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All Forum Posts by: Sergey Pshenichkin

Sergey Pshenichkin has started 3 posts and replied 5 times.

Hello BP folks! I’m currently house hacking my 2 bed/2 bath condo. Unfortunately I’ve currently got a lot of CC debt from a business that didn’t work out, so I’m working on repaying that to rebuild my credit. My plan is to do a cash-out refinance on my condo and follow these steps:

1) Cash-out refinance out of my FHA loan into conventional.

2) Use cash from step 1 to pursue a new property, likely with an FHA 203k or homepath loan.

3) Move into and house hack the property from step 2.

4) Rent out the condo.

I’m mostly concerned about qualifying for the initial cash-out refinance because of my income/work history. I understand that the debt will be calculated using my current mortgage and car payment (hopefully all credit cards will be paid off before I apply, and I have no student loans/alimony/child support/medical debt/etc...).

In 2019 I had a retail job which gave me a w-2. I got another offer in a different field, which began in August 2019. I left the retail job in October of 2019 to focus on the new job, and was laid off from that due to the virus in March of this year. I’ve also been driving for Lyft and am currently collecting unemployment. I’m starting an e-commerce business hoping it will take off, and if it doesn’t I plan to keep driving for Lyft to keep income coming in.

My current roommates aren’t on a lease, but I do have invoices of their payment histories (both have been living here for over a year). Of course once I rent out the condo I will have leases for those tenants. I realize that I should probably have my current roommates on a written lease, I just haven’t actually gone and gotten one.

Given all this, what would I need to show a lender in order for them to qualify my income for a cashout refinance? I’m open to any feedback or suggestions. Thanks for the help everyone!

Post: So what's holding you back?

Sergey PshenichkinPosted
  • Germantown, MD
  • Posts 5
  • Votes 0

@Frank Patalano near-crippling debt.

Post: Advice for a renter with low income and 2 kids?

Sergey PshenichkinPosted
  • Germantown, MD
  • Posts 5
  • Votes 0
Sorry, my app crashed and this is a repost. If someone could delete it, that'd be great. Thanks!

Post: Advice for a renter with low income and 2 kids?

Sergey PshenichkinPosted
  • Germantown, MD
  • Posts 5
  • Votes 0
Hey BP folks! I'm a longtime fan, first time poster. I actually just bought my first home last year in Montgomery County, Maryland (a condo with a low condo fee using an FHA loan, not a super great deal but very reasonable). I mostly did it to escape the black hole of renting, and I'm now working on increasing my income so that I can start buying rentals. I'm also trying to help my friends and coworkers out too, since most of them are renters in their 20s who'd like a home but don't really know what options are out there... Which brings me to someone I know who we'll call "Jane". She is currently in her late 20s and is supporting 2 kids and renting on nothing but her own income, which isn't much ($30k-$40k per year, W-2 salary). She's been at her current job for more than 2 years so she'd have tax returns. She's building her credit up from nothing. Not sure what her exact score is, but it could be boosted by paying off her $300 credit card (which has a high utilization at the moment). The only items on her credit are the car she bought last summer and the credit card she opened back in August of this year. I know this because we sat down and looked at her credit report in the Mint app (a soft inquiry, and yes I know it only gives data from 1 agency but I don't expect the other 2 to be vastly different). She pays rent through a low income housing program, which ties her rent directly to her income. This means whenever she gets a raise, her rent goes up, so she can't seem to get ahead. So here is our problem: she has no money for a down payment. Normally we could try a low or no down payment option like FHA or USDA, but those usually have a higher monthly payment to offset the low down payment. She's already struggling to make the monthly payments for her rent, so an increase in her monthly payments would be hard to afford. She also doesn't qualify for a VA loan. The best option I could think of for her would be a 203K FHA loan, but I'm worried that the combined costs of the principal, interest, taxes, property insurance, mortgage insurance, plus the repair costs and even potential HOA/Condo fees would be a lot more than she could handle. On top of that, repairing a house with 2 kids living there while working full time would be challenging for anyone, let alone a first time homebuyer. I admit though that I'm not familiar with 203K loans since the loan I used to by home was a standard FHA loan. For reference, she lives in Olney Maryland in Montgomery County, though she's not far from Silver Spring or parts of Gaithersburg and Germantown. She works in Rockville. So, hopefully you folks can see the bind she is in. If anyone out there had any sage wisdom to share, I'd love to hear it and pass it along. Thanks for the help!
Hey BP folks! I'm a long time fan, first time poster. I hope I'm in the right forum. I bought my first home last year in December, mostly to get out of renting (it was a condo in Montgomery County, Maryland with a low condo fee, not a super great deal but very reasonable). I'm working on increasing my income to hopefully invest in future properties, and trying to help my friends and coworkers on the path to home ownership since many of them are renters in their 20s and don't know the options that are really out there. Here is where I'm stuck: someone I know is currently renting. Let's call her "Jane". She has a w-2 job but doesn't make a lot from it (somewhere in the $30-$35k range). She's been there a few years so she'd have tax returns, and her credit isn't great but it can be boosted pretty easily by paying off her $300 credit card debt. She bought a preowned car last summer, and the car payment and credit card (which she opened 2 or 3 months ago) are the only items on her credit report. She has 2 kids and her salary is the only source of income in her household, and she's in her late 20s. She has no savings and no investments (yes, I know, we are working on fixing that) but fortunately she has no student loan debt or anything besides her car and credit card payments mentioned above. Now, I'm aware of some on the low and no down payment options for her (FHA, USDA, I'm almost positive she can't get a VA loan but I'll double check), but the sticking point would be the monthly payments. Right now she can afford her rent due to a low-income housing program, but even that is a struggle. The program is also tied directly to her income, so when her income increases, her rent does as well so she isn't any better off. Many of the low and no down payment options I've seen require mortgage insurance, which would probably raise her monthly payments past what she can afford, but if she tries to get a conventional mortgage, she'd have to come up with a down payment which she doesn't have. She could borrow it, but then she'd have to pay it back, which again would mean she's paying more every month... The best option I could think of would be the FHA 203K loan which would let her buy a property that's really cheap and fix it up. Hopefully she could find a property with enough of a discount that the PITI and the repair costs together would still be affordable, but fixing up a house with 2 kids living there while working a full time job would be challenging for most people, let alone a first time homebuyer. In any case, I'd love hear any sage wisdom that you folks might have. Maybe there are better paths for her? She's currently in the Olney area of Montgomery County, MD but she's not far from Silver Spring or some parts of Gaithersburg or Germantown, and she works in Rockville. Thanks everyone!