I’m just looking for info regarding getting the loan or mortgage for the multiple family home.
I feel as if for the price of the property the rental income it currently has tenants, I imagine it would pay for itself. The problem is it has other areas of the home that needs restoration.
What can I do to get approved for the loan, I already have a house/mortgage on our regular house (me and my girlfriend). I don’t have a lot of money saved for a down payment.
Is it easier to get approved if I lived there, would I actually need to live there everyday?
How long have you been in your current home? If over a year, you could still do an FHA loan and keep your down payment at 3.5%. If not, you will have to go conventional which requires a 20% down payment.
Technically, for an FHA loan you are required to live in the house for a year after buying it but no one really checks that.
If this is an investment property you don’t want to throw too much money out of your pocket at it. Do you already have a house in mind? Or are you just getting onto the idea?
Are you buying it from someone you know? Is it listed on the MLS? I only ask because doubles are crazy competitive right now. If it’s not listed and you can snag it without it hitting the market you’ll have a better chance of recuperating your costs. If you can secure private financing to buy the house you can make it a much more lucrative scenario.
It’s the BRRR method.
Buy with private financing
Renovate/Refurbish
Rent (which is already covered)
Re-finance to cover the private financing plus your refurbishment costs
As long as the rent you’re bringing in surpasses the mortgage after refinancing with a good margin, you’re doing alright.
Holy shit man! I’m in the same boat right now. Looking to buy the house next to me. No MLS yet and lived in my current for 3 years. Do have a home equity loan so I’m sure that’s not helping.
I hear ya. The one I have in mind needs a lot, a real lot, major restoration. But I love the old architecture, and is love to own it and slowly do things to it. Most likely it’s not possible for me.
Not this one. Already has a tennant in the garage apartment. Rest of the house is 3 bedrooms, 1 1/2 baths, kitchen, liv rm. and just needs a vaccuuming. Already has split utilities. New roof, windows, and siding. Wait a minute…do you know where I live?! Disregard this post!!
I would say that’s what it needs in one part of the house, the rental areas are occupied but I don’t see it possible for me to get a loan on it since I already have an FHA loan on my current house. Apparently you can only have 1 at a time.
My wife and I contemplated using some of her 401K money recently. From what I recall, should could borrow the money, then would have to pay it back on a monthly basis, with interest, but the interest would be money being fed into the account above and beyond the principle originally borrowed (so basically you are paying yourself interest). It seemed like a good deal as long as you had the means to repay it. I don’t recall what the terms of repayment were. One of the reasons we didn’t do that was because the 401K was from her “previous” job. She still had emplyoment status there, but was idle, and if she had been terminated she’d have to pay it back in its entirety immediately. Instead, I believe it’s getting rolled into the 403 she has at her current place of employment.
So if I borrowed it from my 401k not only would I continue to put 5% of my income I to it, but then whatever my terms of the loan would be? Or could the 5% I’m currently putting in just go to paying it back ?
No better money to borrow than your own to pay back with interest…I have done it several times…
Talk to your 401K provider, they can explain it all, but it is a pretty easy process…most loans cap out around 5 years on term, and the interest is usually in the 2-3% range…
I’m sure Joe knows. I was just always told you’re shorting yourself on earning potential of your investment, however, paying yourself interest doesn’t happen too often either.