All Forum Posts by: Ryan Duphorn

$269,800 loan. Loan origination charges are $4,670 (origination fee) and $1055 (underwriting fee). My loan is a 5% down owner occupied conventional loan at 7.5% interest. At first glance, this seemed high to me but I'm not sure if it's because of the current mortgage market / industry as a whole. I'm already under contract with a less than 30 day closing timeline so time isn't quite on my side.

I pulled up my closing costs from my last home purchase in Nov of 2021 and it was $1200 for a 3% down conventional owner occupied loan at 3.25% interest. Again, not sure if the market has shifted.

 Roughly 40% of them aren't functional. Either don't open because the pull tabs/springs are broke or extremely difficult to open

Hello all - could really use some input on what you best recommend for this semi complicated decision that has been consuming my thoughts for 2 weeks now. My rental was built in 1987 and has the original aluminum windows. There is no damaged glass on any windows but only about 60% of them operate properly (some don't open, some partly open, some very difficult to open). Energy efficiency is zero to none but not as much of a concern to me as tenants pay utilities.

I got a quote from Lowes on a full house vinyl window replacement (12 windows total) plus a sliding door that needs replacement due to broken glass on one pane. However, the focus here is on windows but note that the quote includes the sliding door. The quote is $9450 if paid cash, and $11,820 if financed at 7% over 5 years.

1st question is do I bother to replace the windows on this rental?

2nd question is if I do replace the windows, should I use my current HELOC of $70k to pay the 'cash' price of $9540 (note my current market interest rate on my HELOC is 8.25%), or just finance the $11,820 through Lowes and not tap into my HELOC. I have plans to use my HELOC balance towards future rental property purchases (down payments & rehab costs). The monthly payment through Lowes financing would be roughly $190 / mo for 5 years.

Note that I don't plan on selling this rental anytime soon because my mortgage payment is $960 / mo (bought it at 3.25% interest rate) and it rents for $2000 (4bd, 2bth, 1900 sqft). I bought it way under market hence my $70k HELOC when only owning it for a year and a half now.

Pros of replacing windows (pretty obvious) - no complaints from tenants on window operation (although this hasn't really been an issue so far w/ my current tenants), bonus in ARV when/if decide to sell, and energy efficiency.

Cons - roughly $10k expense, if I use my HELOC then $10k of the balance goes towards a non cash flowing investment (I don't interpret new windows as generating cash flow), if I finance then I add to my DTI which could hurt me when attaining future loans on future rentals.

I tried to keep this as concise as possible while laying out the full scenario. Any advice is greatly appreciated.

Hey man I invest and live in the Richmond market also. I'm currently house hacking my rental by the room but moving out soon once I get my next property under contract. Once I move out though I'm leaning towards just renting it out to a family and collecting/managing rent from one party. In my opinion, it wouldn't be worth the extra hassle collecting rent from 4 individuals, plus have to worry about the tenants getting along. 4 bedroom house I can rent for $1900-2000 and if I do by the room it would be around $600/room x 4 = $2400. I find the extra $400 to not be worth it.

What has your experience been like doing it by the room?  

Talk with a lender first to see what you can qualify for. Keep in mind that you and thousands of others are looking for multi family especially in a big city like Atlanta. You have to be different - the chances of you finding a deal on Zillow that others haven't seen / run the numbers on is very slim. You need to gear your focus on off-market strategies / relationship building. I don't want to jump into all the various off-market strategies so will leave it up to you to do a simple google search on them and research the ins and outs. Hope this helps.

What software/website do y'all use for tenant screening? What about for managing your rentals? In my limited research on this, I've noticed that most tenant screening websites charge roughly $30 per background check. Do y'all charge this to the prospective tenant or eat the cost yourself? 

Thanks in advance!

Thank you all this was very helpful

Looking to get out of my current house hack to buy another and not sure on which strategy to take. Do I cash out refinance to a higher rate? That doesn't sound promising. Do I pull out a HELOC? I've read these rates are adjustable and that you want to pay this loan off ASAP or you could get screwed in the long run. I currently live for free in this house hack. Fully rented it would go for $1800 / month to start. I bought it in 11/2021 at 3.25% interest rate with a 3% down conventional loan. My current payment is $1100 / month. I would use my cash flow on this property to help pay for my monthly mortgage on my next home. Then use my full time job to eventually pay off the HELOC. Any help on which direction I should take in order to acquire my next property would be greatly appreciated. Let me know if you need more info.

4b / 2ba / 1860sqft

PP: $165k

Reno: $50k

ARV: $290-300k

Haha love this. I currently rent a former funeral home with a couple of my roomates. Obviously you would have to get it zoned residential which seems like you already got a hold of this process. I'm sure there are enough crazy people out there who would rent an old funeral home... like me! Haha all jokes aside, the numbers line up for you. My landlord had no problems filling this rental with tenants because it's on our college campus. Coming from a tenant who is living in one, I have no issues with it being a prior funeral home because rent is cheap, the remodel done is actually very nice, and I'm a college student so what the heck do I care! 

Glad I came across this post - got a good laugh out of it. I say if the rent price is reasonable and the renovation is done correctly, you should be able to fill it. Not sure of your area but maybe gear your marketing efforts towards younger, college students? Best of luck!