All Forum Posts by: Agustin Conti

You could also keep those properties and use a HELOQ against them to have the downpayment for your Greenville property. Then payoff the HELOQ as quick as possible.

HI, I never said I want to give up 2 good properties?! how did you get that?. I just stated the fact that I have 2 and want to get a third one, a bit info about myself thats all. Thanks for the comment!

0 Votes

Greenville, South Carolina

Hi, I do have 2 rental units doing well in dif. states (I am from Florida) and I am looking to buy a Single Family Home for LTR in the Greenville Area of SC. I know these are not the best times for getting good financing deals and interest rates but I am ready to to move on and planning to refinance as soon as things get better. I have a credit score of 815-825, I am currently pre-approved for a 30-year fixed loan with 20% down payment at the following rates: (with an online bank)

8.125% Rate
8.708% APR

Plus! 3.4 points ($7,648) These numbers are crazy specially compared with 2 years ago when I got the 2 properties I have under 3% each.

IF the numbers allow for self support and or minimal cash flow I want to go for it and refinance later BUT the question is:

Is there realistically anything better than this out there? as of now (AUG 23) if not, when is the expectation for these numbers to get better?

Thanks a lot!

1 Vote

Greenville, South Carolina

Quote from @Daren H.:

I would imagine your realtor can provide you with an extension form which probably is just a few pages that detail what is changing (rent, term, etc.). I don't think long term leases mean much. The fact of the matter is if someone wants to leave they will leave and if they don't want to pay you they won't pay you. We do a 1 year initial lease then we let it roll into month to month. If the tenant has a great history and is the one pushing the issue for their own security then we will re-up for 1 year. It hasn't been a problem that I am aware of. If the tenant has had some flaky moments, we just let it stay month to month.

Yes, My realtor, who happens to be a friend will help me renew/amend the lease at no charge. My tenant and family are very good and he is asking for a multi year lease, I won't honor but I won't go to month to month, I am putting myself in his shoes, and I would not like that from a landlord if I was renting. Regards.

0 Votes

Fort Lauderdale, Florida

Quote from @Charles Holder:

@Agustin Conti

I charge like 500$ normally as a realtor to screen and personally vet, you can do this yourself, hope you're a good judge of character though.

I didn't bother reading the whole post, sorry I'm drinking.

Multi year leases are great, I give a slight discount if they pick a longer lease, turnover is the killer of cash flow.

The only scenario I regretted was when I went to refi. The numbers mattered more, I ended up not cashing out and did a heloc on a different property.

If your plan is consistent, extended leases are great. Especially if you have an ideal tenant.

Thanks for your input, I am surprised to see that your comment is the only one in favor of extended leases in particular scenarios.

0 Votes

Fort Lauderdale, Florida

Quote from @Ray Hage:

Quote from @Agustin Conti:

Quote from @Ray Hage:

As a couple people have stated, there is no benefit to a multi-year lease. Frankly, there is not much benefit to a one year lease either. I have 9 tenants and all are on a month to month lease except one because I have to do it through a HOA. I have some of these tenants for more than 4 years and I assure all of them very bluntly "You are welcome to stay as long as you want. Just pay rent and don't create problems."

With regards to rent increases, I let them know 2 months ahead of time that I will be increasing the rent through a text message and then about 5 weeks before, have them sign to the rent increase and maintain all the existing terms. Over 8 years, I have had maybe 2-3 tenants move out over a rent increase. Regarding how much to raise the rent, that can vary on a lot of different factors

Hi Ray, my current 1 year lease has an early termination fee equivalent to 2 months of rent in addition to the signed one year "commitment", what is more "beneficial" to you as landlord on a month to month basis? if you don't have this "coverage"

Generally speaking it is hard to collect it. Let's say at some point, your tenant decides to just leave without telling you (for whatever reason), how are you going to collect? It is going to be tough to chase them down and get it. Do you really want to spend a lot of time an effort to collect that rent. I just haven't found it to be that useful.

I am more fearful of getting a bad tenant who still pays rent but does many other stupid things on the property and having to wait them out till the end of a lease. To be fair, in my market, the rental demand is very high. I am not sure I would use this strategy in a lower demand place.

Hi Ray, This is a worst case scenario that does not apply to me or my tenant.
To everyone I still don't see (in my case) the benefit of a month to month, over a year. My time and mental space/health/peace are waaaay more important than thinking about tenants every month. thanks a lot for all the input everyone!!!

0 Votes

Fort Lauderdale, Florida

Quote from @Brett Voorhees:

I would recommend considering adding in to their responsibility for the property. For example "Any minor repairs or maintenance under $250.00 is the tenants responsibility." If it is a good tenant its still fine to raise rent but keep in mind the benefits of a good tenant. No evictions, they pay on time, take care of your property etc.. So by adding the small maintenance responsibility on them they will be more inclined to care for the AC, washer, dryer, fridge and water heater accordingly with basic maintenance. Cause what cuts into your profit more than anything will be repairs and damages.

Hi Brett, I agree with you and I already have that exact amount ($250) as the threshold for minor repairs under the tenant responsibility.

