All Forum Posts by: Timothy Douglas

The second thing I think you should decide is how you want to get there? You CAN cash flow with turnkey properties, otherwise there wouldn't be turnkey companies. However, there are pros and cons to each. I don't really know them, but I'm sure the BP community will come help you out with that pretty soon here.

I would also focus on small multi-family to get to retirement. They scale a lot better, can increase in equity and cash flow pretty easily, and then you can get into another one. SFH are just not very fun IMO, but these are all your personal investments, so they should fit you personally.

Recap of questions you should answer:

How much money do you want to retire?

How do you want to obtain that money? (Stocks, Real Estate, Interest on loans, small business, etc)

How passive do you want your income to be?

How can you get it to be that passive?

EX: If you want 10,000 Dollars per month exclusively from real estate and SFH in Pomona, CA in Passive Income that only requires you to look at your mobile banking and see it deposited, you're going to have to build systems around whatever your passive income is. Property managers, maintenance people etc...

4 Votes

Originally posted by @George B. Washington:

Call Tools power Dailer. 1.6k leads! If you don’t cast your net and make calls you don’t catch any fish! Making calls is not my fear. The challenge is the needle in the haystack in getting Motivated Sellers on the phone. To that end , this has been my challenge. What’s been your success? @Steve . Thanks for your perspective and encouragement.

That's a great mindset! I guess my question is, how long have you been doing it? Are your scripts good? How many people have you called total? I would listen to the wholesaling inc podcast and figure out how they are getting their leads. My mentor was sending 1000 texts per day to close a few deals per month. You can go to batch leads and get plenty of lists skip traced for you if that's what you need. I would focus on a niche and just get really good there. Also, are you wholesaling? If so, might as well get your license because it opens up the people you can target! That's why I got my license

0 Votes

Charlotte, North Carolina

@Victor Steffen would be great!

0 Votes

Austin, Texas

This might be a strange thought and I'm not qualified to give advice on how this loan or deal would work, but you might be able to cosign a house-hack with somebody, split the equity and cash flow, and still capture the appreciation that you want. You'd have to find somebody that wants to live in Austin and that you trust enough to enter into business with, but it's a possibility. I've thought about it as a way to get into rentals with low money in the past.

0 Votes

Originally posted by @Account Closed:

This summer I'll be selling my home and moving into a new construction. The home I'm in is paid in full, so I'll be collecting the full amount of equity; about $225,000. I have a buyer lined up already and my new construction is on par to be done on time. I plan on using that capital to start BRRRR investing to build cash flow. My question is, should I tie up a chunk of my personal capital to pay acquisition/rehab or should I use loans to cover the costs? Thanks for reading :)

I would use as much leverage as possible because that's the beauty of real estate! You would also be able to cover the loan, but also have capital free for another property if you decide to up your risk. I would personally shoot for a BRRRR that is 5+ units and live in it because more units leads to more cash flow and a hedge against vacancy. You can also increase the value more simply by finding a vacant apartment and filling the units!

1 Vote

Originally posted by @Jacob Bohrer:

It has always been my dream/goal to get into Real Estate Investing.

Out of college my wife and I bought a SFH as a live in flip.

After 4 years my wife finally gets and and is all in with me on REI... so thankful for her!

We sold out SFH for profit in November with the intention to get into a small multi family to house hack.

Over the last 3 years I’ve seen so many good deals, but now that we sold our home and are all in I feel like there’s nothing good right now, it’s a little discouraging. (We’ve made multiple offers on a few but also are in not wanting to settle for a bad deal) I’m still 100% committed to this, and am going to try direct mail this month but do any of you guys have any words of wisdom or at least some words of encouragement during this season of seemingly unknown and waiting in our real estate journey? Thanks all!

This may sound ridiculous, but you could always 10x the number of offers you make. If you offered 60% price for every small multi-family in your area for 6 months straight, you might get a deal

1 Vote

Originally posted by @Michael C.:

If I’m paying I want my money to go to paying off the house, not into someone else pocket as additional fees.
I will pay more upfront to save on : fees, %rate, mortgage insurance… so on.

Get a loan estimate for each and see how the numbers work out.

If the 20% option has lower closing fees, lower %, and no PMI, your putting more down but technically it's cheaper.

Example-

3.5% down $300k- closing costs fees $8k, 3.5% loan, pmi 1% $3k a year. Monthly mortgage payment $1,343
20% down $300k - closing costs fees $3k, 3.25% loan, no pmi. Monthly mortgage payment $1042

FHA year 1 you only put down $10,500, but your whole down payment was swallowed up by fees and costs. You still owe $292k and pay $500 more a month than conventional.
Conventional Year 1 you saved $11,600 in fees and costs but had to put down $60k. Your loan balance is $238k, your payment is $500 less a month than fha.

Option 2 looks better to me, but to each there own.

Why do so many people recommend the 3.5% down? I guess it's just a really cheap way for people without money to get into their first investment? I guess if you can still cash flow it wouldn't be bad either

0 Votes

Originally posted by @Jim Piety:

@Timothy Douglas thanks. Yes, I agree that leveraging is ideal and I wouldn't do a HELOC or HE loan immediately. If it's a SFH that I plan to live in for a year before renting out, does that count as house-hacking?

@Rick Reeder, Yes, I plan to move in but it's more of a primary residence than a duplex. Although I am looking for a duplex if I can find one. But can you help me understand the 80-15-5 or 80-10-10 that you meant? I get the 80% loan, 10% down. Where does the other 10% come from? Private or hard money?

@Rick Reeder talked about this and I am just echoing this... You can rent out a room or two and live for free, or with a little bit of cash flow, and then rent out your other room when you move in a year and significantly increase your cash flow! That 80-10-10 idea is a great idea too! Learn something new every day.

1 Vote

Originally posted by @Jim Piety:

@Becca Summers What about a primary residence in a quickly appreciating market (Austin)? Even if it wasn't a primary residence, finding cashflow in Austin is nearly impossible.

If it's a primary residence, a house-hack makes it pretty easy to cash flow in Austin. Also, if you can find deals under market value and do the BRRRR strategy, you might find yourself forcing appreciation and being able to refinance out of the PMI you would get with the FHA loan.

0 Votes

All Forum Posts by: Timothy Douglas

Timothy Douglas has started 22 posts and replied 147 times.

Post: New on BP. Need advice on San Antonia investment properties

Post: Rent To Retirement How Does It Really Work?

Post: Finding Motivated Sellers

Post: Austin Investor-Friendly Agent

Post: Austin and its suburb rental homes

Post: Newbie investor needs guidance on BRRRR

Post: Advice for someone passionate about REI

Post: How much do you put down?

Post: How much do you put down?

Post: How much do you put down?