All Forum Posts by: Edward A.

Are both scenarios interest-only or are they amortizing?

1. It's probably the norm if it's an older property.

2. I would check with the county/township first to see if you're allowed to bill back water to the tenants (some wouldn't allow this even if submetered). Also get in touch with a local property manager to see what they normally experience.

3. If the quads have good, long-term tenants and the water bill isn't out of control, maybe don't convert to coin-operated right away. Run the numbers as the quads are now. Figure out what your water/sewer monthly average is since as of now that is your responsibility. And see if the properties still look like a good purchase.

You might be better off adding rent escalation clauses to your leases (once they expire) if they aren't included already.

Not enough.

No you don't have to sell your property. And if you have a valid reason for moving (work for example), then you're allowed to break the 1 year requirement.

I think that's a question for the attorney! I'm guessing she'll most likely charge you. Especially if you're not an experienced wholesaler and/or can't demonstrate how you have a killer deal on your hands.

Yes. 

Keep in mind that FHA has a requirement to live in the property for a year before moving out. Not sure of the penalty for not obliging. But I know there aren't any rules on when you can refinance. So refinance whenever I'd say.

I'm sure though the criteria will be stricter on qualifying for a second FHA while keeping the first property. More reserves for both properties probably. Tighter DTI ratio. Etc. Depends on the lender too. Each lender may have their own rules as well.

If you have credit cards, keep the balances as low as possible. Also see if you can have your credit line increased for each card without them pulling your credit/hard inquiries. 

Achieving both of these can help your score in a few ways.

Also, keep your oldest account open. Keep making on time payments. Avoid opening up new accounts.

I would talk to brokers instead of bankers. Some might have the connections you need.

I am in a similar spot as you with FHA. I got all excited about my first purchase, I sort of neglected how I'd be able to buy my next property afterwards.

All part of the learning curve though. 

If I'm paying less than I would in rent, I'm happy. Others might have different viewpoints.

Make sure you run the numbers as if you weren't living there as well. Factor in property management in that case.

Looks like a decent purchase. Insurance may be different for you as an owner occupant. Will you be using property management at all? Might want to factor in 8% for that if so. Maybe factor in 10% for capex/maintenance for all three units instead of just the two.

And of course it also depends how you finance it. Either way, doesn't look too bad.