Real Estate Investing: Don't borrow against your primary residence to buy an income property. |
- Don't borrow against your primary residence to buy an income property.
- Looking at my stock portfolio, so happy I have real estate
- Aspiring Investor here. What services are underrated, but still valuable enough, to have me work with/under other real estate investors and developers, while still providing them some value?
- Is it a bad time to buy an invesment house?
- Any success stories investing in condos?
- Understanding refinance with interest rates going lower
- Question about a Heloc?
- [US-CA] High equity, low cashflow. Not sure what I should do next.
- Has anybody bought real estate as a tax sheltering for capital gain?
- Coronavirus's effect on the US Housing Market
- Planning on passing out flyers in a neighborhood I'm looking to invest in. What should they look like?
- Should I buy the house behind the noisy bar?
- We need to help each other. If you are in the US in an area that was first hit by coronavirus please read.
- Which applicant to pick?
- Section 8 California
- College towns
- Feedback on seller financing terms
- Rent and ride it out for several years or expedite flip process?
- Would this be mortgage fraud? Manufactured home mortgage question.
- Should I refinance now while my home value is high but lacking upgrades or wait till after renovations in summer and hope the housing market hasn’t crashed?
| Don't borrow against your primary residence to buy an income property. Posted: 13 Mar 2020 06:43 PM PDT So my wife and I just got done meeting with a financial advisor. I'm sitting there ready to talk BRRRR strategy. I'm thinking I'm going to borrow against the equity in my primary residence to purchase a property to renovate (edit: then reappraise, refi, pay off debt tied to primary residence,) and then rent. Owe about 80,000 on the house that is worth 260,000. But this guy is saying contribute as much money as you can into your TSA and your Roth IRA. And whatever you do, DON'T BORROW AGAINST YOUR HOUSE. He was very emphatic about that. his reasoning is basically, what happens if the housing market goes down or what happens if you can't find a renter. At this point my thought about that is, why the heck not? The risk of doing this kind of deal is going to be the same whether or not the money borrowed is tied to my primary residence or not. Even if I just happen to have the cash for a down payment, the risk of buying, rehabbing and renting is going to be the same. And now he has my wife scared that we could lose our house if we do this. I'm pretty upset right now. I don't really see that happening. I'd love to get some perspective on some of you that are already on me real estate investing side of things. How much validity is there to what this guy is saying? [link] [comments] |
| Looking at my stock portfolio, so happy I have real estate Posted: 13 Mar 2020 06:00 AM PDT Yup got my rents this month, all I hear are my finance friends freaking out about how their stocks are down should they sell etc. Don't hear a single one who said oh it's so much work being a landlord why would anyone want to do that? This right here no matter what people need a place to live. Hopefully tenants can keep working. Be safe out there. [link] [comments] |
| Posted: 13 Mar 2020 06:16 PM PDT I want to learn from other investors in my local area, but I don't want to blankly walk in with nothing to offer them. I just don't know how to meet other local real estate investors without having to get my real estate license. [link] [comments] |
| Is it a bad time to buy an invesment house? Posted: 14 Mar 2020 12:32 AM PDT School close, workers working from home. Im not sure if any renters will still interested to rent a house? Any opinion on this? [link] [comments] |
| Any success stories investing in condos? Posted: 13 Mar 2020 04:26 PM PDT I hear all the time a condo is not an investment. I have desirable city, solid location, 137k, could fetch 1400 rent, under 300 hoa. [link] [comments] |
| Understanding refinance with interest rates going lower Posted: 13 Mar 2020 11:33 AM PDT Hey all. I figured this is the best place to ask this question and please note, I will be following up with my mortgage guy regarding this question as well (on vacation) so I thought to ask now anyways. With interest rates lowering, I'm wondering if it's wise to refinance our primary residence. Thing is, I don't have a game plan or really understand the purpose of It. Is it to lower our mortgage payment? Take cash out and pay off higher interest bills? My wife has student loan debt, and aside from our mortgage, that's really our only debt. We were looking to move and buy a second property within 2 years, but we're currently discussing of holding off for an additional couple years beyond that. I guess my question is, what are the pros and cons to refinancing right now with interest rates going lower? I'm completely new to this so please excuse the "noob"ish type of question. Thanks [link] [comments] |
| Posted: 13 Mar 2020 09:52 PM PDT So I will keep this short and sweet. I'm 23 and I recently applied for a Heloc loan to have in my back pocket for a potential down payment on a rental. I applied with discovery and they offered me a loan on my house at a 6.99% rate. That in my opinion is extremely high and not worth taking the money out. Did I do something wrong? My credit score is 750. It makes absolutely no sense. Any advice is great. Thanks. [link] [comments] |
