Property management went $20k over rehab rent ready estimate

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Rental Property Investor · St.Louis MO · Member since 2014 · 33 posts · 16 votes
6y

Unsure if Tough Love or Tough Crowd, but kinda blaming the victim here aren't we?

@James H.


Sorry to hear that man that is horrible overage / situation regardless of the cost of the property, or how often you went by to have a PM do that. Obviously I don't know the exact conversations or what they were fixing, but I'd refuse to pay over the original estimate without detailed accounting. 

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  • Real Estate Agent · Philadelphia, PA · Member since 2017 · 184 posts · 87 votes
    6y

    Was there some sort of contract?  Was anything communicated during rehab when budgets were being exceeded?  

  • Flipper/Rehabber · Montgomery, NY · Member since 2016 · 2k+ posts · 1k+ votes
    6y

    What was the job and what was the final bill verse budget. I would have something in place that if/when the budget/bid goes over it needs to be communicated to you before work is done. $20k isn’t a small number. You can lipstick Fix an entire house for $20k.

  • Member since 2017 · 10 posts · 1 vote
    6y

    They gave me a written estimate including what they called a "fudge Factor." Of 1,500, When I realized we were going over estimate they kept saying we're almost done it's just a little bit more work and we'll have it rented that went on for several months. Of course looking back I see lots of red flags along the way but I wanted to trust them and they were recommended to me by someone I trusted who now is no longer doing business with them.

  • Reno, NV · Member since 2018 · 39 posts · 6 votes
    6y

    By chance, did their bookkeeper accidentally add an extra zero to $2,000? Definitely ask questions and look at the bills.

  • Investor · Jasper GA · Member since 2015 · 1k+ posts · 1k+ votes
    6y

    How often did you visit the property during the rehab or is this a long distance deal?

  • Rental Property Investor · Central, FL · Member since 2016 · 950 posts · 821 votes
    6y

    @James H.

    Have you paid any money to them?   

    How about an itemized list of What they fixed or repaired or replaced. 

    How did you allow this to go on that far?  

    Honestly this is just a crazy amount... and a very expensive lesson on your part.  

  • Member since 2017 · 10 posts · 1 vote
    6y

    They billed me a little every month and when I realized it was over the original estimate and ask them about it they said it was almost done and will just be a little more but would never put a figure on it that, it happened 3 months in a row. 

    I know these were all red flags. No contract just the written estimate in the beginning. I have paid them every time they billed me. I have been asking for detailed records for the last several months and I'm not getting very far. They will give me a few receipts but no detailed, itemized work listed which leads to more questions and now I'm feeling that I have been the victim of a scam.

  • Investor · Indianapolis, IN · Member since 2017 · 145 posts · 158 votes
    6y

    It kind of depends on whether this is a $20k overrun on a $40k house (50%), or a $20k overrun on a $400k house (5%). 

    Either way, this is why everything needs to be spelled out in a contract. Either eat it, or talk to a lawyer. 

  • Rental Property Investor · St.Louis MO · Member since 2014 · 33 posts · 16 votes
    6y

    Unsure if Tough Love or Tough Crowd, but kinda blaming the victim here aren't we?

    @James H.


    Sorry to hear that man that is horrible overage / situation regardless of the cost of the property, or how often you went by to have a PM do that. Obviously I don't know the exact conversations or what they were fixing, but I'd refuse to pay over the original estimate without detailed accounting. 

  • Member since 2017 · 10 posts · 1 vote
    6y

    Thanks for echoing my sentiments. This is a tough crowd...

    I'm looking for steps to fix this.

    I have paid them most of the money because they billed me each month and every month they would say we're almost done, we have inspection scheduled and an interested tenant. Inspections always led to more items that should have been done already, Just a little more money each time they would say...

    should I threaten to get an attorney?

    report to BBB?

    file complaint with realtor board?

    ideas?

  • Investor · All over · Member since 2019 · 119 posts · 26 votes
    6y

    Like Pete Barrow said, either eat it or get a lawyer. In my experience, the BBB isn't really that potent of an organization. Same with the realtor board. 

  • Member since 2019 · 3 posts · 0 votes
    6y

    Damn...Sorry to hear that boss. Do you mind telling us what PM company that was so the rest of us don't use them?

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