All Forum Posts by: Spencer Cornelia

@Edith Alvarado de Cortez one option is to buy a property in need of rehab using seller financing which would allow you to pay for the rehab using credit cards.  I would not advise using credit cards for a down payment.  It's unlikely a lender would lend on that scenario, but you're also setting yourself up with a lot of risk that may lead to ruin.

@Alipate Moleni let's assume the owner is completely against seller financing as it's currently being represented.

What if you were able to get a bank loan of 70% on its current value? $875k value would put the loan at $612,500. That would pay off his current loan and help him walk with $300k (on mobile and I think you said he owed $300k above).

He would then finance the remaining 30% at whatever terms you came up with. Let's say the $25k was not a down payment against the principal but a payment to him for seller financing.

The remaining 30% could be loaned interest free over 20 years. $312,500 paid down over 20 years would be $1,303 a month.

Why would the owner consider this? They get a huge cash chunk today. They get cash flow every month from a performing asset. And I'm assuming there will be some tax benefits by only receiving half of the equity up front.

What's the total monthly payment for their current loan, property taxes, and insurance?

This is going to require seller/creative financing so knowing that number is a great starting point.  Also, is this property listed for sale on a popular website like Loopnet or is this off-market?

@Dylan Eggers How much are you putting down?  What is the monthly payment?  How much rent will you get from each room?

In my eyes, you use this property to rent out the rooms, save up as much money as you can, and then figure out what's next.  The goal of house hacks isn't necessarily to cash flow when you're looking to move out.  The goal is to spend the next couple of years massively reducing your monthly expenses, thus massively increasing your net income.  The cash saved over those few years will help you determine what's next in your real estate journey.

@Joshua Rivera I host a Meetup in Vegas (Desert Rat Real Estate Facebook group) if you're looking to connect with people in this market. Casual, friendly, no-pitch. Generally 12-18 people attend.

@Joshua Rivera Fidelity National Title -- 500 N Rainbow BLVD #100 89107

I had a good experience with them and was referred by multiple people who have done a lot of deals with them.

@David Lowe would you have any interest in renting by the room to long term guests? It would be management intensive but highly lucrative financially.

I have a 7 bed 5 bath house hack in Vegas and it's a cash cow.

@Account Closed I was in your shoes a couple of years ago so I know how difficult this sounds, but your best plan of attack if you were after a great cash flow house hack would be to buy a distressed house in need of work, take over the payments from the owner, rehab with cash and credit card (or borrow from parents/friends), and then rent by the room.

I spent about 15-18 months learning and networking before I purchased my first property.  I recommend it to every person entering this game.  Spend every chance you can listening to podcasts and all the free time you can meeting up with local investors.

I personally think every beginner should be aiming for seller financed deals because that may be their only option and it's a really valuable strategy to learn as it's significantly easier to buy properties when you don't have to play by the banks' rules.  I recently made a YouTube video about how I purchased my 4plex using seller financing.  My channel name is my full name.  Don't feel obligated to watch but it may be helpful.

If I were you, I'd start today by finding every local investor meetup you can and going whenever they meet.  Use the search bar and find local investors on here and message them too.

@Account Closed You're looking for houses that will cash flow in San Diego with I'm assuming a low down payment after 10 years of wild appreciation in one of the most desirable places to live in America...

Your head is in the right place, but maybe we need to temper expectations first.  As an example, let's say your options to rent are going to cost you around $1,000 a month for a room and another $200 a month for any various utilities.

If you "house hack" and get your living expenses down to $200 a month total, you will be saving $1,000 a month.  $12k a year cash.  That's a huge return.  Sure you aren't technically cash flowing, but your finances are in a much better position than renting.

Me personally: what I would do is find a 5 bed house in a nice area where the seller is willing to do some sort of seller financing.  Furnish the rooms and then rent by the room.  $750 a room total gets you to $3k a month cash.  That would probably cash flow or break even at the worst.  I have a house hack in Vegas that cash flows around $1,200-$1,400 a month after all my living expenses are covered.  It's a great way to get started in this game.

@Cynthia B. I use Facebook Marketplace and Craigslist.  You can also check out Roomster even if you aren't technically looking for a roommate.  I prefer Facebook Marketplace because I get a lot of interest the second I post a room available.  And also because I can scan through their Facebook profile and get a good idea of who they are in a few minutes.

I only look for roommates so my experience may be slightly different than yours as it sounds like you're looking for tenants at a property you won't be living in.  But I still think Facebook Marketplace is where you should be posting your available unit.