“My First Deal Changed My Life!” A Newbie Show with Sunny, SunMarie, and Sam | BP Podcast 210

[@BigRayH]

Sam was very Inspirational!! I just finished reading the millionaire real estate investor a few days ago and started reading E-Myth today. Plan on buying my first multi family this year, so inspired!!!

[@ToddCapitalMedia]

One of the best interviews I have heard in a long time

[@investmentpropertybar]

Me too. My first deal changed my entire perspective. It was on after I held that first check for $13,750 in my hand. I have pics and anything. Now I just get wires but I tell everyone get your first real check in hand just for the experience.

[@posesansan]

Neva Williamson my gf and I next keep up the good job

[@jmfs3497]

wow! Being able to see his Dad's mortgage was a huge gift of knowledge. Whenever I asked my Dad about bills/budgeting, he would say, "Not now. Maybe later." Later never came.

[@fatimahwilson3380]

I love the newbie shows, great stories! Keep them coming!

[@Rotchil305]

I just have recently started binge watching these podcasts and this one had a great impact. All my fears are gone. I am anxious to purchase my first property by the end of this year.

[@akuhansen11]

Great Sam. Was good show. I️ am working on my newbie investment.

[@yowdeli]

great episode, great interviews! certainly inspirational for a newbie like myself.

[@deepatterson1835]

definitely one of the top 10 podcast

[@thecleaner23]

Imagine your perfect day and work backwards. wow. Love it. Thanks for the great interview.

[@stevend481]

very inspiring, coming from new jersey as well, everyone says you can't do it due to high prices and high taxes

[@dreamingcode]

Great interviews. Got a lot from this one.

[@touriewright5428]

This for Sam: great just great advice about just trying it/do it if you have no idea "what" you want. Great man thanks

[@superskbman]

Good stuff!

[@jackiemesa5574]

Where did they get the down payment from? Private lender or savings?

[@Famvestor]

Down payment came from savings. We live very frugally, and were able to save ~60% of our income by living wiht my parents for a couple years. Making pretty decent salaries too, me as an engineer and my Wife as a public school teacher.

[@dawidsurowiec7579]

@Famvestor what small bank did you get your loan from with no pmi? my brother lives in garfield. I live in linden... your first house is my dream, i've been looking for a 4plex for over a year now and if i can rehab and cash out refinance, that would be great!! good luck!!

[@Famvestor]

Dawid Surowiec the bank is called Trustco Bank in New Jersey they have a branch in Ramsey and Northvale. Unfortunately they will only give loans to Bergen County in NJ. If you want to learn more about them, I wrote a review about them on BiggerPockets www.biggerpockets.com/forums/311/topics/390706-trustco-bank-a-review-and-recommendation-for-fellow-investors . Good luck finding that Quad, Godspeed!

[@dawidsurowiec7579]

@famvestor Great write up on the trustco bank! they have joint ventures in new Brunswick called New Brunswick and Trustco bank. Ill contact them for more information. im looking to invest in the middlesex county area.

[@jackiemesa5574]

Thank you! Trying to get started but down payment is also hard to come by. Not a lot of small banks down in Miami, FL to give loans like you guys got. But im still optimistic

[@ErickaWilliamsCC]

great interviews.. 25!! nice.. northern Virginia.. is getting interesting.

[@biggerpockets]

Thanks for watching, Ericka!

[@rpoole4241]

Question: They said they got a REO with waiting time to get occupied. Does that mean they covered the mortgage for months or you get grace period?

[@Famvestor]

Yes we did get an REO; closed in October, and spent a couple months repairing the property - all the while paying the mortgage, taxes, insurance, repair bills. Our savings was depleting fast! If I were to do it again, I would've hired a contractor to at least help me out, since I had to do these repairs at night after work. Took us three months to get it ready, and another month before we finally had tenants move in.

[@Bigbertha729]

Sam, great story.. I live in NYS as well and have a mortgage with Truscto with the 10% conventional deal as well... Just was wondering when you refinanced who you ended up choosing to do the refi with? Thanks

[@Bigbertha729]

Sunny* Not Sam my apologies

[@Famvestor]

Ah.. I was confused as I still haven't been able to hear all of Sam's story - and I thought it would be quite the coincidence if he too talked of Trustco. We actually did the refinance with Trustco as well. They just had really low closing costs($1,646), low interest rate (3.99% to 3.49%) so it just made sense. I want to make a good connection with Trustco as a portfolio lender, since I hope to use them again for the next property. Another great thing about Trustco is they will count 75% of your rental income towards your income as long as you have signed leases. This is a big deal since most banks won't count rental income unless it is seen in the last two years of tax returns. Good luck and Godspeed!

[@laughandluxe]

Great Video. Enjoyed the stories. I agree, with the air bnb guy, we all need to know our 'why' for doing this anyway.

[@biblecharlie]

Is there a place that you can go read the transcript?

[@coreymason3566]

How did you analyze this property?

[@Famvestor]

I use this analysis spreadsheet. docs.google.com/spreadsheets/d/1CQWiKpWq_9BQjPklJcun3lPi5c3h3InMCv6DrLH_r6c/edit?usp=sharing It looks intimidating, but just fill in the numbers in red. A lot of other great resources on the spreadsheet as well.

[@billy-dt5mk]

Awesome interviews!

[@brandonpelfrey4173]

this was awesome! I really liked both interviews, I loved Sam's story and advice, and sunny and sunmarie's as well. I had a question about how sunny and sunmarie's refinanced their quad (sorry, I'm a noob that is just learning), could someone explain to me what exactly they did, how they were able to do it, and how it benefited them? Thanks!

