All Forum Posts by: Terron Winn

Good morning all! Happy Monday. 

I Hope you all dont mind that I continue to document my Journey here to share in hopes to gain some great tips and or tricks from the PROS!

This Morning I was informed by @Jesse Hinaman that I am able to remove my MIP; however I have tried in the past and I was denied due to LTV ratio. However; I called again this morning to Harass BOA to demand removal :) It should take between 5-7 business days to receive a response via mail about the decision. (I guess it doesn't hurt to request again).

Again, my initial plan is to go conventional early January 2017 and then pull out equity to purchase a upgraded home for my family and then rent out the first one. Does this seem to be a good idea? 

@Dan H. gave great information on why keeping my investments in San Diego makes sense and he gave great facts on why; and I agree. That is my first plan of attack; purchase here in San Diego. (Lakeside, El Cajon, La mesa). . 

Am I on the right path?

@Polar Prutaseranee

I do not want to go out of state, I would  rather invest here in California. I would like to be able to purchase another upgraded primary residence here using the equity from my first place and rent it out.The market here now is so high, I am scared that I wouldn't qualify for a home at the median price range.  I just do not know that if the capitol I have would allow me . Investing here will be my first attempt though. 

@Dan H.; I was too. I guess it varies from Lender to Lender on how and when the PMI gets dropped off. I even visited the HUD website just to verify because I know that I am throwing away money paying this. My lender has told me to either pay the 15K or wait for another 10 years for the principle to reach the ratio.

My thoughts are to refi out of the PMI asap!(which I am currently working on). Paying down the 15K wouldn't be an option because I would still be in a FHA loan right? And being in a FHA loan I would not be able to rent out the property unless I have good reasoning like : growing family, moving out of town, deployment and I am not under any of that.

My first attempt to growing will be to try out San Diego and see what I can be qualified for. It would be much easier and less of a headache to maintain the first property here in California IE: maintenance, Property Management. 

It does make since to pay the 15K because it will not be lost. 

How do you feel about purchasing a property here in today's market being so "hot"? Are you afraid of the economy turning for the worst like it did in 2008? There is so many videos/articles of how were headed for another collapse. 

You are awesome Dan!

Welcome Anthony, 

We are glad to have you on board! Im sure the answers and or guidance you seek will be found here. I have stumbled upon this site and I am glad that I have because there are so many knowledgeable people on here that is willing to help. 

I too am looking for residual income so I can leave the 9-5. Thus far, I only have my primary  residence that I bought in 2011; currently I am holding so much equity in the property and no I am ready to unleash it and purchasing new rentals. 

Again, welcome. 

@Dan H. 

@Tom Ott

I am still paying PMI because according to BOA I still am short like 15K of principle. They are basing the LTV off the original purchase price and not the equity it gained since purchase. I have tried to rid of it plenty of times with no prevail. Remember I am still in a FHA loan and in order for me to rent out the house that i am in now, I would need to refi out of it which I am currently working on now.

I love my home In El Cajon,(3 bed two bath; 1380 sqft)  however, I think it's time to upgrade to a bigger place.  I currently make about 50K a year and obtaining a new loan at the market prices for the houses I am looking at does not seem obtainable. Median house prices now are about 500K and I am weary about qualifying for that amount, even when the first house is rented out. 

I would love to be able to keep my investments close by but can I with my current income? Investing elsewhere would not be as favorable as San Diego but I would still be achieving residual income. 

Over all, my goal is to be able to replace my paycheck from work with real estate investments and be "free". 

Let's trade places for a second, what would you do being in my situation? 

Thank you 

Hello 

@Polar Prutaseranee 

@Dan H.

Thank you for the response I received from you . Its truly appreciated and I feel welcomed as you two took the time out to write me. 

I understand that it can be more risky by investing out of state but it makes financial sense for me in my opinion. To start off, I was really fortunate to purchase a home in 2011 for 209k. I was only able to afford just about that much due to my DTI ratio. 2016 I will only be able to pull off a loan amount of about 300k and that is not saying much for a home here in California. However, my home is now around 385K and I only owe 180K. Now I have about 200k in equity and I don't know how to start using that to generate more income. I have a few scenarios that I have been thinking about and I would like to share them with you to see if I may be on to something.

1. Refi my first house to go conventional and rent it out for about 2000-2100 per month. Currently I am paying 1430 (w/compound account) with FHA but after dropping off PMI and getting a lower mortgage rate I estimate it to be somewhere about 150 per month lesstherefore profiting about 600-700 per month. ( I live in a community and other homes rented for 2K (and they are smaller in size). Once that is done then I would buy myself a new home in San Diego California if DTI would allow me to.

2. Second option would be to Stay in the house that I am in and take out some or all or most of the equity and invest out of my backyard by purchasing and holding not really flipping because I am still a newbie and I know there are major risk in doing that especially if you are not present to view the progress. (I am no stranger to risk, I play penny stocks and they have been not doing so well. Some time ago, I even bought my x wife a new car that was she totaled the following month!). I have been looking into a company by the name of investibility.com and they actually have homes that are “turnkey” with tenants, and property managers already in place and you would receiving cash flow at purchase. Yet, in my opinion the homes are a little over market price but I can see why since everything is already in place for you. The yearly cash flow, Net yield, Cash on cash and the gross yield is already estimated for you. I have seen some that I would be able to buy using my equity from my home here in San Diego.

3. Third option would be to sell the house take out the 200K and put it towards the new house in San Diego but I would be losing a property and I really don’t want to do that. I have Kids that I want to build a portfolio that my kids can take over when they are older.

Again, I would love to keep my investments here in San Diego and that will be my first endeavor but if it doesn't work out I will have to look elsewhere. With the way the market is now do you still think San Diego has more room to grow? I know the equity won’t grow as aggressive as it did a few years back but do you thinkI can grow still?

Sorry for the Novel 

@Michael Sato thank you

Hello all, 

My name is Terron and i have a background In Business Management with little to no experience in Real Estate investing. 

Currently I am living in my home that I have purchased in 2011 and now it has accumulated about 200K in equity but I do not know what to do with it. I would love to be able to buy and hold or flip a house; however, the county that I live in is really expensive and my income from my job wouldn't allow me to purchase another home in San Diego at the market prices they are at now. My thoughts are to look into another state for a buy and hold or a flip and eventually work my way back to being able to buy in my own backyard eventually. 

What I hope to gain from being a part of the bigger pockets family is knowledge and to be able to meet some great like minded individuals.