All Forum Posts by: Stephanie Cabral

@Jeff Onofrio - you have to give us the link to that podcast...19 days??? I honestly can't imagine how it got through so fast!

Hey Joshua, I’ve done a full and a streamlined 203k. Even though the streamlined isess paperwork it’s still pretty annoying and So i don’t think the streamlined is worth the extra headache but the full 203k absolutely is because you are making much bigger changes to a property and can more drastically force appreciation. The 203k loan is a perfect way to get in the game. The loan doesn’t require previous experience as a landlord or experience with rehabs because you have a consultant help you with the (very tedious) scope of work and they evaluate whether the work is done properly at the end of the day. After a 203k, you’ll have renovation experience which will help you going forward. 

I started with a 203k and strongly advocate people use this method to get started but what you heard about the loan being a pain in the a@@ is completely true. Plan for a 2-3 month approval process (or more) and just try to keep in mind it’ll be all worth it in the end.

If you have any questions as you progress, let me know!

It sounds like you have a lot of options and they're all good possibilities, but if you're willing to refi your current property and move to your next one, you should seriously consider doing that, assuming you'll still be financeable for conventional loans. Conventionally financed investors are more competitive because the deals will cash flow better than other investors that are trying to make the numbers work with commercial loans. So if you refi into conventional, then you can use another FHA loan with the 3.5% down and your 10-15k will go farther than if you were trying to put 20% down. Plus, you'll have more certainty when buying with the FHA at the outset rather than the brrrr method where you rely on the appraisal to come in.

Something to keep in mind when you select your next property...If you're going to do another FHA loan, you'll have to demonstrate that you'll be owner occupied in this next property as well. If you go from your current duplex to another duplex, there will have to be an explanation as to why you're moving. Better school systems, more space, better amenities, etc. If you're going to a single family home then you don't have that consideration.

Hi all, please join us tonight for the Greater Hartford, CT REI Meetup.

We'll meet at 7pm at the Wood N Tap in NEWINGTON (for this month only), pause for introductions at 7:30, followed by more mingling.

Everyone's welcome, from newbies to the seasoned investor. To get the most out of the meeting, come prepared to share your experience, what you're looking for and what you can contribute.

The meeting is free but I do ask that you buy a drink or some food (or both) and take care of the server so the restaurant will continue to let us reserve and use the back room for free.

If you're in the following areas, this might interest you!

Glastonbury, East Hartford, South Windsor, Manchester, Vernon, Hartford, Rocky Hill, Bloomfield, Wethersfield, Newington, Middletown, Berlin, Bristol, New Britain, West Hartford, Farmington, Simsbury.

See you tonight!

Hey Charlie - I use Coe Bancroft at State Farm in Glastonbury. He's been my go to insurance provider because he can also insure rehab projects. I've also used Mazzone Insurance out of Avon and really like them but they don't do rehab projects. Good luck!

Hi all, due to construction at our usual spot, we're moving locations for the month. Hopefully we'll be back home in March. Please make sure to save the new details, as we're meeting at the Wood N Tap in Newington at 3375 Berlin Turnpike, Newington, CT 06111.

As always, the format is as follows:

We meet at 7pm, pause for introductions at 7:30, followed by more mingling.

Everyone's welcome, from newbies to the seasoned investor. To get the most out of the meeting, come prepared to share your experience, what you're looking for and what you can contribute.

The meetings are free but I do ask that you buy a drink or some food (or both) and take care of the server so the restaurant will continue to let us reserve and use the room for free.

I hope to see you there!

Stephanie

Hi all, HAPPY NEW YEAR. Put these important dates in your calendar and join us at the upcoming Rocky Hill/Greater Hartford REI Meetups:

• Wednesday, January 24
• Wednesday, February 27th
• Wednesday, March 21st
• Wednesday, April 18th

As always, the format is as follows:

We meet at 7pm at the Wood N Tap in Rocky Hill, pause for introductions at 7:30, followed by more mingling.

All investors are welcome, from newbies to the seasoned investor. To get the most out of the meeting, come prepared to share your experience, what you're looking for and what you can contribute.