| [US-CA] High equity, low cashflow. Not sure what I should do next. Posted: 13 Mar 2020 12:45 PM PDT Hey Reddit, I'm looking for some help with my current real estate portfolio. I'm in California and starting in 2016, I began purchasing properties locally, 2 per year. I focused on single family homes, all 3 bed/2 bath, between approx. 1200-1500 sqft. I typically put 25% down and borrowed the rest at interest rates between 3.75%-4.5%. Did some minor repairs and put the properties up for rent. In my market, finding tenants has been very easy (way more applicants than I can even screen) and rents have risen pretty steadily year after year and tenant turnover has been very low so far. Selling some other investments (non-real estate) I was able to pay off a few of the properties and also purchased my own primary residence. I'm now in a position where due to paying down some loans aggressively combined with the wild appreciation in California over the past few years, the equity I have is pretty high whereas cashflow is really weak after factoring in all expenses. Because I only have 8 units, self-managing them has been very easy. I might spend 2-3 hours a month on managing (if that). But just to be on the safe side I am still calculating property management fees when determining cashflow. I am allotting 10% to CapEx+Repairs, 8% to vacancy, and 10% to property mgmt. Realistically vacancy has been non-existent in my 4 years of ownership but I don't expect it to stay like that forever. I'm including a screenshot of my excel spreadsheet showing my current portfolio. In my cashflow calculation I'm also having it pay my primary residence's mortgage (PITI) but after that I'm only left with about $600/month. Realistically I am not paying a PM company so I am ending up with more but its not that much more. Either way my cash-on-cash is terrible. At this point I'm just not sure what I should do. Should I start refinancing and pulling cash out to buy more? Wait until there's a drop in the market? Did I buy a bunch of bad deals? Because I have a day job which requires long hours, I have been afraid of investing in multi-family properties where the amount of hands on management required may be a lot higher due to a different tenant class. I have been spoiled by going months without speaking to the majority of my tenants and due to my W-2 job requiring so much time I would like to be able to have a portfolio that is less management intensive. Portfolio without primary residence Portfolio with primary residence Edit: Added breakdown without primary residence [link] [comments] |
| Has anybody bought real estate as a tax sheltering for capital gain? Posted: 13 Mar 2020 04:53 PM PDT I am looking for the best tax sheltering to help me offset my weekly/monthly capital gains from stocks. I am told real estate is probably one of the best tax sheltering that the government has to offer. Just wanted to know any first hand experience if anyone owns real estate and stocks to help lower their tax burden. If so, what aspects in real estate helps the most in lowering your taxes? [link] [comments] |
| Coronavirus's effect on the US Housing Market Posted: 13 Mar 2020 07:44 PM PDT Hi all, Just wondering what your best predictions on the impact of the pandemic to the US housing market and how you think things will be in the next couple of weeks. [link] [comments] |
| Posted: 13 Mar 2020 04:51 PM PDT As the title says, I'm looking to purchase a property in a specific neighborhood that has very little for sale right now. I'm planning on hitting up quite a few places and dropping of flyers on their porches (fingers crossed for no trespassing lol). What info should be on these flyers? My name, explain I'm looking to buy property in the area, ways to contact me, ect. Anything else? [link] [comments] |
| Should I buy the house behind the noisy bar? Posted: 13 Mar 2020 09:14 AM PDT I'm looking at a house I could buy for $140,000 and do cosmetic improvements, and comps in the neighborhood, updated, or selling above $200,000. But directly over The back fence is a noisy college bar that is super loud four nights of the week until 2 am. How much is that going to hurt resale value? [link] [comments] |
| Posted: 13 Mar 2020 08:36 AM PDT So far my philosophy of following world events in places where The virus has a Headstart has been very fruitful. I encourage you to seek out news sources from Italy and the places that were first hit in the US like Seattle and New York. I feel very strongly that for the for seeable future whatever you see in Italy is going to happen in the US about a week or two later. Whatever you see in Seattle and New York is probably going to happen in other cities as time passes. Hopefully the United States will utilize this delay to our advantage. (Please no politics in the comments) Those of you in the areas hit earliest - what are property managers and landlords seeing / doing? What kind of issues are you running into? How are you solving those problems? I realize that tenant law varies greatly from state to state but I would not be surprised if what the courts in the earliest hit cities do (rent forgiveness, etc) doesn't set some kind of general president for what other later hit cities do as well. I might be asking this early. I plan to ask it again in a week. For now, anything you can provide could help those of us who will be in your shoes next week. Thanks. [link] [comments] |
| Posted: 13 Mar 2020 10:42 AM PDT 1 has been easy to deal with on the phone. He is the only high income earner of his room mate (3 total) situation. Downside is they are out of state and have not seen the unit yet. They have put a holding deposit though the agreement states that if I back out which I reserve the right to, I refund their deposit in full. They do not have full funds to move in yet and will be here in 5 days to look at the unit in person. 2 has all high income earners making six figures each, ivy league educated, but one person in the group was rather picky (she even told me they left choosing a place up to her) which makes sense that they sent her, she must be the one that finds fault easiest. She also said she sometimes butts heads with the landlord over the landscaping, they want to garden, he doesn't want them to. They are ready to pay in full (first, last, and deposit). 1 is easier to deal with but higher risk due to not having seen the place. Also only one high income earner in the group. 2 is local, ready and made up of high income earners, but one of them might be annoying. SO basically what I'm balancing is easier to deal with vs ready now, higher income but maybe more pain to deal with. What to do? [link] [comments] |
