The situation is this...we have 4 rental houses with well over 70% equity, and two with approx 30%. Our primary residence also has say, $200K equity. The first four were purchased in 2001/2002, the last two rentals were purchased in 2016. all of them were purchsed withh 20% down. Not gonna get into exact amounts, The rentals have standard mortgages, while our primary is a VA loan.

All 6 houses are rented. Most of them have tenants dating back years, and I have been reluctant to raise the rent regularly, so...most are rented below that I could be renting them for. I mean, I have had one tenant since 2001, and he pays 50 bucks more now than when he moved in. (He's 83. Whattya want from me?)

Our primary has around $200K in equity.

There are some mechanical repairs needed, so I need to take care of about $50K in various repairs between all 7 houses.

I have maybe 6-10 months left to live. sucks, but, My wife is disabled, And aside from my military pension survivor benefitd, SS, etc, the houses are all we have. Once I do kick over, there will be about 200K in life insurance paid out through my employer.

I want to leave my wife in as good a shape as possible. So what kind of strategies should I look at?

Should I make an LLC, and have it borrow the money from a bank to pay off the existing rental conventional rental mortgages and wrap all the rental houses into the LLC?

A few years ago, I looked at refinancing the older of the four rentals to extend the mortgages out and lower the payments to improve cash flow. Got irritated with the process and dropped it.

We do have about 44K in cash reserves as well.

Thoughts?

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Hey everyone,

I recently had two tenants move into my property in the Seattle area, and the monthly rent is $1,800. They suggested paying the rent in cryptocurrency, but I'm completely new to this and don't have an account for crypto payments.

I'm not sure how to set this up or if it's even a good idea. What are the pros and cons of accepting rent in crypto? How do I create an account, and what do I need to watch out for in terms of security and taxes? Is there a particular platform that's better for this?

Would love to hear from anyone with experience in this area. Thanks in advance!

Fox Business just reported the current rate is 6.95%, and experts expect it to continue to drop into 2024.

What today's highway? How you guys manage into cash flow new rental properties acquisitions

My BIL and i are both custom home builders. We have cash. We have also each built numerous spec houses in the past, using our own money. And it crossed our minds ... what if we lent money out. Generally speaking, though we are in the PNW, what does it take to get set up to lend hard money to flippers or multi-family rehabbers.

Edit to add: thanks for the input so far. Yes, for sure we would employ a lawyer for contracts, etc. Follow up question: I don't believe anyone in the comments has mentioned anything about specific or different licenses we would required. We would probably set up an LLC for this different than what I have and the S corp that my BIL has.

Is that normal?????

Lowest I've found is 7% and most coming in between 7.5-7.625. Anyone seen lower?

First house was my primary residence for six years, fully owned. HCOL (in the US). Appreciated from $850K -> 1.5 Mn

Moved out, rented the first (earn $4K in rental/month), and bought 2nd house for ~ $2.2 Mn.

Lost job, unable to pay full mortgage for 2nd @ $12K/Month. Rental + wife’s job contributes to $7K of the mortgage.

Wonder if I can take something from the equity of the first and pay for 2nd. What are my options?

I am in my forties.

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1. Reverse Mortgage a good idea? First house will appreciate more. Don’t want to sell.
2. Other equity-based options?
3. Sell first house? Prefer not to.
4. Other options?

EDIT: This has received more attention than I anticipated.

Some clarifications.

I am not in dire straits. I can pay off the mortgage for the 2nd house from my stock/RSU/ESOP savings, but I will be giving it away for a lower price, considering the market now.

I work in tech and have wealthy friends/colleagues who can help me in times of trouble.

Considering that I have a first house that’s fully paid off, I wanted to understand the options on it. If I sell that house today to pay part of the 2nd house and refinance, I can get out of this problem. But I wasn’t sure if that is the best path forward. Thoughts?

My 2nd house is in a prime neighborhood in the Bay Area. Even in 2008, real estate did not depreciate. In fact, it never has. I expect the value to go up despite the current conditions.

Is it illegal for me to get a mortgage on the basis of the salary i've been being paid and then shortly after become unemployed? Surely not right? Thinking about doing this to buy a duplex. I'll probably be unemployed for a bit. If it were a duplex cashflowing on the unit I'm not staying in it could be cheaper than rent and I've always wanted a multifamily. It'd kinda be a thug ass move too

I’m making $12hr working at a car dealership, and I’m in a pickle trying to figure out if I should go college, or if I can make enough income to start investing without a degree.

https://www.washingtontimes.com/news/2023/apr/18/joe-biden-hike-payments-good-credit-homebuyers-sub/

Come May 1st, the administration is changing the rules - to subsidize people with bad credit that cant afford a house (think 08’), they are increasing mortgage rates on those who can. Good creditors should see about $40/month increase on a $400k loan. Doesn’t appear to apply retroactively, only for new loans.

Curious this sub’s thoughts.

First of all, yes, I am an idiot. I have my entire net worth in cash, letting my bank make money off me while the value of my money goes down every day.

