All Forum Posts by: Timothy Smith

Hi Patrick, I'm also here in Buffalo. Who is charging you $11K in closing costs on a $140K mortgage? I just did a cash out refi that closed 2 months ago for $136K and my closing costs were maybe $7K, which was high as it was an out-of-area lender (only reason I went with them was no prepayment penalties and I don't anticipate holding this property very long). I think you are getting burned on the refi costs, but maybe I don't know the whole story. 

I have been researching 2nd mortgages on investment properties for a while and have yet to find a local lender willing to be in 2nd position. Perhaps your primary mortgage holder with allow a LOC on the original property?

@Account Closed good morning and welcome to our corner of the state! There are some great people and resources here. The market is insane right now and hopefully you are prepared to do some rehab work. Even the dumpy duplexes that need $50-100k or more are going high. Find yourself a knowledgeable and responsible contractor and go from there. Some of our toughest growing pains were in that arena, and I anticipate will continue as we grow! Best wishes and hope to meet up sometime. 

Looking forward to getting back to this. 

Hi @Kyra Waters - nice to meet you. There is a BP meetup the second Wednesday of the month (or is it first Wednesday? I haven’t been in a while) and it’s a great opportunity to network. I live and invest in the West Side and nearby. Feel free to reach out should you ever want to chat. 

@Ryan Sweet just saying "hi" as another Buffalo resident and investor. Khaled and Matt above are not only great resources but great people. They know the numbers investors use and know neighborhoods very well. I'm not an agent, but have a few years of experience living and investing around here, so if you ever want to chat, let me know! Best wishes. 

Great place if you are smart about neighborhood selection and feel confident with your contractors. Lots of old buildings that need maintenance so be aware of that at the outset! We’ve been successful here for the past 4 years, but we also live close to our properties. Khaled and Matt above are excellent resources, and upstanding guys. 

My main caution at the moment is to get up-to-speed on NYS laws and be wary of purchasing occupied properties without verifiable pro forma. 

@Kaja Baum, I'm happy to report to you that that's not how ASB construction loan works!! The reconstruction loan through ASB is a "one stop shop" so to speak. They appraise your property based on ARV, taking into consideration your scope of work. So, you know your ARV from the beginning. The downside is your only way to add value is aggressive appreciation. After your final construction draw, the loan converts to a permanent mortgage with no additional closing costs. No seasoning period as it doesn't apply.

I've done several of these with ASB and would be happy to talk offline if you would like. Just shoot me a message. 

Hi Kaja, you mention ASB and the rehab loan — there is no refinancing with this product, to my knowledge. The rehab loan is one closing (at purchase) then conversion to a mortgage once you take your last draw. Am I missing something?

Try Upstate Bank, as well. Haven't worked with them yet (due to their 54321 payoff penalty) but the terms are good — IF they take you on. I'm in the middle of working with AmeriCU out of Syracuse on a BRRRR here in Buffalo but they are moving sloooowwww. Nice product, though.

@Nicholas Bossert my condolences on your mothers passing, and also congrats to you for savvy thinking as a beginning investor. First of all, slow down! I agree with the others that you should finish the house hack that you've started. One, it gives you credibility and the learning experience is invaluable. Two, it's an asset free & clear of sentimentality.

The red flag that stood out to me is "...I love this house..." When I got into this game, it was hammered into me by a mentor that you must fall in love with the numbers, not the property, or the architecture, or the fact that it reminds you of your Nana's house. I get it -- I really do. But fall in love with the numbers and make your decision that way. Now, have I chosen some properties based on other factors than just numbers? Yes. Such as quality of structure, location, fitting our business model, etc. But in all of those cases, the numbers worked first.

I agree with an above point about showing your dad a successful investment through your house hack, then go from there. Showing someone how something works is often more powerful than explaining it.

This may not be helpful, but I have heard of situations where owners manage to have their own building qualified as "Uninhabitable" by the building and/or health department. Could invite a host of other issues, but depending on how big your renovation is, they might be things you are addressing anyway. Might be worth exploring, but could open you up to other liabilities. Just a thought, as we are all trying to be constructive with this mess.