All Forum Posts by: Account Closed

I think HOA's are covered in most states. As there are shared ownership parts of HOA's like common areas and expenses, in many states they are paid just after property taxes but before anything else except maybe a mechanic's lien.

I don't know the answer specifically but I believe that Chad offered a solution that might help you whether the bank can or can't.  If this credit drop is urgent to recover, I'd be proactive and call the lender/servicer and see what you can do to make this go away.  In the end that fixes your situation whether the bank is in the wrong or not. 

RE HELOCs, there's a ton of info on the internet about how people use these to pay down debt quickly. It basically works out to you using the HELOC as your primary account and having all of your money go into paying down the account while you draw from the account when you need money in your checking account to pay bills. This helps to further reduce interest and the thought of having to pull money out (borrowing more) is said to have a dissuading effect on people and the tend to become a bit more frugal.

If you're interested just google it and there's tons of info out there on the process. I've not done it and my one criticism is the risk of interest rate increases, but if you're contemplating a HELOC anyway, you should probably read up on this a little bit as it may save you even more money.

I have to agree with John's leaning on this.  Appreciation is a much longer term game than 6 months and if you made money on the deal due to appreciation alone, you got extremely lucky due to the short time you held it.  

One other obvious impacts on real estate appreciation for rentals is when there's a market shift in income expectations from other forms of "safe" and "semi-safe" investments.  For example when the bank CD and quality bond markets were paying 1% or less, inventors are happy to make 5% on a real estate investment (meaning paying so much for the property that their net anticipated return is only 5% of what they paid).  So as the safer earning sources have their returns rise there's a little bit of an inverse relationship with the rental markets property values as investors expect a higher return which often means a lower price on the property.  

Also, the double whammy of real estate investors paying more for interest on property investments puts additional downward pressure in markets like this (and upward pressure on prices if the interest rates start to recede).

I saw it mentioned here before that it's incorrect to write off one tactic or the other without first paying attention to the goals.  For example if I was 25 and anxious to hit a million before I dinged 30 then maximizing cash-on-cash might be my main KPI.  At 65, I'd likely be more focused on the sum of the cash flow or maybe just the Cap Rate in general.  And in between it could be a combination of matrix with varying weights of importance.  

Also for those discounting $100/door as Sub-Uber labor, I believe the goal with real estate is passive cash flow.  If you're working more that 10 hours a month per door, then I agree that $100/door is way too low to mess with unless you just need a job. 

I think the cost of living might, over time, start to sway some of the work from home crowd who have begun to expand the distance of home considerably over the last several years.  I mean who wouldn't want a nice $70k house that's only a few miles away from a small town filled with nice people.  I think over the next decade or so as technology allows many workers to work from anywhere, that many of the reasonably priced mid-western towns might find themselves benefiting.  Also, I've seen several pop up on miscellaneous "best places to retire" as well due to affordability.  

The bad news is that Trump doesn't technically own the White House so if does go bankrupt that won't help you get it.  The good news is that the US Government owns the White House and it's in worse shape than Trump so there's a chance. 

Are you able to use funds from a HELOC as a down payment for another mortgage? I know they've loosed the sources of down payments over the last several years but using debt as a down payment used to be a no-no.

I think the answer to your question lies in what you really want to do?  Do you want the safe return or are you wanting to risk some of what you've earned so far to get more?  When faced with those situations I like  to envision the worst case scenario and then ask myself if I could live with it.  If so...jump.  If not take the safe route.  

The market has been really good for a while and housing in many areas is starting get near the unaffordable level for the average family.  Test the math of your plans with a few years of price reductions and/or stagnant inflation and see how it works and if you'd be OK.  

I loved his method of using "cash for keys" to get rid of bad tenants.  Sounds so wrong to pay off a bad tenant to leave but is probably 5 times cheaper than booting them the hard way only to find your assets destroyed.