All Forum Posts by: Robert Harlacher

Yeah I think I'll go talk to a local bank , Union Sabrings Bank, just because it's close and I can walk in and talk to ssomeone but I'm going to contact Home Possible as well.

I saw Bank of America has a loan called Affordable Loan Solution which is same concept as FHA I guess but they advertise having no Mortgage insurance. Being that they're one of the Big Banks, does that sound like something that might be beneficial to check out?

I would think local lenders or Fannie or Freddie would be better for first time homebuyers. Any thoughts?

Hi BP Community,

I'm looking to purchase my first investment property and trying to figure out what the best financing route would be.

My plan is to buy and hold so I would want to get into a multi-family property for low out of pocket funds now and house hack for a year or two, do a cash out refi, and use that for a down payment on another property and repeat the process. After searching the forum for a few days I started to get some ideas but not sure what the best route would be.  Some of the options I see are Freddie Mac's Home Possible loan, Fannie Mae's Home Ready loan, or go through a local lender for a Portfolio loan.  

I'm not sure what the advantages/disadvantages are between them though.  If anyone could provide some feedback or any experiences you had with any of them I would greatly appreciate.  Is one better than the other as a first mortgage to start with?   

I'm actually considering the same option and was looking for advice/suggestions on if it would be a good idea or not.  My parents are also nearing retirement age and were looking at selling their house to downsize and use some of the profit they got from the sale to pay off their credit card debt.  They currently owe $140,000 on a refinanced loan and the house is worth $300,000.  

I've been trying to get into REI by buying my first multi-family property but the market has been dry lately. The idea I came up with is to essentially buy their house for $200,000 at a lower rate giving them a profit of $60,000 for them to use to help pay off their credit card and get to stay in living in the house. What it will do is give me access to the remaining equity to use a heloc on an investment property that I will be buy below market value, fix up, refi and put the money back.

The mortgage broker I spoke to said it could be done by doing a "Gift of Equity" since it's between father and son so I wouldn't need a down payment.  Is this a good solution to do or even make sense to do?

I completely understand and appreciate your advice.  Like I said, it was an idea that I had as a way to get started.  I have talked it over with my parents and they're okay with doing it. I was more concerned at the fact that when looking at from a straight investment angle, as in it's not my parents house but a house on the market , the return on it isn't there.  The only upside would be that it gives me access to funds (equity) that I don't have on my own now to get something.  

It's more of a question of does it make sense from a creative financing angle to proceed with or wait it out for who knows how long until something else comes along that I could get with a CHFA or FHA type loan

Aaron - When I sat down with the mortgage broker who would be providing the loan,  he said the deal could be done with what's called a "Gift of Equity" so I would get a conventional loan but not have to put any money down.  It would be a normal 30 yr loan on the house so it wouldn't require me to live in the house at all.  I'm not too familiar with all the ins and outs of it all so that's why I was looking for advice from folks here.  

According to the broker, he said there wouldn't be any tax consequences on them because it's acting as though it's a normal sale with me purchasing the house.  Is that accurate?  

Brendon - That's one of my main concerns is that looking at it from an "investment" angle, it doesn't look good at all with the low ROI. My thinking was to just use this as a way to get access to funds for future investments that I don't currently have now.

If I stick to going with the CHFA plan, it gets me into a property with no money down but will require me to also have PMI payments.

The way prices are going around here now, going with the CHFA scenario, I would most likely be able to get into a multi-family with more cash on cash ROI but with equity value to low to borrow against for a years. Prices around here are averaging $320,000 and up. Trying to find something to get below market value to have instant equity and that cash flows is hard. That's why it's been two years so far and I haven't been able to find anything.

I also don't want to start out with my first purchase being the wrong decision and being that I'm a newbie,  I'm looking for all the advice I can get.  

Hi BP Community,

I would like to get some advice/opinions on my first purchase. Little background first, two years ago I made the decision that I wanted to get into REI obtaining buy and hold properties. With little funds to start with, I applied for a CHFA Loan and was approved so I began my search for a multi-family house where I could "house hack" for a few years to build up equity on the house which I would than tap into to buy another property, refi to pay back the equity, and repeat. The problem is my area has been very dry for multi-families for the past couple of years for properties in my price range or that fits my criteria.

Fast forward to today and situation hasn't changed much.  However,  I've been dealt a possible opportunity that I wanted to get the advice on.  So my parents are in a situation where they are thinking about selling their house to downsize and use some of the profit from the sale to pay off some credit card debt.  

From reading through the forums on here, specifically the 'Creating Financing', forum, I came up with an idea on how I could get my foot in the door of REI but not sure if it's a smart move or the right move to make being my first purchase. Their house is currently valued at around $300,000 and they owe $140,000 on it. My suggestion is to purchase the house for $200,000 which would give them money to pay off their credit debt and would leave me with $100,000 in equity.

I'm thinking I could take a heloc on the house in a year or two and use that as a downpayment on another property, fix it up, refi to pay back the heloc and repeat. The only thing that has me a bit hesitant is that when I run the numbers on the BP calculator, I'm left with a 4% on the cash on cash ROI, .88 % on the 2 $ rule, and a hundred and change in cash flow. So I'm essentially buying the house with no return but hoping to use it as access to the equity for future purchases.

Does something like this make sense or would even be smart to do for a first purchase?  Appreciate your thoughts on this.  

Hey Chad, welcome to BP. I'm a newbie as well from Danbury. You've come to the right place to learn about REI. This site has a ton of information available to start learning from.

Hi BP community,

I've started self educating myself a couple of months ago on REI by reading a few books and listening to all the podcasts on this site. The first book I read was The Book on Rental Property Investing and then went on to a couple others. Now I'm interested in getting The Book on Managing Rental Properties but I've heard that all the bonus downloadable forms that come with book only come with it if you buy through BP.

The problem is I only see it available on here to buy as a bundle with the Rental Property Investing book, which I already got through Amazon a couple months ago.  So my question is, is there a way to buy it solo without the bundle on here so I don't end up with two copies of the other one? Or is it possible to buy it through Amazon and still get the downloadable forms ?

Hi BP community, 

I'm looking for a real estate agent in the Danbury, Connecticut area who is investor friendly and/or experienced in owning their own properties.  My criteria is a multi-family property with the intent to buy and hold for cash flow.  I've already been pre approved for a loan so I know the range in prices that I can work with.  This will be my first property that I will "house hack" until I can purchase my next property so looking for someone that I can possibly work with on future deals as well.  My goal is to continue to purchase buy and hold properties at the moment and then venture into other areas of the business down the road. 

I've spent the past couple months educating myself by reading books and listening to most of the podcasts on this forum but feel that having some guidance on making the first purchase would be beneficial.

If anyone has any recommendations, I would greatly appreciate it.  Thanks all

@Joe Barletta I'd also be interested in your real estate group if you don't mind sending me info.  I'm currently in Danbury, CT looking for my first buy and hold property which I plan to house hack until I have enough for a second.