All Forum Posts by: Anthony McEvoy

Are they looking for you to pay them and then still live in the house?

In general, it is fairly common to use money from the sale to put towards the purchase of a new property.  It is typically how people afford bigger homes.

@Lann Smith - call small banks in the area you intend on investing.  Each bank is different and the smaller banks tend to be more willing to work with balances of that size.  This past week, I called 5 banks.  Two of them wanted to do business.  The other three either did not call me back or were not interested in adding single family rental properties to their lending portfolio.  Big banks tend to only want to deal with 6 figure or more loans.

Investors who take the "academic" approach are more likely to partner with you in the future if they decide to move on.  Most of us know there is plenty of real estate to go around.  If someone uses you as an "academic stepping stone" and you treated them right, you greatly improve the chances they would pass you a deal or help you in the future if you are in need.

Hello @Thomas Hull - I highly recommend reading The Book on Estimating Rehab Costs by J Scott or some other similar resources.  It will give you price ranges to the work.  From there, you will only get a true idea of the cost by asking contractors.  There are things that will vary the cost such as the age of the home including the last time it was updated (if ever), location (including access), type of finishes, etc.

@Todd Ashley - I would update the lease so that it is with you and it is your language, not the previous landlord's language.  I feel it is one of those things that if there are no issues... it does not matter.  However, if there is an issue, then the contract language will matter all the way to the dotted i's and crossed t's on both sides.  Honestly, it would ultimately be best if you consult an attorney that is well versed with the laws in the area your property is located.  A few hundred now compared to potential thousands later?  Also, you would hate to have a vicious tenant that nails you on changed laws that you were not aware of... I have a buddy that got raked over the coals in the City of Chicago over an old lease.

Another thing is ask a property manager for a sample lease in the area your property is located.  If they are a big enough company, they have a sample packet ready to send with little hassle since they probably get enough requests for property management services.  I do use a property manager and when I was interviewing them, their lease mattered in my decision.

Beverage - for sure!  I find it interesting meeting other BP folks when I travel or when people come to Illinois.  I am not sure if we are going west this year or if my relatives are coming east but I will let you know!

@Account Closed - I know your pain.  I did two things when I had the same struggle.  I physically went to their office to try and catch them - I had luck catching one of the guys and his schedule was way out there for my timeline.  The second thing I did was go through someone else that had a relationship - in this case, it was a property manager.  I paid a little extra but it got done in a timely manner - time is money... right?

One time I paid a couple hundred dollars more than other bids to a roofing contractor for calling me back the same day.  A little nervous about desperation and needing work but they had an overall 4.9 star review on Google.  Two other bids came in after I signed up for their services.

I have always thought about starting a communication service for contractors...

Best of luck and let me know how you end up getting in contact with them!

@Todd Ashley - typically you need to honor the leases in place.  As far as moving forward depends on your strategy with the purchase.  Do you want the current tenants to stay?  (Are they good tenants - good payers, noise compliant, etc.?  Do you need to perform major renovations and cannot do it without them vacating it? etc.)  If you do not want them to stay and they are month to month, then scan to see what notice you need to give them. I have typically seen 30 days where I invest in Illinois.

If you want you do want to keep the tenants, then I would draft a new, long term lease.  You can make whatever changes you want to the lease.  Depending on the changes, it may drive them out.  For instance, if they have pets and do you not want to allow pets, then it may be a deal breaker.  Also, be conscious of the price increase if their rent is way under market.  You would hate to have a vacancy for a month or two if you raise the rent too much at once unless you know you can get someone to move in immediately at the desired rate.

In a nutshell... what are strategic plans?  Read their current lease since that agreement should be honored.  Be empathetic if you want to keep them.

P.S. - I love the Portland area... I have relatives that live there on the river.

@Mathieu Gagnon - Nice work... great find!  How do you determine your holding costs?

@Solomon Morris... this comes at a perfect time for me.  Thank you for sharing.  I am in negotiations and this will now definitely be a topic before closing.

Are there any other property management caveats you ran into with this transaction? 

@Sonia Captain

What part of Arizona? I see you are in Scottsdale... Do you focus elsewhere?