All Forum Posts by: Sara Finley

@jodysperling 

I am trying to take your response with a grain of salt.

I don’t agree with your assumption that we live beyond our means - 40k in student loans for Masters Degrees and 10k in car notes and 10k on an interest free Home Depot PRO card is not ideal - but certainly not “living beyond our means.” We have 401ks and savings, you should probably get a better overall picture of someone’s assets before you throw that term around.

We have certainly been sacrificing- I left my very well paying job to care for our children. Not something we planned for in advance or really thought we would do.

I could lay out all the ways we are sacrificing- but that is besides the point and a boring part of the story.

The reason we are even considering any of this is to capitalize on the current market.

Our first tenant to move out in 6 years + that house almost paid off + getting x2 what we paid for us = no “unsecured debt”

3 rentals is just that much more less stressful + buying in the current market would be stupid as we all know the story of 2008.

We could save the leftover profit for our upcoming school expenses- or save it for when the market calms down.

My last point - yes going the hard road is often worth it in the long run - but the physical and mental effects that stress has on our lives and bodies is a very real thing.

My last last point - I would hope my children will be street - smart and hardworking enough to not need our financial support - and with less stress in our lives maybe we will be around to see it.

Thank you for your response it has given me some things to think about. Good luck in your journey!

Hello! In need of advice from you smart RE peeps.

We have 4 rental properties plus our main house.

RH #1: Owe $13,000 - rented at $1200/month (long term tenant moving out May). We could easily rent this property for 1400 to 1500 a month right away due to the school district.

Monthly Expenses:

 Mtg: $530 (personal loan father-in-law at 3.25%).            
Taxes approx $300/month
Inurance,vacancy,repairs: $100

$1200 - 930 = $270 net

Original purchase in 2015 @ $52000 + approx $10,000 taxes and repairs (in PA seller pays commission yay!)  = $62,000 

The market in Philadelphia is insane right now - and prices are right back up to 2008 - 2011 prices. We could easily sell the property for about $133,000 or more in about one or two weeks. 

The other 3 properties have about the same monthly net. One will be paid off in 2, one in 3, and one in 7.

My husband is 46 and works full time from home in software engineering.  I am 36 and manage the rentals and our 2 and 10 month old. My husband is very handy (and slightly controlling) over the maintenance of the properties. We have been lucky - same tenants in all of the properties- no major repairs - on 1920’s row homes. 

Of course, Without kids - managing all this was easy. Now we certainly have our hands full and finding time to be good landlords and stay up with the “yearly - yes yearly” rental inspection can be stressful. And who needs MORE stress in their lives right now!?

My dream was to keep buying in that neighborhood- one a year - but that is not going to happen in the current market for us. We do have some debt - cars - some CC - and student loans. Altogether about $60k. The bulk of that is student loans at 6%. 

Long story short - 

Should we 1. Sell property number one for a cash net of approx $80,000 and pay off our debt.
130,000 - 6% RE Com - 6% Pa tax - (approx) $15,000 cap gain.

2. Sell them all and take the money and run (pay off all debt including main mortgage). And invest the rest until the market returns to “normal.”

3. Pay a management company. (Not my favorite option).

4. Hunker down and keep paying down the existing mortgages and deal with the stress! Note: 2 of the 3 tenants are lifers with no kids or pets (a landlord’s dream!!!) So management on those two properties is very minimal. 

6. Sell two and keep the two more desirable tenant properties?

7. Do a cash out refi of property #1 @4% for 10 years (approx $900/month) from credit union for 80k to pay off personal loan, and some of our debts. (Not my husband’s favorite).

My husband is pretty much on board for selling - but this is my little red wagon, so I need some outside perspective of our situation - and what would be the best investment strategy considering we have also started a family later than most. 

Thank you - and please let me know if you have any questions. 

Sara

@Mitchlyn D. - I used to use Cash App for some of my rentals. In the past few months I have heard and read about how unreliable the app is. One of my tenants got “locked out” out of their account for no reason. Just a heads up in case you want to research it. 

52k 3 bed 1 bath 1200sft row in Philly area

Invested $10k

Renting for $1400/mo same tenants for 5 years.

Happy house hunting everyone!

Hello

@Wayne Brooks  thank you for the short and sweet answer!

Hello - we are on SFR #4 in 3 years and our first short sale.

We waived our inspections and the sellers have accepted our offer.  We are still waiting for the bank approval with a mortgage commit date of 1\19.

Our mortgage company wants us to do an appraisal.

2 Questions:

1. Can the mortgage company REQUIRE you to use their appraisal company? The price they gave us is almost DOUBLE what it should cost.

2. Are we allowed to wait until the bank accepts our offer to complete the appraisal?  I would hate to spend that money and then have the deal go south.  I know there are costs to play the game but I want to be smart.

Thanks for any and all advice.

Sara

Hi @David Weintraub - The property is in Eddystone... That is where we have the rest of our properties. Its a blue collar neighborhood in a very good school district.  We have had no issues finding great renters...

It's not that I have zero capital I just don't want to stretch us too thin.  I was just looking at Lima One 2 + 1 Rental program. Do you have any experience with them?

I see what you are saying about the low property value. 

What other products do you suggest?

@David Weintraub  I seem to be having many foot in mouth moments lately...

I guess when I said eewww I am going on my lack of real experience with HML.

I've done a lot of reading and read some horror stories of people getting screwed on HML. Also, since I have never used one, the high interest rate scares me a little (but not enough to lose a deal!). So i'm sorry if I came off wrong and if BP would let me edit my post i would!

@Priscilla Z. Thanks for the motivation... I am thinking about asking my parents, who haven't been receptive before, but have seen our success lately and might be interested.

@Anthony Susco thanks! I have investigated home equity loans and i can only find ones that have high fees in contrast to the amount of money I need... do you have any companies you recommend?