All Forum Posts by: Steve J.

Hello BP,

My parents have agreed to sell me their house. The value of the home is $125,000 and they owe $35,000. This will be an investment property, it’s located in NJ. I tried to do a “Gift Of Equity” loan but the lender I was working with told me they can’t do that type of loan on an investment property. Are there any lenders in New Jersey that are willing to do a Gift of Equity on an investment or are there other creative options that we can do here? One thing I thought of is partial seller finance, where I get a loan for $50,000 and pay my parents directly the $75,000 but am having trouble finding a lender that will do a $50,000 loan. Any help would be appreciated.

Thanks

Hey BP,

I have what can be a great deal but am hitting a road block with financing. My parents are looking to move, and are willing to sell me the house. They are open to doing seller financing, however there will be about $35k left on their mortgage balance at the time they want to move.

The house is worth about $130k and can get about $1,200 in rent as is. The basement is partially finished, so if I finish the basement I imagine rent could go up to at least $1,400. I’m sure they’d sell it to me for far less than it’s worth which is why I want to find a way to make this deal work.

I don’t want to pay $30,000 to pay off the mortgage, and then pay them monthly through the seller financing. I’ve considered taking the mortgage over which is about $1,200 monthly but that would throw off my numbers and potentially trigger due on sale.

Any ideas on how I can make this deal work and still be profitable?

The fact that I can get it for far less than it’s worth, and have seller financing on the table makes this a can’t miss for me.

Thanks,

@Bradley Sriro

The lenders I've spoken to will require at least 15-20% down on multi family with a conventional. An FHA will allow me to put low money down on a multi family. They will let me put 5% down with a conventional on a SFH but not multi. The next one will most likely be in GA then the third one I may go to FL.

Hello BP!

I am currently house hacking a SFH which I used a conventional loan for. I am coming up on 1 year, and keep hearing that we are at historically low interest rates so I want to make my next deal ASAP. My plan for my second deal is to buy a small multi family with an FHA loan in the upcoming months that I will again house hack.

Thinking ahead about 12-18 months after this second deal is complete, for my third deal, I want to house hack another small multi family. Since I can only have one FHA loan at a time, I believe I will have to refinance my second deal after 6 months to get out of the FHA and switch to conventional?

If that's the case, will my interest rate go up? Does that mean I should run my numbers for the second deal with a higher interest rate than I'll actually get with the FHA (assuming it'll increase once I refi into conventional)? Will I have to make any additional down payment when I refinance? Am I thinking about this the right way? Am I missing anything here?

I appreciate any guidance/advice you guys can give me. Thanks in advance!

Hello,

I’m interested in buying a single family rental in the Orlando and surrounding areas. Are there any agents on here that want to connect?

Thanks,

Steve Joseph

Hello BP,

Does anyone know a PM in the Atlanta area that would manage by the room? I called and asked a few places but have not been successful in finding one. Please let me know if you know of any.

Thanks

Hello BP!

I’m a newbie, I purchased a home warranty for my rental, I got the everything plan! Prior to this, I was allocating 10% for capital expenditures every month, and 5% for regular house maintenance. Given that I now have a home warranty can I cut down on my cap x and maintenance monthly allocations or scrap it all together to increase cash flow?

Thanks

@Christopher Smith

Thank you, so are you saying I can write off expenses even if I do not have a business entity?

Hello BP,

I am house hacking a single family and living in the basement. I hired a PM for the top unit, and they are requesting my social to report my rent income so it can be taxed. Since I am house hacking and this is my first property I didn't consider opening an official business such as an LLC. However since the PM is saying it's required I'm wondering if I should do that now so at least I can write off some expenses. Should I push back on the PM since it's a house hack or should I look into forming an entity now? Any advice would be appreciated here.

Thanks

Hello BP,

So I made my first deal a few months ago which is a single family I will house hack. There’s a finished basement that I will live in.

I made a mistake and accepted tenants upstairs that I shouldn’t have accepted. Two days after they moved in, she texted me saying there was an “infestation” of roaches in the house but when I bought the house a month ago there was an inspection done which said there were no pests. I asked for a picture of the “infestation” and she sent me pictures of 3 roaches. . she is also complaining about the drainage of the water in her tub. My guess is that she brought roaches with her while moving in but per the lease I am responsible for pest control. I know I have to take care of the “slow water drainage” but since I have an inspection dated less than 2 months ago that states there were no pests, and I am certain there weren’t, can I make her handle the roaches she brought?

Secondly, I worked with an agent on finding tenants instead of a true PM which was the worst decision I could’ve made. This applicant listed her employer as out of state and initially had her income below the requirement. When I asked my agent about this, she went back to the applicant who explained her employer is headquartered out of state but she works in a local office her and she “made a mistake” on her income. She corrected it, and the “correction” put her above the minimum requirement. Today in conversation with the tenant she said “I haven’t received any pay in 3 months, and have been living off savings”. I sent an email to the agent and asked if there was any verification of employment or income done and she responded that there wasn’t. They only did a credit and background check.

As it stands now do I have any recourse against the agent who brought this applicant to me? I do not think she will be able to keep up with rent as it was a hassle getting the security deposit and first months rent but at that point we already had a signed lease so I couldn’t back out. Initially I was going to self manage but given that this is a “problem tenant” who complains, makes excuses, lies, and probably doesn’t truly meet the income requirement I’ve decided to hire a PM now in case an eviction happens.

I was excited to get started but had no idea that tenants can be like this. I am trying to stay positive but am concerned that I’ll be in a basement where the tenant upstairs is dirty and has roaches that will probably seep into the basement as well. Just looking for some advice on the whole situation here.