All Forum Posts by: Tyler Silverman

Thanks, everyone for chiming in, even on my post from over a year ago! I had to review this post to remember what I was saying. Long and short: I ended up getting a general inspection and not purchasing the property. There were too many things in the inspection report, and the property was already a stretch price for me. Before investing in other areas, I had bought two properties in my local area. It was/is a lot of ground-up and up-front work, but I have learned a lot (both successes and mini-failures) and am currently happy with my out-of-state properties. Again, thanks all :)

Hello, what needs to be done? Do you have pictures or more info to share?

@Colleen Prescott I just closed on my first OOS property today. I also read that article a day or two before closing, and it wasn't exactly what I wanted to read!! But given the general disagreement with that author's article within this community, I think it does at least serve to remind one that OOS, just like local properties, requires work and building a team and well-lubed system. For me, I've realized and accepted that I'll still be working on my new OOS investment for quite a bit before it's more streamlined. Challenge accepted!

I'm in Denver and real estate investing here is tough too...it's either prohibitive or a challenge beyond what I know how to do effectively...but considering even though what was written in that article may in parts apply to my new purchase, it is still cheaper with good positive returns than trying to invest in my local market.

Best success!

@Sam Rust - Did you transition from I&C Automation to REI? Or are you perhaps another Sam Rust? Anyways, congrats on the deal!

Not exactly. I might not have been clear...I did not have PMI in my case, I just meant to advocate that I would get rid of it ASAP, if possible, as it increases equity and cash flow if renting. In my case, I used cash to pay down the note while I lived there before renting it out and before getting the heloc. My intention back then when I was living there was not to save up to buy something else but rather to reduce paid interest. When I converted the property to a rental, I stopped paying extra principal and was able to open a good-sized heloc. You are right that less cash becomes available when opening a heloc but on a positive note, I am okay with that now that I have a tenant in there paying. Now my portion of principal is now much more than my interest portion each month while having access to the good-sized heloc whenever I find an investment that produces higher returns than my interest rate.

@Account Closed - Cool name btw. As a first step, I myself would definitely throw everything I could to get rid of PMI. If you consider yourself responsible (sounds like you are with house hacking and being able to buy a property), PMI is just horrible. Get rid of it if you can.

In my journey, I used cash flow to pay down the mortgage. It allowed me to then get a HELOC (I had to wait a year or so to get sizable equity), and I was able to "recover" some liquidity from me building more equity with early payments. On my property itself, my interest rate was so low that the tax returns at the end of the year and only getting 25%ish of it back (my tax bracket) was not extremely interesting; it was a no-brainer for me to contribute extra cash toward the note and aim for getting the HELOC. Now I've "recovered" that liquidity and now that my proportions of principal and interest (PI) every month is much more in my favor than the bank's favor, it's just like having saved up all this time to go out there and buy another property. Good luck out there! :)

@Kenny Dahill and @Ali Boone - It's a triplex that is already rented out...more of a turnkey, simple transfer of ownership, and not a fixer-upper (that's the intent, anyway). It's an older building (from the late 19th century), and I thought about getting the sewer main video scoped in addition to the standard inspection. From my visit, we did notice some attention to the roof (small patches in place) and a slight water intrusion in the basement. 

Thanks, David. I've read it twice, it's great. Also open to additional ideas are out there. Good idea, though, I'll read it again :)

I am curious if anyone has experience with the inspection process for out of state investors (newbies) that cannot be on site during the inspection. Any general tips for the due diligence process for a first-time OOS rental property buyer? 

Thanks, everyone :)

Hello to all the BP people,

I am trying to land an OOS (out of state) deal but need a little input from y'all. Here's the scenario:

I made an offer for $350k to buy an awesome triplex listed at $400k. The seller's counteroffer was $390k and requested 2X earnest money than in my opening offer. The triplex has been on the market for 90+ days, has had very few showings in that time, has already seen a $10k price reduction a month or so ago, and it's fully rented out in a downtown area. To me, it seems like a good deal (without the inspection/appraisal results). I can't seem to get a sense on if the seller is really motivated or if he or she is just fishing for a higher price. Oh, by the way, the county has assessed the property at $366k (2017). I don't think it's smart to accept a counteroffer and bank on the inspection and appraisal reports to come in and allow for a rescinding opportunity. 

The investment performance numbers don't work for me at above $360k and know that that is my rock-bottom number.

Any tips on how to negotiate/counteroffer on the first seller's counter (this is my first OOS offer)? I might present my rock-bottom price and if no deal is made, then that's that...maybe try to come back in a couple weeks (zero showings and 90+ DOM). There are always other awesome deals out there to pursue, right? :)

Thanks BP!