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- Craig Curelop turned an extremely precarious financial situation into a thriving business through a real-estate investing strategy called "house hacking."
- By purchasing a home with a small down payment, living in the dwelling, and renting out the other rooms, he was able to generate cash and live for free.
- Curelop says "there's a form of this strategy that works for everybody."
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In 2017, Craig Curelop had $90,000 worth of student loan debt and a negative $30,000 net worth.
"I realized I was just working my butt off, week after week - 60, 70, 80 hour weeks," he said on the "Real Estate Investing" podcast. "And then I said: 'Why reinvent the wheel? Real-estate has worked for millions of people over the years. Why not just invest in real-estate?'"
Curelop started consuming all the real-estate information he could handle - and after he read Brandon Turner's "The Book on Rental Property Investing," he was hooked.
"That kind of opened my world," he said. "Anyone can do this, you just need like $10,000, $15,000 and you got it."
By 2019, a frugal lifestyle coupled with a real-estate investment strategy called "house hacking" led Curelop to financial independence.
"House hacking is the idea that you buy a one- to four-unit property, with typically a 3% to 5% down loan. Because you're putting such a low amount down, you're required to live there for one year," he said. "And then while you're living there, you rent out the other rooms or the other units - and rent from those other rooms and units covers your mortgage."
Curelop says that the benefits from this strategy are widespread. A house-hacker gets to live for free, build equity in a house, and acquire "tons of wealth" over time due to increased savings and decreased living expenses. He says "it's hard not to get rich" by employing this strategy - and is currently on his third house-hack.
In a recent blog post, Curelop shared the figures surrounding his latest hack, a single-family house with six bedrooms and three bathrooms.
- Purchase Price: $380,000
- Down Payment: $25,000
- Rehab: $30,000
- Total Initial Expenses: $55,000
Currently, he rents out the master bedroom for $900 and another bedroom for $650 a month. He plans on making $2,000 a month by renting the bottom floor on Airbnb.
With a $2,100 mortgage, Curelop expects to net over $1,000 a month - all while living for free.
What's more, Curelop says that house hacking primes an individual for other real-estate investing strategies, including: flipping, buy and hold, and the "BRRRR" - buy, rehab, rent, refinance, repeat - method. The savings from house-hacking can be parlayed into these strategies. Remember, the owner of the property has to occupy the house for one year before they can move on and employ the approach again.
Although Curelop says that house-hacking is ideal for someone that's in their mid-to-late 20s, he's quick to note that families of all sizes can utilize this type of methodology as well.
"Maybe you by a duplex, triplex, or quad. You and your family have their own unit, and you share the overall building with other tenants," he said. "I think there's a form of this strategy that works for everybody."
He suggests treating your venture as you would any other business, and utilizes background and credit checks to vet potential tenants.
"Once you hit that point of financial independence, that's when you can really start to get really, really wealthy because you can start taking risks that people who aren't financially independent can't take," he concluded. "You then are playing to win, rather than playing not to lose."