All Forum Posts by: Shane Short

@Akeem Moreno Hey man, one more update. I was able to confirm that Hard Money Lenders won't lend on owner occupied properties for the most part. There is too much risk involved since that's one less unit that is cash flowing. The property has to be strictly business use or there is too much red tape, and there are penalties (like foreclosure) if you try to be sneaky with it. With that being said though, you could still get a hard money lender for the repair portion at like 10-12% interest, then once the repairs are done, refinance into an FHA, THEN you can live on the property no problem. You'd actually be required to with an FHA lol.

Just wanted to clarify! Keep us updated!

Regards,

@Alex Bekeza I appreciate the input! I'll definitely keep this information in mind going forward with investing. 

@Carolina Selva I would agree with Alex then in that case. If you're looking for a local Mortgage company, Sam Sumner is a Senior Loan Officer with Academy Mortgaeg company here and I know he has a lot of trust from local investors. I've heard tons of good things about him and plan to get a Mortgage through him this fall. If you'd like his contact information feel free to reach out to me. 

Regards,

I've had tenants complain that they can't smoke weed indoors... 

Hey @Carolina Selva! I'm not sure how much time you have left and/or if the seller is willing to hold for an earnest money deposit, but you could possibly refinance your home into a Conventional and use the FHA again depending on how long it's been since it's origination?

As far as hard money lenders, my recommendation would be Rain City Capital, you can reach out to Bijan Tavazoie. I know some hard money lenders don’t do owner occupied homes though for some reason... he might have a work around or something though, it’s worth giving him a call! Feel free to message me on here or at my business number below for his business card information.

I hope everything works out for you! Keep us updated!

Regards,

@Akeem Moreno that’s awesome man! You’ll get your license in no time.

In regards to that property, I took a look at the ad on Craigslist. It could definitely be a good investment, but it would require A LOT of work. I’m betting 50,000 worth at least. Not to say it’s not doable though, but a bank wouldn’t lend you money for it. You’d have to get a hard money loan which will require 20% down. So let’s just say 50k in repairs plus 32k for the house equals 82k. So you’re looking at 16,400 down to your hard money lender, plus a lot of hard money lenders from my experience don’t lend on owner occupied properties.

If you can close on it you're looking at about 3-4 months of repairs probably. Keep in mind you'll still have to pay your PITI while it's been repaired with no cash flow from it. Once it's repaired, you can refinance it, possibly on an FHA, which should get you your down payment back plus a substantial amount. I don't know housing prices in that area, but I'm assuming after it's fully fixed up it'll be worth at least 150,000.

Before doing anything with it, I would get 3 estimates from separate contractors, a thorough inspection, and verify that the electrical and plumbing work was done professionally, and that there aren't any major fixes. Once you have that info, you can go to a hard money lender or a bank for a construction loan with a game plan, and actual figures. Make sure you get an ARV for them too.

All said and done you can take the money from the refinance and do the exact same thing again! It would be a big project for a first time, but it’s not to say it couldn’t be done! Just keep in mind things like rot, mold, bad foundation, etc. could pop up and substantially increase the repairs. 

If you do decide to take it on please keep me updated, I’d love to see how it goes and know the actual figures involved.

Regards,

Hey @Eman K.

I just came across this. I hope you've had a great REI Journey so far! If you are still looking into investing Portland feel free to reach out to me!

Regards,

Morning @Danielle Leahy!

    I'm buy no means in the know as far as Atlanta goes, I'm literally on the other side of the country lol... However, I would say that you should come up with a solid game plan of what it is that you are hoping to gain from Real Estate? Are you trying to gain financial freedom in the long term? Are you trying to get a few properties to set yourself up for retirement down the road? etc. 

    Once you know what you're looking for, ask yourself what the path of least resistance is to get there. If you're trying to build financial freedom, and get monthly cash flow, I would do the rental option (I am however biased towards Buy and Hold). If you're not going to be living there, and location isn't as big of a deal, then go where there is a good cash flowing opportunity, and find a solid Property Management company to manage the property for you. Then Refinance, and repeat! If you are in a market where houses are predominantly cheaper, and the market is growing, then maybe Flips are the way to go! Flips are great if you have deals available that make sense, and you are looking to gain more capital for bigger investments. 

The reason I don't like flips though, is because with flips you are creating a job for yourself. Once you sell it, you have to find the next property asap, or your cash flow stops coming in. With Rental Properties, you can build your portfolio as fast as you want, and you are constantly making more and more money each month as long as you are purchasing good deals. Those good deals can be the same deals you'd find for a flip, that's literally what the BRRRR strategy is. The difference is that those flips will pay you for the rest of your life, plus you gain equity build up from your tenants, cash flow, and any value the market adds. Then once you're satisfied with your monthly income, you can literally stop and travel the world, live on a beach, do whatever you please, or you can just keep going at whatever pace you'd like/ need. Then there are enormous tax benefits, etc.

