What Are My Options In The NYC Area??
I really want to get into REI either to buy a condo or a multi family property. I am looking in Queens & in the Jersey City NJ area.
Here is my financial info:
My gross yearly income is $58,000
I have $70,000 in stock brokerage accounts & another $20,000 in cash savings available.
I can't tie up all of it because I want to pay off about $15,000 of remaining credit card debt.
My FICO score is around 640.
It seems that in the NYC area (Queens), everything is out of reach for me even with 20% down and even foreclosures go for market value. The S****tiest multi family property is over $500K.
What can I do. What are my options.
You may want to look for better deals, but you can get the properties you mentioned with Hard money, as they only want 10% down. The cheaper option would be to team up with someone and get the 20% you need for a cheaper loan.
As far as properties, you may also want to look into estate sales, tax sales, expired MLS listings, etc etc as they are usually better deals in an understocked market area such as NY. You may also want to work on your credit as 10 more points, and then 30 more after that, can save you a bundle of money and require less of a down payment.
Good Luck,
Kyle
There are always options.
You have to start off with a clear idea of what you want and why. A "condo or a multi family property" is an interesting choice. Why? It sounds like from the rest of your post that you are looking for a primary residence. Tell us more about your lifestyle. What kind of place do you want to live in? A person who has managed to save almost $100K on a $60K a year salary while paying rent in NYC is well on his/her way.
Work on paying off those cards quickly. Especially if they are at high interest rates.
As important as figuring out how much you have available for a downstroke is figuring out how much you want to pay for monthly "housing". The truly creative solution will reduce your house payment and improve your standard of living. Where do you work? How can you reduce commute time? Commuting and TV are the biggest wastes of time in our society. Blow up your TV and buy a stack of creative real estate books. Spend the time you gained looking for bargains. The answer will present itself.
Are you looking for investment properties or primary residence? If you have read Rich Dad Poor Dad you know one of them puts money in your pocket the other takes money out of your pocket.
If you are looking to partner on investment deals in NJ then there might be some opportunites here.
I'm a native NYer & my deals come by word of mouth because I tell everybody what I do...."I'm a personal finance coach helping people prevent 4closure and BK." When necessary I provide work experience & credentials. Develop your MO.
Here are my suggestions:
Get your financial house in order 1st b/c you want to be able to close a deal when you get it. WAIT before you pay off any bills. Continue to make min pmts until you know where you stand. Don't use capital to pay down debt if it won't make a big difference to the lender (ratios).
Go online to http://www.equifax.com & get your updated credit score & report yourself . DO NOT let anyone check your credit before it's time. Know your score, min monthly payment on all debts and figure out your debt to income ratio yourself.
Monthly min pmts (all) divided by gross montly income = Debt-to-Income ratio
If you need some spreadsheets or formulas let me know. I do this all day long.
Next, decide what you're buying 1st (investment or primary). Then shop for loans WITHOUT giving your soc sec #.
Once you know your #'s, you can shop w/confidence as follows:
"Hi Mr. Loan officer, I'm looking for a streamlined loan program for an investment (or 100% financing on primary). My mid score is X, my debt to income ratio is "in line" (should be less than 40%, but ask them what ratios they look @ before telling them what yours is) and I have assets (cash & securities). What programs do you have and what are the loan requirements (max LTV, score, ratios, docs, pre-pay penalty, escrow waiver, insurance requirements, adjustables & fixed rates, etc.)? Do this a few times & you will get a good feel for what's out there for you. Stand firm on giving your social. The PC answer is "I do not wish to give my ss # until I am ready to apply for a loan that meets my needs." This holds true for brokers too. Give them a copy of credit score/report (delete social), if pressed for the info. Lenders/brokers don't want to waste their time.
While you're getting finances in order & shopping for loans, check the upcoming tax sale list & contact owners that are on the confirmed & upcoming auction list. You may find props that have little or no debt on them.
Let us know what you decide/find.
Just one more thought. If you find another peson in a similar circumstance you might go partnerson on a less-than 4 unit Multifamily and use your combined credit and cash to get a mortgage. You still qualify as owner-occupied under the Hud/fha rules and you each occupy one unit of the building.
Assuming you are looking for an investment...
If you do not want to go the partner route, then consider investing at distance. There are other parts of NY State where the numbers would work just fine with the money you have.
You can also consider notes or tax liens. If you want to read up on them go to the forums where they are discussed. If I was you I would stick to property to start but look a little further away from NYC.
John
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