All Forum Posts by: Aaron Vergason

That is good to know, @Chad Lopes Thanks.

In 15 Years I'll be set.  I was just hoping to have more cashflow so I could get my personal life debt free faster.  I wanna get rid of that Bad Debt, you know.

Probably not the answer you want, but it would be best if you could recommend to them to speak with their CPA. Or if they don't have one suggest one to them.  It really all depends on their specific situation.  If they don't make much income other ways, then a longer term owner financing would help them out.  Ask them (or hopefully their CPA can tell them) what income bracket they want to stay in, and structure the payments around that.

If you have no money to put down then they would have to owner finance 100% unless you could get money from a private lender.  

I'm wondering if they are only selling the property they don't really want anymore.  Most people don't sell their best money maker first.  See if you could buy the one that isn't on the market instead.  that will tell you if they are just trying to sell their tired dog rather than their golden goose.

Hey @John Johnson,

Check out what NOI is (Net Operating Income).

http://www.investopedia.com/terms/n/noi.asp

Then get the definition of CAP rate (Capitalization Rate)

http://www.investopedia.com/terms/c/capitalization...

Then you will understand what we are talking about generally. REI's throw around the term loosely sometimes. If I told you I have a duplex and it's a 10 CAP, or the capitalization rate is 10, then you would know that if you bought my duplex with all cash (no financing) you would get your cash back in 10 years. because you would get 10% back each year. If I told you I was selling the house for $100,000 and that it's a 10 CAP, you could expect to make $10,000 before paying a mortgage or having money set aside to pay income tax at the end of the year.

Typically the higher the cap, the more money you could make, but usually it's a more risky property or in a rougher area. High CAP is good if you can mitigate the risks.

Good Luck!

 I have read this far because this is exactly what I was thinking this whole time.  They came with the property, so they have probably been there a long time.  Long enough to have caused rotted floors maybe, who knows!  I'd tell them that you are so sorry about the situation, and you hope they can find another place to move to.  It's going to take you weeks to gut everything, check for mold, replace everything, get it up to current codes, etc.  And it's best if they find another place to live in the mean time.

This is no different than a fire at a house in my opinion.  My lease says that if the house cannot be lived in, then the lease is ended.

Talk to an attorney, and give them whatever notice is required to "Allow" them to leave right away.

How many people on here have put their tenants up in a hotel for more than 4 Days?

Some types of commercial loans can push you higher that 1/3. I bought a SFR in April that was financed through a local banks small business loan department. They took into account the amount of rent I was going to get to help offset the DTI. They did prefer I already have a lease signed, which I was able to do. When you get on the commercial side of a bank they hardly look at DTI. It's all about how good the deal itself is. They will run a debt coverage ratio on the property to see if it's a good deal on its own. They also would want to see past experience with being a Landlord. Maybe showing them that the Grandma will manage and she has a track record would be sufficient. Haven't tried that yet.

@Joel Owens my small city was ranked number one in highest appreciating markets during the last housing crash because it doesn't fluctuate up or down ever...A duplex that someone bought in the 90s for $50,000 (If it's still standing) still is bought for $50,000 today. That being said, rent has increased quite a bit since the 90s. My proforma NOI based on my budget is just over $90,000 so an 8 Cap would put my portfolio at $1,100,000. But I think a sale price like that would not be easy to find where I live.

I bought here because I live here.  Absent investors buy here sometimes but it's not usual.  There was a group of Australians who bought up everything here a few years back, and now they are all gone.

If I could find a refi bank that would do 20 or 30 years at a decent rate, I'd give them the whole LLC portfolio. 13 Properties, 22 units.

@George P. you are right that I'm making wealth "slowly".  Equity is building pretty good.  I pay almost no taxes per year on my w2 income at my job.  I just hear podcasts and posts about people clearing $200 to $300 per door and I'm not able to do that.  

Luckily I have always been able to keep everything going without putting personal money in except for very short periods of time, like a week or less.

@Doran Summers Sorry for taking so long!  Had some glitches on the App side of BP.

I'm in Upstate, NY.  My Rates are between 4.85% and 5.85%.  They are all 15 year with 5/1 Arms.

They are commercial or portfolio loans, but only one property is actually a commercial property (Over 4 Units)

@Jason V. and @Charles Preuss What do you think is making syracuse and rochester good markets to sell in?  Seems like people are fleeing our state of New York.  Who's buying these places up?

Welcome to BP I'm across the country working on my buy and hold portfolio. I'd recommend being conservative with your numbers because my optimism has made me buy properties that aren't great cash flowing deals. I've had some for almost 6 years now and haven't had to put my own money in them but I thought I'd have more cash flow than I do. Good luck and learn all you can on here. Also get in the game sooner than later because time on your side is your friend in the buy hold world. Get the tenants to start paying down your mortgages!