The best part about rentals is that eventually those mortgages are going to be paid off, and you're not just going to be cash flowing 150-500 dollars a month from them. Not only will you have a home paid off by your tenant worth whatever the average house is worth in your area, but your 4-500 dollars jumps to 1,200 dollars or whatever the full rental price of that home is. Your cash flow literally doubles, triples, or quadruples, especially in MFR situations. Leaving exponential wealth for you, and the generations after you, or charities, etc.

This is just my two cents though. Go with whatever gets you to your end goal, and whatever makes you the happiest in the end, because really that is all that matters. :)

I wish you the best of luck with your journey, and can't wait to see your success stories on here! Like I tell everyone else, ask, ask, ask, and ask, and when you're so tired of asking your head hurts, ask some more. There are so many awesome people on this site that want to help you. People love talking, sharing stories, and experiences, you're in the perfect place!

Regards,

Morning @Akeem Moreno!

    I would first read 'The Book on Rental Property Investing' by @Brandon Turner. It's an awesome book that will help you develop a solid game plan, understand your financing options, and help you figure out where you want to start at first. 

    You have so many options ahead of you and the places you can go! You've got a great starting savings, and low debt, which is fantastic. I started with 42,500 in credit card debt, and 2,000 in my savings. Thankfully I have a great Engineering job and was able to spend 2 years paying off my credit card debt. In the meantime I read a lot of books like the one I listed above, got my Real Estate License, and got to work! 

I'm not sure what housing prices are like where you're at, I'm assuming not cheap, but I would definitely look into House Hacking first and foremost. You'll be able to free up a large chunk of money each month by not having to pay a mortgage/ rent, and if you play your cards right, you can even possibly have some cash flow on top of that. You can still use an FHA for anything up to a 4-plex, you just have to live there for 1+ years, and after that year you can refinance to a conventional (Fannie Mae backed loan) and use your FHA again! I just learned about that, you can use your FHA loan opportunity more than once, look into the specifics for sure, but I believe you have 3 years to use it repeatedly, as long as you are only using one FHA loan at a time, and it's your primary residence.

    If you do your analyzation correctly, then when you refinance your home each time, you are able to get any equity built up by your tenants, your original down payment (if you can increase the value of the home with some face lift work), and your cash flow generated from the property to use as a downpayment for your next one, and you can do that over and over again. 

    I wish you luck man! Keep us updated on your journey! We need all the success stories we can get on here, I look forward to reading yours! Don't stop asking questions. Ask, and ask, and ask, and ask. And when you're so tired of asking questions your brain hurts, ask some more lol.

Regards,

Morning @Donald Dye

Growing up in the building industry I would hold off. I'm not saying your contractor doesn't do fantastic work, but mistakes happen, and considering he will have nails, boots, hoses, nail guns, compressors, etc. down there, it is only a matter of time before one of those nails ends up under his boot and scrapes the laminate, or the compressor slides and leaves a nice big gash in your new floors. 

As @Kyle Mccaw said too, Vinyl Plank might not be a bad way to go, especially in a basement. If you have smooth, level floors down there, I would even consider just vinyl outright. Not only will it be waterproof, but 5-6 years down the road it won't shift and you don't ever have to worry about gaps, etc. Plus install/ materials should be easier, and cheaper than vinyl plank. 

Good luck though either way! Let us know how it goes!

Regards,

Good Morning Everyone! I hope everyone is loving the sunshine that has finally made its way here. Unless you live in the southern states, then I hope you are still enjoying it! 

I've recently received my Real Estate License, and I am extremely excited to get to work both as an REA, and in the world of REI. However, being new to both sides of the game, I would love the opportunity to work with an Investor Mentor.

My question is, what can I offer with my Real Estate License to an Investor that would make it a sweet deal for them, and me? 

I understand that as a Buyer, you are typically getting a Real Estate Agent for free considering the agent's fees are usually coming from the selling side. So offering an investor "Free" Real Estate services wouldn't really make a difference. But what can I offer an Investor in this scenario that would make it worth it, both for me to buy/sell his properties, and for me to have the opportunity to learn from him? 

Just to confirm, it is illegal for me to split my portion of my Real Estate earnings with an investor correct? I don't see why it wouldn't be considering sharing any fee with someone unlicensed is always illegal. Is there a legal loophole to this that I don't know about though? I wish it wasn't... then it would be a win for my Principal Broker, a win for me, and a win for the investor. We would all get paid, and I would get paid and experience. What if we entered into a legal partnership as general partners?

I would obviously confirm any action I wanted to take with both my Principal Broker AND an Attorney before following through. 

Regards,

Shane Short