All Forum Posts by: Timothy Howdeshell

Hi BiggerPockets!

I've always loved reading success stories in business and especially real estate. I'm happy to have my own success story to share finally! I got interested in REI after reading Rich Dad, Poor Dad (just like everyone else...) around 3 years ago. At the time I was a broke graduate student, living in frozen midwest of Canada, studying for a career in science, and simultaneoulsy planning a way to escape the ensuing 9-5. I'm an avid reader, and am always really inspired by individuals who live outside of the norm, take full responsibility for their lives, and live extraordinary lives of purpose.

I grew up in Iowa, and had always wanted to move out West. So when offered a job in Denver, I jumped at the chance. I then started saving aggresively for the first year in order to build up an emergency fund of 6-12 months. By driving a beat up car (owned for 10 years), cooking for myself, and not going out as much, I was able to save up about 15k in a little over a year. Several of my friends are involved in real estate (realtors, brokors, and investors) in the Denver area, and through our discussions I became more comfortable with the idea of using some of this money to buy a place of my own. After some research into financing options in Denver, I came across CHFA, a downpayment assistance program, which was too good to pass up, so I immediately filled out the paperwork, started contacting lenders, and found an agent to work with. 

I closed on my property in April, a nice 2 bed/2 bath in Westminster with an unfinished basement. I put the extra room up for rent, and by May had a tenant covering half of the mortgage. I then began saving again to build up the cash buffer, and started planning for the basement finish. My income isn't extremely high, and I consider myself to be fairly handy. So I was planning to do most of the work myself. In the fall of 2017, I refinanced out of my old mortgage (the down-payment assistance came with a high interest rate on the overall loan, but no other strings attached; basically free money), and lowered the rate by nearly 1.5%.
 

I began with the framing in August of 2017, and finished the project in February 2018. After working my 9-5 in the evenings, and most all of the weekends, I was working on the basement. I would even spend my lunch breaks at work calling the permitting office, calling contractors, and researching building materials and methods. In the end, I had to contract out the rough plumbing, hanging doors, as well as the drywall mudding and taping. But for everything else, I did the work myself, and with the occasional help of a couple friends. This work included: drawing architechtural plans, concrete demolition, framing, electrical, insulation, HVAC, drywall, flooring, painting, plumbing, tiling shower, installing all finishes and hardware, and trim work. 

This work was very enjoyable, but extremely stressful. I was considering an opportunity out-of-state, and wanted to have the basement finished by the end of January in order to move. Therefore I was working like a man obsessed! I really proved to myself how much I am capable of, when sufficiently motivated. I'm not sure that I would recommend such an aggresive schedule however. In any case, I declined the out-of state opportunity over the new year, and then had a snowboarding accident which put me out of commission for a month in January. These two things slowed down my progress in the new year. 

But, I moved down into the finished basement in the beginning of March, and after a few weeks of advertising/tenant screening, found my second tenant for my old room. I am now living for free in Denver, with a sizeable chunk of equity in the property! 

Overall, I am extremely happy with how my first real estate endeavor went, and am very excited for the next deals! I am using the credit card rewards gathered during this time to partially fund a trip to the Dominican Republic in a month to celebrate and recharge. Upon returning, I am going to start saving, building, and planning for the next deal. 

Thank you very much for reading, and for letting me share my story. I wish you all great success in your REI!

(The after pics are a bit old, but give a good idea of how things turned out)

Great thread! For me, it started in college wherein I worked up to 3 part-time jobs in order to keep student loans lower. That being said, I still came out with around 30k (ouch!), but luckily after graduate school in science, I was able to get a decent job. Over the first year of work, I saved over 50% of my after tax income. I became interested in REI during graduate school (Rich Dad, Poor Dad coming through again), and so was aggresively saving for an emergency fund and 1st property. Being that I live in Denver, with its increasingly expensive real estate market, I realized that it would take another year or more before I could save enough for an entry level home. Offers for this market segment were going for 30k over asking, and still not winning! So I decided to look for alternative down payment options. I found that the city of Denver had grant programs for 1st time home buyers, and that I qualified. Next I found a starter townhome with forced appreciation potential (finish the basement to add another bed and bath), and using the downpayment assistance, I was able to afford my first property. I purchased/moved in at the start of May, and found a tenant for the extra room which covered half of my expenses. I am now in the process of finishing the basement, and once I move in (likely before the project is complete), I will rent out my current room and be living for free. I am doing most all of the work myself to save labor costs, as well as to learn general building skills. In the future, I think this knowledge will be helpful when dealing with contractors and inspectors. So I am currently doing a live-in-flip/house-hack for my first property. I feel that being frugal, along with some luck, has helped me be successful so far. I am fortunate to have 3 other REI friends who own several properties to mastermind with. Really I'm just excited for what the future brings!

I am in the process (close in 2 weeks) of buying my first property in the Denver area (Westminster to be precise). The advice that I have heard from real estate agents is to go with a smaller, local lender as opposed to the large lenders such as American Financing, etc. I had received pre-approval from the big guys, as well as some smaller ones, since I shopped around first. And while they were all very nice, I was persuaded to go with a smaller, local lender based on the advice of other investors in the area. Supposedly some of the larger ones have trouble closing, but your milleage may vary. Guild was recommended to me, and I actually ended up working with Cherry Creek Mortgage as I know someone who has used them to close on two properties over the last couple of years. 

Another thing to consider is down-payment assistance, if you qualify for it. Although you may have adequate cash on hand, there are some great deals out there. I was able to get a 4% down payment grant on a conventional loan, which doesn't need to be paid back ever, and the time required is minimal (<3 hrs work). It isn't free money however. In my case, the interest rate is set higher than I otherwise qualify for. But the break even point is 8 years, so the numbers made sense for my situation. Just something to consider. I hope that helps. Good luck!

Thank you for the warm welcome everyone!

@Matt M., thanksfor sending that article along! It was a great read, and pretty much where I am at as well. And yes, I abandoned the MF idea in favor of a rent by the room approach. I have had roommates my entire adult life, and while not the ideal circumstance, is just fine with me.

@Kevin Grinstead, thanks Kevin! I sure will!

@Kevin Hunter, thanks Kevin! I'm excited to be here.

@Bill S., thank you Bill! I am not as familiar with those strategies, so wil need to do some reading, but those sound like some great strategies to consider! The MLS properties seem hyper competitive at the moment, and so off-market may be the way to go.

Hello everyone,

I've been lurking here on the site for quite a while, but recently started listening to the podcasts (I've probably ran through 20-30 this week :-) ) and decided I should get more involved! Wanted to start off by saying thank you to Josh and Brandon for their great podcast and setting up this community, and also to all of the community members. I've gained so much through the blog and forums already. 

I'm a newbie living (renting) near the downtown Denver area. Like many people here, my interest in REI started after reading Rich Dad Poor Dad and a few other real estate books several years ago. I've always wanted to be self-employed. I just finished my master's degree in food science, and currently work as a food science professional. My cash flow was non-existent during school, and only recently have I been able to consider moving forward with this dream.

I'm currently looking for my first property. The original idea was to buy a multifamily and rent out the other units, however I can't find affordable properties of that type in my market. Therefore, I'm looking at single families and condos with which I can rent out some of the rooms. Due to the price of the local market, I would then like to expand into out of state buy and hold rentals.

If anyone has any tips on the Denver market I'd love to hear them! But really just wanted to say hi.