All Forum Posts by: Timothy Ocampo

Hey Guys!

In a bit of analysis paralysis I believe, my family and I own 13 lots down in Jacksonville, NC. I just built a house last year and have it rented out for long term use and we are looking to likely develop the rest of the lots sooner than later. The home that I built was financed using HELOC's which is fully paid off and cash flowing $1550 a month.

I am a realtor but have no real experience in the commercial development side so I'm not sure if there is upside to trying to build maybe 3 or 4 homes using a commercial loan or would it make more sense to do construction to perm individually? Or maybe even trying to build off lines of credit whether that be business or HELOCS. I know the concept of pulling the equity as well eventually but I've been told I have to wait 6-12 months to do a cash out refinance based on ARV otherwise it would be based off the cost to build ($200k). We also could likely use the land as part of the downpayment for either scenario but I'm not entirely sure how that factors in either.

House: 3 bed 2 bath 1540 sqft 2-car garage

Cost to build is roughly $200k

ARV: $265k

Monthly Rental income: $1550

Each lot is worth:  $20k (Owned free and clear)

Build time: 6-7 months

So roughly looking to build 4 houses: $800k with a total ARV of $1,060,000, downpayment of $160k, and cash flowing $6,200 a month. The part of unsure about is how to run the construction numbers.

If there's anyone that could help give me some advice/talk things through I would be extremely grateful. If there's any other numbers that I need to provide to get better advice please just let me know and I can provide as much as I can!

So my parents have a rental property that they have been renting for the past 10 years, it was their primary residence for 12 years prior to renting. But now my brother and I have moved into the house with some friends from college and are renting it from my parents. They have been looking into refinancing the house and were wondering if they can/how they can refinance it as a primary residence. Their names are on all of the utilities now, been almost a year.

Would they be able to claim it as a primary residence because they have actually family in it? Or do they themselves have to be living in the house?