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Until they get bought up and merged with some faceless conglomerate bank. We were so happy with the local branch of our regional bank. We knew the manager (our neighbor), the loan lady, and most of the tellers. Recently they were bought up, and now it's like a whole new place where we are anonymous.
That's why it's more important today than ever for a person who is interested in investing in real estate to accumulate a sizeable sum of money to use for their purchases, and refinance as needed to keep a sizeable sum of money available to them. That way, they don't have to jump through all the hoops and do all the crap that many of the banks require today for a loan. You can essentially tell the banks to "stick it" and deal with sellers on YOUR terms, not the bank's terms.
That's why it's more important today than ever for a person who is interested in investing in real estate to accumulate a sizeable sum of money to use for their purchases, and refinance as needed to keep a sizeable sum of money available to them. That way, they don't have to jump through all the hoops and do all the crap that many of the banks require today for a loan. You can essentially tell the banks to "stick it" and deal with sellers on YOUR terms, not the bank's terms.
I think this is the way. Kicking myself a bit for not re-leveraging my paid off rentals earlier.
Back in 16 or 17 I realized my sister was living in an overpriced dump in Chicago. So we found a home to buy with a perfect spot for decent art studio in the front if she wanted. Originally the goal was to get a loan with both of us on. She'd pay it as her own and I'd be there as insurance. To my surprise, the bank wanted me on the loan, but I became the problem. They didn't like my rental (loss) even after pointing out it was all depreciation. They didn't like my capital gains. They didn't like my consulting income (switching jobs in a nonrepeating fashion). They basically haircut 100% of my income and then said I was too short.
Too their credit, they eventually would have done the deal, but we would have missed closing and my flight out. I had 2 business days to pull the money together....and at that point it took 3 days for a stock sales to clear. So I did it on 0% cash advances (you pay a fee of 3-4%) on credit cards and we wired over our emergency funds. Once i knew we'd have enough I told the bank they were out and we were going to proceed. This shocked the bank as they'd called the local agent first who had actually worked it out....but I wasn't booking a separate trip.
The close was so much cheaper with it drafted for an all cash buy.
The home was literally single digits % of net worth, and less than one year of income if they hadn't haircut it all.
So we set it up with the minimum Federal Tax income and she paid me until she got it low enough where she could refinance on her own and then paid me off. She did it right.
Yep, dealing with banks can be a real PITA. For many years I jumped through their hoops because it was necessary to obtain the funds to do my deals. I had no other choice. Today, if I want to buy another property, I do a few clicks of the mouse and pay cash for it.
Location: Formerly Pleasanton Ca, now in Marietta Ga
10,353 posts, read 8,581,497 times
Reputation: 16698
Quote:
Originally Posted by fluffythewondercat
The secret to getting a mortgage once retired is to not volunteer the information that you're retired.
You do have income from rentals, I think you said. I wouldn't want to sell SV rentals, either.
Unless you can prove income from working that won’t work.
I’m retired and live off rental income. They will count it, but only a percentage, sometimes like 70% or so.
When you report your rental income they will look at tax returns, ask for a spreadsheet of properties with numbers.
Location: We_tside PNW (Columbia Gorge) / CO / SA TX / Thailand
34,751 posts, read 58,116,312 times
Reputation: 46242
Quote:
Originally Posted by Charlie&Rose
If you do handy work in your rentals.....then you are not retired. You do recieve income.
Wrong....
Many of use do "something" of monetary or physical value every day of retirement. Whether it be portfolio management, fund raising for charities, help relatives or friends complete tasks which result in their financial livelihood, consulting gigs, (for fun, learning's, staying current with technology), mentoring youth, teaching as community service..AND...RE ownership rentals, partnerships, speculation ... .).
Many of my rentals are 2500 miles away. They don't bother me or occupy my choice of free time. I did just spend 30 seconds texting a tenant, because the neighbor's cows were out on the road. It did not ruin my day, or my retirement. I probably won't hear from the tenants again this year.
All of this stuff and more is an obligation, but it is not required for our daily sustenance. We don't HAVE to do any of this for financial necessity, we don't report to duty as a wage slave, we're retired, by choice, (Often for decades before age 65).
Retire early, retire often!. Daily if you want!
Do something for others or your community each day. (If you so desire).
You're free, enjoy each day, and bring enjoyment, peace, comfort, and success to others. Tomorrow you may not be free, nor retired, nor alive.
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