All Forum Posts by: Account Closed

A warning for new and old investors out there in case you're looking at the same property. Beware the FSBO listing at 674 Baffin Island Rd in Henderson, NV. This is a scammer so don't waste your time. Here's what transpired:

So I saw this house with a great price listed FSBO on the MLS yesterday and I thought what a great deal, let's see what I can talk the owner into giving it to me for. Called the number listed (an Ohio number, red flag 1) and got a voicemail. Texted him also to say I'm a buyer and was interested and a few minutes later got a reply asking if I was an agent or a buyer. I replied buyer and he texts back saying he's out of the country (red flag 2) but he can give me a pin for the self showing. I said okay, but we'll have to meet up to talk a deal and "This smells like a nigerian scam btw. Don't even think of asking for upfront money. Lol."

. . . and the very next message I get from him is . . . drum roll please . . . "Can you pay for the upfront money so that i could send my lawyer to you..." (red flag 3)

Then of course I tell him to f--- off. Anyhow, be careful in your dealings and good luck to all. Sometimes when a deal is too good to be true it probably is.

Never tried them. I would love to hear your experience with them though. Ideally you would get a better rate, but logically, I see Costco as a middle man that gets their cut and thereby drive the rates higher. What is your current rate and terms and what are you hoping for?

You can buy a 6 unit mf property for 145k? Dang I'm living in the wrong coast of the us.

There are two meetup groups that I know of in the Las Vegas area, but only one that I know that is local. The other is online. Barri Griffiths run a meetup that is meeting on Oct. 28 with a guest speaker on getting a loan from banks to fund multi-family deals. 

https://www.meetup.com/Las-Vegas-multifamily-syndi...

I've met up with him once and also attended his last meetup which I found to be quite informative. His meetups are geared towards beginners so you might be interested.

At 10% with the same assumptions above, your PITI would be $1093. Closing costs are hard to say because it depends on many factors such as which banks you get it from (paying points, fees, etc.), but I remember buying my house for around $190k a while back and I paid around $4-5K in closing costs. Prices may have changed since then but here's a breakdown of what you might get charged. These are mostly hard costs that's hard to negotiate:

A. Bank origination charges: ~$1400 assuming no points

B. Appraisal/flood/tax service: $500-600

C. Title/settlement/your coverage/lender's coverage: $1400

D. Taxes/prepaid insurance: $500

So my estimate would be around $3500-$6000

At closing everybody's got their dirty hands in your pockets. Good luck and keep us abreast on your progress.

Let me preface this by saying that I'm not in your market and I have no idea what it's like in the midwest. With that said, let me do some number crunching for you. On a $205k conventional loan at 4% interest your principal and interest (PI) is only $979/month. Let's assume a 1% tax for your area and insurance of about $500/year. That puts your monthly payments at $1191/month. If you can get put 20% down (about 40K), then the monthly payments are $961/month. If you plan to live there under this scenario, your tenant from the other unit pays for your housing expenses and you only have to worry about vacancy, capex, repairs, and utilities. Spectacular deal but I don't know if that's the norm for these places. You mentioned the duplex is in great shape so capex and repairs will be minimal or deferred for some time. Plus another one for you.

Sounds like you have hard money lenders in hand. A reminder you can always refinance afterwards and make those numbers above a reality for you. If I were you and I don't have my own place, I would totally house hack this place. It would be a solid step forward.

If you have the W2 income for it, do a cash out refinance for an investment property. The rates are higher but you have access to your equity which IMHO is worth it. At 70% LTV you can pay off your loan and still have $345K left assuming the market price is $900K. Local banks around the area are offering 4.25% to 4.375% as recently as last week. I know because I just got rejected after going through their executive review due to no W2 income (my properties are also bay area).

The benefits are that your cash flow increases due to the 30 year term versus the 10 year term even though the interest rate is higher. You get to keep the property and bank on future Bay Area appreciation. You also bank on potential rent increases. Those things you don't give up. Plus you have $345K untaxed money to do what you please whether it be index funds or syndications. Have your cake and eat it too! For that last part, just make sure you know what kind of investments and risk you are getting yourself into.

BTW, I would not pay down the mortgage. At 2.75% it's a waste of capital. Even at 4.375% I would not pay. Oh also, the 4.375% is a 7/1 ARM 30 year amortizing, which is not as good as you got but still not bad.

1031 exchange might not be necessary in this case since you got it as an inheritance and there should be a step-up in the basis so I don't think you'll be paying much tax if any. But I'm no lawyer though.

@Jorge Jimenez In that case I would second @Craig Curelop 's suggestions. I would add though for someone relatively new, it is better to get your feet wet doing the management yourself and that would require proximity to your rental. You'll learn more and know the ins and outs better. Why did you lose your two family house (duplex?)? How much is the condo worth on the market now? Do you have any skills fixing up places? And are you willing to be a landlord in New Orleans? These answers might allow others to chime in and give you better advice.

Yeah, I went to the meetup last month. It's definitely geared towards flippers, not my cup of tea but if that's your thing, you'll fit in perfectly. There were lots of newbies as well as seasoned professionals so I'm sure it'll be a blast for ya. Good luck on getting those deals.