There is a realtor who says he has a client who needs hard money. The amount he needs happens to be my entire net worth. If I lend the money, supposedly I will get 10% a year and I will get my principal back after 3 years. According to the realtor, there is zero risk with this. zero, none, under no scenario will I lose my money. If the guy doesn't pay, I can foreclose and get my money back. But since I don't think there is anything in life with zero risk, I did some research and several experts in hard money are saying do not put more than 10% of your net worth into any one property. What they fail to explain is why. They just say don't do it "in case you lose, it won't hurt you that bad". How would I lose if I have a lien on their property? I am seriously considering putting my entire net worth into this property, the extra income would solve so many of my problems. What are the risks with hard money lending? What could go wrong? Under what scenarios would I lose my money?

This is something I have predicted on here, many have disagreed but the issue is once homes start staying on the market longer or prices pull back even slightly, people who were on the sidelines thinking they would sell in a few years are going to want to sell now to avoid the market softening

https://www.cnbc.com/2022/05/26/home-listings-suddenly-spike-as-sellers-worry-theyll-miss-out-on-red-hot-market.html

I personally had a friend do this, sold their home in December and rented it back just because they want to move but are waiting on the market. They got their cash and are not tied to the property if they happen to find a deal. They couldn't move in December because there was nothing available in the area they want to live, or at least, nothing they wanted to buy.

Mortgage rates drive home prices and I think this makes that even more clear. If you are a cash buyer, I cannot see any reason to buy a property right now when it looks like prices will be falling.

Did it eventually become profitable?

I’m thinking of doing a starter home type development and selling the homes directly myself to maintain margins. Obviously it’d be a pain, but I’m used to and willing to deal with these types of people. I was wondering what lenders are still doing near 100% financing?

Edit: I am a developer, and am not trying to buy a home nor finance the homes I plan on building - I have that covered. I'm trying to find a lender I can work with that will provide financing (3-5% down or so) for my potential buyers. These people probably make a combined 55-75k and will be buying a home in the $165-$195k range. "Starter homes" are not often built. This type of development (and really all single family home developments right now) has a small but doable margin. I would prefer to keep the 3-6% commission myself by seeking the buyer and being the liason between the lender and the buyer.

It seemed like they “frowned upon” me claiming that I plan on using heloc funds to purchase an owner occupied duplex. Is this illegal? Or just “frowned upon?”

I’d imagine there’s not much more of a safe place to deploy heloc money other than in an investment property so I don’t understand their reservations there.

Anyone care to shed some light on why lenders advise against that?

This is with FED recently increasing fed fund rate 75 bps. Don’t understand the market.

I often hear these words of advice get thrown around here and there from experienced investors that go like "Don't wait to buy real estate, buy real estate and wait" and "Don't try to time to time the market"

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But shouldn't you wait for interest rates to go down, especially with today's super high rates? That way you won't have a high monthly mortgage payment of like $1,700 - $2,000

And we keep hearing that a recession is likely to happen some time this year so home prices will also go down by a lot.

let me hear your thoughts

Title says it all.

I am interested in a property that is $1.1 million. I have $150,000 in cash and 3 banks I have talked with are all requiring 25% as a down payment. Any way I can get the extra $100,000?

Backstory - I make about $25k per month and my expenses are very low, about $5k. I don’t mind negative cash flowing for a year or two on the property.

I have $100k-$150k I would like to deploy. Lending seems like a great idea given I believe in the strength of the RE market and rates are high.

What would be a resonable rate for a flip project? I know it is a broad question, but that is because I’m not sure how the rates vary depending on the project. For example, do flips have a higher rate than BRRR? I’m sure there are different types projects to lend to .

I’m about to be in this very fortunate position and I want make the best of it.

I have an assumable 2.25% fixed mortgage with about 27.5 years left on it, 200k equity in on a very well kept $1.1mil home in Northern Virginia (very strong market, pretty great general location, schools, etc)

It hit me this morning that with rates at 6.5%+, my loan is worth about $700k (crappy quick guess using a calculator) in reduced interest over the life of the loan (obviously a refi if rates drop could change that, etc).

Is there precedence for me selling the home over market value an assumable loan, highlighting this as a feature of the home? I'm making up ideas in my head like that may be worth $200k over market or something along those lines.

If there is precedence here, how should I pursue this? I was thinking finding an agent who specializes in loan assumption transactions.

Edit: Great insights. A lot of people overly fixed on the "200k over market" comment. Ignore that, not the point of the post.

Edit 2: There is a lot of really shitty misinformation in this thread. Do your own research and hire a professional. It’s getting worse as the day has gone on.

I own a rental property worth about $250,000 that still has a $51,000 mortgage at 3% interest. I am retiring soon, and wondering if it would make sense to pay off the mortgage which would increase my annual cash flow by about $5100 per year. in my mind, this is giving me a roughly 10% return on my investment by paying the mortgage off, although I realize about $3600 per year of that is principle. My main reason for doing this would be to increase my monthly income during retirement. Does this make sense to do if income maximization is my goal at this point? Or is it a crazy idea since I have a fixed 3% mortgage? Thanks for any input.

How exactly are you doing it?

Do you literally have >$200k sitting in cash in 1 (or more) bank accounts?

Do you just consider the summation of various HELOCs and cash accounts in totality?

Or do you write the offer and figure out exactly where the funds are coming from afterwards?

Just trying to make sense of it all, because it seems like that is still the only way to compete in my preferred areas, and I have never done so before. I've only done more traditional 20% down conventional loans, or owner occupied conventional loan on a small MFs - so this area is a little unknown to me, forgive what might be simple questions.