All Forum Posts by: Seth McGathey

I have been investing in Real Estate for several years now but recently took the dive and became a Real Estate agent. I know the things I personally like to see in my former agents. But I am only one person. What do you other investors want to see/expect from your agents? What brings you back to the same agent for multiple deals and what makes you cut ties and use a new one? 

@Cole Bossert appreciate the feedback. Right now I am mostly saving. I bought my latest duplex less than 6 months ago. I have stabilized it after some minor consmetic repairs and a few necessary repairs. So I am short on financies right now and have to make progress paying down my HELOC I used to purchase it. I am using some credit card hacking to avoid interest while also racking up points. I also got my Real Estate License this year so that I can help others get into Real Estate while also padding my income to help me invest faster. Finally, I am looking into the feasibility of converting the basement of that same duplex into a studio apartment. If my preliminary numbers are right, I should be able to get all or most of my coversion money back in a cash out refinance after converting the basement. Plus be able to rent it for $900 while the other tenants already cover my expenses. So that extra $900 would allow me to get back in the market much faster.

Do you have any mistakes you regret from starting out? 

Checked ChatGPT and while it is out of date data, it says that 2018 10.3 million individual tax filers reported owning at least 1 rental property. Which leads me to believe it is significantly higher than that since many put them under LLCs and such, plus I am guessing that number has gone up since 2018. So 20 million might be pretty accurate. Pretty awesome. But somehow still crazy to me that it is only 20 million considering how great of an opportunity it is. 

Not major ones but each slowed down my progress. And all of them came from a simple lack of knowledge/wrong mindset.

1. I bought a single family when I could have probably afforded a duplex. This could have expanded my income up front. Not a huge issue as the property ended up doing well on appreciation and I have always been able to cover my expenses plus more. But it could have been much better with 0 extra effort. 

2. I sat on that first house for 4+ years saying I was getting into real estate but making no future moves. Most of that time I was unmarried, no kids, good income. It was pre Covid with low rates and low prices. I could have pretty easily house hacked into at least 3 more properties by the time I got married.

3. When I did get married and we decided to move, I was still in a Dave Ramsey anti-debt mindset. So I went with a 15 year mortgage on my second house. If I knew then what I know now, I would have done a 30 year with as little down as I could and taken that extra income/money and put it towards my next property. (I have been able to use all the equity for a HELOC which got me another duplex, but I could have done that interest free if it was saved rather than tied up in equity).

All of these mistakes are optimization mistakes and happened before I started listening to BiggerPockets and before I got my Real Estate License. I am still doing pretty well with my investments. All have been profitable so far. But if all three of these mistakes had been done correctly instead, I would likely be at 8+ properties by now instead of 4. 

@Peter Mckernan this is good feedback. One caveat though, I am not looking to sell currently. I am looking to cash out refinance. So what I currently care about it was it will appraise for rather than what it will sell for. I want to make these improvements and then be confident that I can get all or most of my improvement cost back. 

I have a duplex that I am currently renting out fully. I made several cosmetic fixes and I have started looking into turning the second half of the very large basement into a studio apartment. 

I know how to get a price estimate from comparables generally. But I don't really know how much I can count on the cosmetic fixes. And as far as I know, there are not any duplexes turned triplexes in the area. (I know that I need to look into zoning to ensure I even can add a unit). But how can I confidently figure out what the property will be worth when I try to refinance? Obviously I know it can range and even depends on the appraiser, but I just want to be as close to possible to make sure it is worth it. 

We just discussed this at my monthly meetup. A lot of the investors in my group actually prefer month-to-month for a few reasons.

1. You can get rid of a bad tenant faster/easier if something goes wrong. 
2. Easier to raise rents when needed.

3. A lot of the legal issues limit how far back a tenant can sue you by when your lease started, so it only goes back a month in month to month. 

Would I actually need to worry about a balance transfer fee? I would not be transferring anything. I would be making payments on my HELOC via their portal, which allows credit card payments. And then I would be depositing checks from my HELOC into my bank account and using that to pay of my credit card. So it would just be normal credit card transactions and normal credit card payments.

I recently used a HELOC for a down payment and for some repairs. I will have to hold out for a bit to cash out refinance to make it worth it. So I will need to carry the HELOC balance for about a year. I was considering getting a card with 0% interest and carrying the balance on that.

How will this affect my credit?

Is carrying it on my card worse for credit than carrying it on the HELOC?

I also considered switching it back and forth. (My HELOC allows me to make payments via credit card). So could I just use my HELOC to pay off the card right before they report my balance to the credit bureaus each month? Then pay off my HELOC with the card again once it has been reported.

Is this feasible? Is it that easy to know when they will report the balance? Is there any other things I should be considering? 

Also, if the card route is the way to go, does anyone have a card they recommend? 

 Thank you! This is exactly what I was looking for!