unit is almost done (kitchen and bathrooms are good), but 2nd unit is missing bathroom and kitchens. In the 2nd unit, the bathroom is gutted, plumbing hook ups are there, but there are no toilet, shower pan, and the room is open to the studs. There is no kitchen sink or range. Banks do not consider this "move-in-ready". 

From what I understand, below are Fannie Mae guidelines. 

• For conventional loan (20% down, pay rehab out of pocket), all units need to be move-in ready.
• For renovation loan, all mortgage companies only do single family houses, or owner occupied multi families (203K). 

I'm left to think that only options left are hard money lenders. Does anyone have any experience in navigating similar situation without using hard money? We could get hard money, rehab, and immediately refinance into conventional. However, I'm just really afraid of using hard money... This is our 2nd deal (1st one is a house-hack using FHA).

Please chime in if anyone has inputs/recommendations for HML! We need to find a lender right away.

Separately, we need recommendations for contractors who can install kitchens and bathrooms. The job is not too big, we estimate it to be about $15-25K. 

THANK YOU! Happy July 4th!

Rikako

Hi Eugene, 

I have one I can recommend. Please PM me.

we have a 2 family house in Union City built in 1893. we pay about $1050/year.  PM me and i'll send the info of the insurance broker. 

hi! we used to live in Astoria (along N/Q/W trains) till 2 months ago. We looked everywhere in Astoria and in Queens/Brooklyn, but couldn't find any property that would even come close to making financial sense... well, at least within a reasonable commuting distance to our work in Manhattan. so we started looking in Hudson County, NJ, and bought a 2 family house there. We used FHA and we are house-hacking. it's been a huge learning process, everything from purchasing to landlording to renovating. so far so good though!

good luck!

@Ken Dayal I need a recommendation for an electrician, too... will send a PM!

Thanks everyone for commenting! very interesting. @Matt H. and @Michele Fischer, there is only 1 bathroom in the tenant's unit.  How do you remodel a bath while they live there? I don't think you can if there is only 1 bath?? (there is another bathroom in the cellar which is not a legally occupiable and is separate from tenant's unit. we wouldn't want them to be using that bathroom though.) 

@Simcha Davidman Thanks! I actually just found out today that the tenant has been there for 3.5 years. Finally got clarification from the seller after bugging them for a long time. (it's taking about 5 months to close and I asked about this in the beginning!) They signed the M2M lease 3.5 years ago, and the seller never raised the rent since then. I'm pretty sure they are not staged, but I've heard of those scary stories too!  The seller owned the house for 30 years and lived in it for the first 25. It seems like he's selling the house simply because he's getting old. 

@John P. Good point. From what I'm hearing from everyone here, it doesn't seem like a problem to raise rent to bring it to market at a later date, if they are on M2M lease. 

@Thomas S.  You are right. The issue is about avoiding vacancy / headaches during the holidays.  If we were doing this in spring / summer, I think we would raise the rent right away.