| Posted: 13 Mar 2020 11:05 AM PDT Anyone here do section 8 in California? How is the process of getting the property approved and rented? [link] [comments] |
| Posted: 13 Mar 2020 04:56 AM PDT Slow right now at work so I'm going to take some inside thoughts write them down and ask a question. Wondering if folks have had luck with condos/apartments in college like towns. Using the 1% rule some of the units check out. Zillow ( I know Zillow isn't perfect) shows unite for sale 2bed one bath for roughly 50k. Rentals in same complex are listed around 900. Loan taxes. Condo fees insurance would be 500 a month. So I guess my primary question is if college towns are a bad idea. It's a town of 30k. Large regional hospital. Student body of 10k. [link] [comments] |
| Feedback on seller financing terms Posted: 13 Mar 2020 10:43 AM PDT Hey all, Relative newbie here, been doing my research for ~4 months and am looking seriously at my first property. The seller offers seller financing but will also take traditional financing. I ran the numbers with my quotes for a traditional mortgage, and I come out slightly ahead that way (+1.5% annual returns). Here's the potential catch: the seller's terms are that the property is only in escrow for 7 days, or it reverts to seller financing. Is that feasible when both buyer and seller are out-of-state? How likely am I to be able to get that done? I know 30 days is typical. Sorry if I left out info - let me know what else I should be looking at/thinking about and I'm happy to update! [link] [comments] |
| Rent and ride it out for several years or expedite flip process? Posted: 13 Mar 2020 09:48 AM PDT Hi all, We closed on a SFH in CA's central valley region ~3 weeks ago for 220k (3 bd/2ba, 1650~ish sq feet, 1200 per month mortgage w/ insurance) and have put in approximately 7k to get it ready to rent. It is aesthetically pretty good at this point (new kitchen minus countertops, paint, new landscaping, etc.) and we have gotten a ton of interested parties contacting us over the past week in renting it out at 1575 per month. Our original plan was to rent for a year and then likely flip it. The house is in good shape but doesn't have a "true" master bedroom, and (at least a few weeks ago) if we were to add a master for ~9k, comps are going for 270-290 in that area. Given the recent market changes, we are now wondering if it is just best to go ahead and put it back on the market with the recent minor improvements with the hopes of selling it for 250-260. We definitely don't want to hang on to this thing forever and would like to jump on another property in 6-8 months if there really were to be another significant real estate dip (which obviously is unknown at this point). What does everyone suggest? Rent it out with the risk of tenants being unable to pay the rent? Possibly be stuck with it for way longer than we intended because the value had decreased so much over the course of a year? Or put in a few extra thousand (countertops, more paint, fixtures) to get it ready to put it back on the market (capital gains and real estate agent fees being factored into all of this as well) and hope that we can sell it before things may turn south (even if its for a 1k profit)? Any thoughts are appreciated. [link] [comments] |
| Would this be mortgage fraud? Manufactured home mortgage question. Posted: 13 Mar 2020 08:50 AM PDT I'm currently in escrow on a manufactured home that's on land. It is pretty under valued and will have an ARV of 50-75k of purchase price with 10-15k fix up costs. I'm purchasing this property as a second home as it's up close to my family and I'll be making frequent trips over the next couple of years. I'm purchasing this property with a second home mortgage. Here's the thing.... since I've been in escrow, my old manager has reached out and there is a slight possibility that I may switch companies in the next couple of months. This would result in me moving and not using the property much, if at all. If that happens I could rent the property or sell it although, I would like to hold onto it for at least a couple of years. Here's my question: would it be mortgage fraud if I end up renting the property out in 6 months - 1 year if I end up switching companies? The mortgage company company I am using does not offer mortgages on investment manufactured homes. I did find a company that would mortgage a rental manufactured home but the rate is more than double and the term is 10 years, which would not be ideal if I did end up keeping it as my second home. My thought is to continue with the second home mortgage and IF I do end up renting it out, switch my insurance policy over to landlord. I'm just so unsure what the mortgage company will do once they get the landlord policy. Any advice or suggestions would be awesome! (Please no advice on whether or not a manufactured home is a good investment😁 ) Thanks and Happy Friday!! [link] [comments] |
| Posted: 13 Mar 2020 05:55 AM PDT I currently own a quad plex that was valued at 118k when I bought it 2 years ago. Since then the market value has raised to $140-155k. It's a very hot market and I could probably sell at max value without putting in any more money. However my goal is to own long term and create cash flow so selling doesn't sound very appealing to me. 2 of the units need to be updated which I was planning on doing this summer. I suspect that the value would raise to max 160-170k ARV. I was planning on doing Reno's and then cash out refi but now I'm wondering the current hysteria is going to annihilate my equity and prevent me from capitalizing on the renovations. What do you guys think? Refinance now and secure SOME cash for the renovation or wait and see how the housing market affects value? Or is there another vantage point that I'm missing due to inexperience? Thank you for your time [link] [comments] |
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