All Forum Posts by: Ryan J. Shope

@Dave Foster Thanks for the reference!

@Dave Foster, Thanks for the detailed response! What do you mean by normal transfer taxes in point 2? How do I pinpoint what the cost of a regular exchange is? Is $750-$1,000 just a standard brokerage fee or is that a federal filing fee? 

@Wayne Brooks Thanks for the response! Pardon my ignorance, but what is QI?

Hi all,

I purchased a 2bd/1.5br townhome in Summerville, SC nearly two years ago and am thinking about selling it and using the capital gains to invest in Seattle, WA, where I'm living. The townhome is currently estimated at over double my purchase price, so there will likely be substantial capital gain once it sells. I would ideally like to defer paying taxes on the gain and roll it into an MF property in Seattle so I can stop paying rent and house hack. All that said, I have a few questions about the process below:

1. Can I use money in a 1031 account for a down payment on an FHA loan? If not, can I use it for a 10% DP, or does it have to be a conventional 20% DP?

2. Will there be an additional taxes incurred from bringing the capital from SC to WA?

3. I haven't listed my townhome yet nor have I found a property in WA. Should I do a Delayed 1031 exchange?

4. What's my window of opportunity? 45 days from my sale to go into escrow with another property?

@Linda D.

A house hack is when you buy a multifamily and rent out the other units to pay your mortgage, so essentially you’re not losing any money to your mortgage payment. It could also be buying a 2+ bedroom house and renting the other rooms out, if you’re open to that kind of lifestyle.

@Mark Millich

Due to the age of the houses, I would be very cautious in buying it "fixed" for $40,000 and thinking that you won't need to put any more capital expenditures into the building. Even if it is a class D neighborhood, the price of those units is likely cheaper than the materials it would cost to build them. Assuming the seller wants to get it off his hands and make a profit, he's likely putting in as little as he can to get it cosmetically acceptable. You will definitely want to make sure the structure of the buildings are good (i.e. no termite damage to the frame, foundation is solid, main plumbing line wont burst on you. 

From one new investor to another, I would be careful biting off more than you can chew. I bought a VA foreclosure on the cheap and it gave me a world of headache for nearly a year. Hope this helps!

Ryan

@Cade Andrew Howe

You may be capped at four due to your debt to income ratio as well. Have you made sure to show your current lender that you have additional rental income that's being used to pay off the loans?  Also, if you're leveraged in other ways, i.e. student loans/car payments, that may be impacting you as well. My suggestion would be that you talk with you lender (if you've used the same one for all four) and explain your business/situation. If they still refuse to give you additional loans, then I would start shopping around for a new conventional lender. Hope this helps!

Ryan

Holistically, I think it comes down to how you view the potential deluge in any situation. Do you see something that's not adding up and say, "I can't do this (or I can't do this right now)", or do you say, "How do I make this work?" These other replies are correct. You (and I) need to research and figure out the right ways to play the game in the current economic cycle so we can ride the waves, no matter how them come. Lastly, no one starts out a great surfer. Skill comes from practice. 

@Anna Buffkin

What are the typical interest rates and terms you're getting from this lender? 

Hi,

So I'm finishing up my first BRRRR deal and would like to continue investing in the same area. However, I do not live in the market and don't have any sort of partnerships with realtors, contractors, inspectors, etc. What is the best way to go about procuring, contacting, and determining whether or not to try and form a partnership with the various service providers?