All Forum Posts by: Alecia Loveless

@Tyler Hardin Also don’t be afraid to reach out to the bank you do business with if it’s a small local bank. I’ve had very good luck with my local one where I’ve banked for about 25 years and have at times had more or less money with.

They have been helpful and considerate and have worked hard to make my deals go through as well as having both the senior lender and an associate lender working on my loans. I couldn’t be happier with them.

This probably won’t work well if you use a large national bank, but you can always reach out to a credit union or other bank and establish a relationship too.

@Omar Khan Every state I’ve ever seen the taxes have been on the listing sheet. If it’s an off market listing you can go to the city or county and get the tax card usually for $1.00 or a nominal fee. I’ve heard some people estimate 1% of purchase price but in my area that would be way off I think. I wouldn’t recommend it.

I’m also having a hard time estimating insurance. My last two came in at $1800 and $1900 for a 4 unit and a 3 unit. I felt $1800 was high for the 4 unit but it’s in beautiful shape so replacement was high. The $1900 I understand better, it is 2 houses.

@Laura MacDonald I’ve been going back and forth on a property, keep or sell as it’s appreciated by a lot. It would take me about 12 years in rents to make back what it’s appreciated in the last 14 months. But I could refinance it or just have a nice cash flow coming in. So many options.

Tonight I asked my partner her opinion because I’ve got another project I want to pursue and I laid out the cost benefits of the options for her and she said hands down sell, you don’t know what will happen 12 years from now.

You can pursue the other option, have much better cash flow, and not have to worry about another loan.

If I were you I’d look toward the future and sell and 1031 up to a larger property with more cash flow. It’ll be better for your retirement and provide more financial security down the road.

If your not comfortable going too big look a little bigger for something that’s $5000 more a month cash flow or something. A 12 unit. A 16 unit.

Best of luck!

@Alecia Loveless The septic inspection was only $500. Well worth for maintenance over paying for a new system. Also do not use a septic company, they will try to sell you things. Look for an independent inspector.

@Anthony Wolverton I’m closing Monday on my first multi with a septic. I had a septic inspection on it and learned a little. It’s on a 2 acre lot. There’s 3 units for a total of 5 bedrooms. The tank is 1250 gallons and the inspector said today for 5 bedrooms it would be required in my state a 3000 gallon tank. Units don’t matter. (It’s actually 2 houses) in the leech field, he called it something else no longer leech field, they’ve got a more modern name, one of my diverter valves had become crushed as the distribution box had disintegrated on top of it causing 1/2 of the field to be overworked making it now inoperable leaving maybe 15 years left on system whereas if it had been maintained there would be 25 years left.

Moral of the story if you build the units or multi and hold on to them/it. Make sure you do ongoing maintenance to the system. The longevity of its life is worth having it checked after the first 10 years and then ever 5-7 after that.

@Paul Petersen Hi Paul! If you felt at all comfortable with out of state investing, BP has a book on it, you could build a team in the Midwest, think KC or Cleveland, or Columbus, and hop right in with a cash flowing property think $50,000-100,000 with your $20,000.

There’s lots of great management companies from what I hear, investors agents, and both can help you build your team. They can help you find a property that will start you out with a positive cash flow that will also provide you with tax benefits.

If you don't want out of state investing I'd consider a small multi family house hack. One where you could get an FHA 3.5% down payment and the other tenants to help pay your mortgage.

@Kanwar Sodhi Do you want to live in it where you could do an FHA 3.5% down payment? I don't know if that would create other hurdles for you to jump or not.

@Jake Brockway I think it would depend on what you had in mind. We’re you planning on renting out one room of a 3/2 to a single person with 1 car and maybe an occasional boyfriend spending the night twice a month with a second car, for a total of usually 3 cars very occasionally 4 cars, you and your wife’s plus two? Or were you planning on renting out 3 rooms plus you and your wife’s room in a 4/2 to two people apiece for a total of 8 cars?

I think it’s all in the intent or possibly if you’re limited by space. Many families by the time their kids are in high school have 4-5 cars in the driveway or in front of their house, especially on weekends.

Where I live no one even consider that a problem as far as zoning goes!

@Carlos Lez The leases, prorated rent snd security deposits all should transfer at the closing. The bank’s lawyer or the lawyer conducting the closing should draw up an assignment of leases transferring them over to you legally. At least this is how it happens in my state. Check with your realtor.

You will need to write the tenant(s) an introduction letter telling them who you are, if you don’t want them to know who you are you should be able to say something like there is a new owner to the property, XYZ Property Management will be Managing from now on. How to contact whoever is managing the building whether that’s you or a property manager, who and where to send the rent to, how to let management know about problems, and anything else you would like tenants to know about.

I have been emailing this letter and mailing it to them.

I hope this helps and hopefully someone from California reaches out.

@Ryan Cornwall Also consider including possible exit strategies that are acceptable to both of you in the agreement. Appraise and sell, appraise and one buys the other out, etc.

I’ve had to force the sale of property in a partnership through the court system and it’s time consuming and eats away at your profit and can ruin friendships and/or family relationships besides creating a lot of stress.