The meetings are free but I do ask that you buy a drink or some food (or both) and take care of the server so the restaurant will continue to let us reserve and use the back room for free.

If you're in the following areas, this might interest you!

Glastonbury, East Hartford, South Windsor, Manchester, Vernon, Hartford, Rocky Hill, Bloomfield, Wethersfield, Newington, Middletown, Berlin, Bristol, New Britain, West Hartford, Farmington, Simsbury.

I hope to see you there!

-Stephanie

Hi Dexter, a few thoughts here. Just b/c you have a lease doesn't mean you can't owner occupy.  If you find someone to take your place (and you'd have a few months to do that since mortgage approvals take a while anyways) then you'd have no continued obligations to your landlord. That way you can take advantage of the owner occupied down payment options that @Jason A. mentioned above. 

***Food for thought: if you want to grow in the future using house hacking and eventually buy a duplex, tri, or quad, you might want to consider starting with a multifamily as your first purchase b/c, when applying in the future for owner occupied loans, you'll have to convince the mortgage company that you will indeed owner occupy and they're skeptical about borrowers that are going from single family houses to multifamily houses. Not to say you couldn't do it, it's just an additional obstacle. Ideally, you'd start with a 4plex, then the next year, buy a 3, then a 2, then get into single families. For that scenario, if you can come up with 5% down, then go the conventional route rather than FHA so you won't need to refinance before you can buy your next one (you can only have 1 FHA loan at a time).

Another reason I like the idea of starting off with a bank rather than hard money is because the banks don't require you to have a track record as a landlord to lend to you. Looking for partners when you haven't done a deal yet can be really tough.

But, since you mentioned hard money...you mentioned the property doesn't cash flow with a hard money loan. That's not uncommon and I don't let that deter me from a deal, as long as it cash flows to my standards once permanent financing is put in place. That being said, if you're using hard money, you want to REALLY make sure you'll qualify for a mortgage because you'll NEED to refinance. Get yourself preapproved by 3-4 banks and then don't do anything major to change your finances during the 6 month seasoning period. 

Hope this helps. 

Hi all, please join us tonight for the Rocky Hill/Greater Hartford, CT REI Meetup.

Tonight is our last meeting of the year and we're doing something a little different: I'll be there at 6pm with anyone who's interested in discussing the FHA 203k loan. If you've done a 203k loan or worked on one in some capacity and would like to come and share your experience, or are interested in learning about the loan as a borrower, you are welcome!

The regular meeting starts at 7pm at the Wood N Tap in Rocky Hill, pause for introductions at 7:30, followed by more mingling.

Everyone's welcome, from newbies to the seasoned investor. To get the most out of the meeting, come prepared to share your experience, what you're looking for and what you can contribute.

The meeting is free but I do ask that you buy a drink or some food (or both) and take care of the server so the restaurant will continue to let us reserve and use the back room for free.

If you're in the following areas, this might interest you!

Glastonbury, East Hartford, South Windsor, Manchester, Vernon, Hartford, Rocky Hill, Bloomfield, Wethersfield, Newington, Middletown, Berlin, Bristol, New Britain, West Hartford, Farmington, Simsbury.

See you tonight!

Hey Brian, I've experienced this. As you accumulate more properties, your DTI is most likely going to be negatively affected, even if you're cash flowing. That's because underwriting standards only take 75% of the income into account and presumably your tax returns are showing deductions. I've dealt with this by switching over to commercial loans. They're actually easier to qualify for because they look at the asset's performance. I've had some commercial lenders also look at my global debt service coverage ratio, but they don't reduce the income by 25% so my numbers are much better when a commercial underwriter is evaluating me than for a conventional loan. I recommend talking to a few commercial lenders in your area that you'd like to work with (prioritize the smaller banks, you'll get better service) and ask them in advance what their criteria is for debt service coverage ratio and the percentages they use in their underwriting for vacancy, reserves, management, etc and how much flexibility there is in those numbers. For example, I have a lender that requires less capital reserves on a completely renovated property than one you only put a few dollars into and it'll need some work soon. If you don't know off hand what percentages your local lenders will require, talking to them to find out is critical to the success of your exit strategy because you'll want to know how that the property fits your local lending criteria. Hope that helps!