[@Famvestor]

Brandon Pelfrey So basically we bought the property for $430k. We fixed it up made it look nicer, and applied for a cash out refinance. During the refinance process, an appraisal is done and the same property just 10 months later after repairs was now considered to be worth $550k. $550k-$430k=$120k That $120,000 increase in equity is essentially now yours for the taking. We decided just to pull out what we put in $67,000. Keep in mind though, that because we pulled out that money our mortgage increased from $387,000 to $483,000. We went from paying $1845/month to $2000/month for the mortgage. The benefit though is that now almost none of our originally invest cash is trapped in the house. And we can use what we pulled out to buy the next property.

[@brandonpelfrey4173]

FamVestor wow, thanks guys! So basically you did it to cash out on the improvements you made, smart move! Also, you guys mentioned that you looked at deals for a year and a half before actually selling on one, where were your favorite places to look for deals?

[@Famvestor]

There was a recent blogpost on the forums about this. So as a buy and hold investor - I'm trying to maximize my cashflow. So I was looking at places with lower taxes, but also commutable to the city so I could cash in on the higher rents. Anyway we were looking at only the towns near us in Northern NJ: Garfield, East Rutherford, Kearny, Dover. Anyway check out the post and you'll see a list of all the town with state aid subsidized taxes. www.biggerpockets.com/forums/572/topics/395430-cashflow-in-new-jersey

[@TheOneluvlieladie]

One word: AH - Mazing!!

[@StraddleyourSuccess]

How on earth do they get that kind of cashflow from a fourplex? I know they were looking for a year and a half, but still. . .

[@touriewright5428]

Yes someine mentions "Outwitting the Devil" by Napolian Hill these guys rock!!!!

[@Famvestor]

Such an amazing book!

[@nickslayter5835]

I know y'all will not see this, but really short term real estate rentals is obsurdly amazing for building high cashflow from a few properties. Buying during a dip in a market in hawaii made me go from just 60k a year to over 500k a year before taxes. That was with just 4 properties. The key is to buy during a dip in the market and fixing up the place. Like an advanced BRRRR strategy. If people want to learn more I wouldn't mind writing a a biggerpockets blog post.

[@icawn]

nick slayter what years and how often would you say it dipped there? Not just 2008, but maybe hurricane aftermath timeframes? hawaii is very global, so very resilient to one countries turmoil, i thought. I would like to own a place either on the big island or relatively close to the north shore.

[@alwaystamcam8849]

Great interview!!! #GoSam

[@IvanTerreroDDS]

Garfield, NJ!! Old stomping grounds!

[@EeeDeeCee]

Look at your beard now, Brandon!! Good on ya!

[@sam5miy]

What is "gifted equity"

[@edgarfig369]

Do you guys have a book that you would recommend on House hacking?

[@edgarfig369]

Jarrett C. thanks will do.

[@a-ian-lim]

Anyone know any insurance companies that insure a 3-4 plex as a residential property? I'm having problems in Virginia... so far only Erie and Alfa insurance will write me a policy for a 3 unit residential house.

[@superskbman]

We ended up using liberty mutual.

[@mytuber81]

When people say "analyze the deal" or "look at the numbers" what exactly are the "numbers" we have to looks at? Should I go after and look at the "deal" as Grant Cardone likes to say? He insists that the price is less important that the ROI/how much the property pays you.

[@juniorlene839]

mytuber81 use a rental analyzer

[@touriewright5428]

very inspirational

[@alexandrialupo3166]

my question though is if their house went up in value by 120k, how did they pull out 67k in cash? what is this process called?

[@Famvestor]

Cashout Refinance. It's essentially getting another mortgage. So originally we put 10% down or $43,000. That left us with a $387,000 mortgage. When we re-financed the housed appraised for $550,000, but we still only owed $387,000, so that meant we now had $163,000 equity in the deal. So we pulled out $67,000 cash, leaving $96,000 of equity in the property. So our new mortgage after refinancing went up to $454,000, but now we had essentially put 17% ($96k/$550k) down... hope that made sense.

[@ianthompson5678]

@@Famvestor is the cash that one pulls out of their cash out refi taxed?

[@Famvestor]

@@ianthompson5678 no that’s part of the beauty of it. It doesn’t count as income, so it is not taxed.

[@ianthompson5678]

@@Famvestor beautiful indeed. Tnx

[@joelscb]

Damn. 430k for a 12 bedroom. Here in honolulu 430k will only get you a 2 br condo

[@pokeypauley844]

20:45 The average newbie doesn't have the funds to start or for down payment....

[@enigma6451]

Pokey Pauley not true. I work $13 per hour and I save $1000 weekly comfortably. work some overtime dude. You got this. We got this. last year I saved 53k

[@superskbman]

Start bringing your own lunch to work, enjoy simpler free activities(hiking, camping), live at home if you can. My Wife and I did all these things, albeit pretty decent jobs her as a teacher and me as and engineer, but we were saving about $50k a year by doing these things.

[@stevend481]

@SharnakayGreen bro just shut up, you saved 53,000 from 13 an hour? lol. You barely make 30k a year on that salary. literally impossible. how can you make 1000 a week from 13 an hour. did you work 80 hours?

[@enigma6451]

Steven Diahy 92 hours weekly to be exact and it's not that hard.

[@catladytrucker7608]

Get a different job that allows you to work overtime. Sell your car and drive an old one. Move in with your parents or with roommates so your rent is cheaper. Flip stuff you find at yard sales on eBay. Start a KZbin channel documenting this journey and get it monetized ASAP. How badly do you want this? Your first deal will change your entire life. Make it happen.

[@theblessed1848]

Dope

[@ericsimon7284]

You should have the broke agent on

[@MattBuysHouse]

Jeerzzy !

[@sigicoria7699]

is that Connor mc

[@Mbenham04]

Sam, I want you to be my mentor. :)