0 Votes

Fort Lauderdale, Florida

Quote from @Ray Hage:

0 Votes

Fort Lauderdale, Florida

Quote from @Ricardo R.:

Quote from @Agustin Conti:

Quote from @Ricardo R.:

@Agustin Conti great to hear you are trying to take a go at it yourself. I'll try to assist:

How to renew a lease with a tenant without a realtor: Basically just take the current lease you have now between you and the tenant and update the new lease term and the new rent amount.

What are the advantages of doing a multi-year lease: Advantages to you... none.

Agustin, this should be pretty straight forward just draft a new lease update the dates and rent and send it to the Tenant for signing. You should offer the entire lease just updated preferable BUT can also just send the tenant an amendment/addendum which just extends the current lease to whatever date you both agree on. Regarding a 2 year lease, there is NO ADVANTAGE to you and in fact it is actually a disadvantage to you. Under any lease (any term from 1 month to 40 years) the Tenant can literally walk-away tomorrow and the only recourse you have is to hold on to the security deposit (and maybe not even that) because basically no judge will force a tenant to pay for a term they didn't use up BUT YOU, can not do anything until the term is up/tenant terminates, you can not increase rent, stop renting, etc. etc. and is also more difficult to remove a tenant until the term is expired. My advise is stick to month-to-month or at most 1 year and no longer. I hope this helps. Thanks Ricardo for all the info, I find that knowing that

Thanks Ricardo for all the info.I am new a a landlord and I learn as I go. I find that signing a 2 year lease has the advantage of knowing I will have the house securely rented and I will not incur in expenses preparing for a new tenant, vacant time, realtor fees etc. I don't see how this is NOT a PRO (+), as far as the cons (-) if the tenant is good, the only reason I see could potentially be bad is the fact that they have 2 years to "destroy" the house instead of one. Something that can be mitigated by adding something along the lines, "subject to inspection after one year" or similar, the same goes to the rent price..I could set the price for the first year and add something that leaves me in a position to increase the rent by X amount if etc....This is the type of tips I was looking for.

Regards

@Agustin Conti I don't think you are understanding me or perhaps I'm doing a bad job at communication. Agustin, a '2 year lease' means NOTHING, because it is no different than a 1 year or 40 year lease as far as the Tenant is concerned... the TENANT CAN MOVE OUT AT ANY TIME AND YOU HAVE NO RECOURSE OTHER THAN TO KEEP THE SD (MAYBE)... so why offer a 2 year lease?.... there is no added 'security' for you...it's an illusion.. because again, the Tenant can break lease anytime they want. What a 2+ year lease does do is LIMIT YOUR OPERATIONS, you can't do anything aside from the lease during that period and your options are extremely limited. In regards to mitigation by performing inspections... yes you are thinking along the correct path BUT again, is there any 'bite' to that? what are you going to do if they refuse inspections... go straight to eviction? .... you need to start thinking in regards of escalation of force and leverage.

Thanks Ricardo for the clarification of your point of view, but what do you mean with "bite" to that?. But I still see value in considering that option, if you have a good tenant and you have provisions to increase the rent after one year. This is all very useful information.

0 Votes

Fort Lauderdale, Florida

Quote from @Ron H.:

Followup. I have never had a perspective tenant go away after refusing their request for a multi year lease. I just assure them that lease will be renewed as long as no issues.

Yeap, this is what I am thinking and I am not worried at all about them not getting the multi-year lease they ask. I would say the same thing: we will be happy to renew as long as all is good.

0 Votes

Fort Lauderdale, Florida

Quote from @Scott Wolf:

Quote from @Agustin Conti:

Quote from @Bill B.:

All you need to extend a lease is a paragraph or two.

The existing lease between tenant xxxxx and landlord xxxxx for the property at address xxxxx is amended in the following ways.

The lease end date is now x/x/xx with the rent starting x/xx/x to be and the rent starting x/xx/xx (a year later to be old rent plus even more dollars).

You want to find out current market rent and set your rent within 5% of that and then increase the rent to increase at least 5% a year from now for the 2nd year.

This can all be handled in half a sheet. This is also a chance to add anything else you forgot in the original lease. No pets, or pet rent, landscaping responsibility, utilities, length guests can stay, etc etc.

Sounds Good Bill, thanks, but I don't understand this: "You want to find out current market rent and set your rent within 5% of that and then increase the rent to increase at least 5% a year from now
for the 2nd year"

I am already adjusting (increasing) the rent 2.5% compared to the current lease. What do you mean by 5% then 5% and how to write this type of provision.Regards

I think what he means is you increase the rent for year 1, and have another increase at the beginning of the second year. A standard 3%, or tie it to the CPI. (consumer price index).

Thanks Scott!

0 Votes

Fort Lauderdale, Florida

All Forum Posts by: Agustin Conti

Agustin Conti has started 12 posts and replied 70 times.

Post: Looking for better financial options for an investment property.

Post: Looking for better financial options for an investment property.

Post: First renewal, Tenant ask for multi-year lease

Post: First renewal, Tenant ask for multi-year lease

Post: First renewal, Tenant ask for multi-year lease

Post: First renewal, Tenant ask for multi-year lease

Post: First renewal, Tenant ask for multi-year lease

Post: First renewal, Tenant ask for multi-year lease

Post: First renewal, Tenant ask for multi-year lease

Post: First renewal, Tenant ask for multi-year lease