All Forum Posts by: Andy Collins

You can look up the tax rate for the city, school district, county and any other taxing body (such as hospital district etc) and add them up.  In the Dallas area 2.7% is slightly high, but I always want to over anticipate cost.

I have a spreadsheet I use to evaluate deals, it figures the taxes as 2.7% of ARV, but chances are the current tax value is well below that,,but just in case, I have worst case built into my figures.

Insurance is also higher in Texas than most places,,,but  I know I get a better value (price to rent rate) for a good solid  house than in most areas of the country.

I use 2.7% of value as my estimate for property taxes (I'm in Texas),,its like anything else, its just part of the cost.

Before depreciation I made about $23k on 5 houses last year in texas,,,,so yes, taxes are high,,but it all works out.

I am a little confused why you would think you could get out of paying capital gains for a property that was held as an investment for 5 years...the IRS will also re-coop the depreciation you have taken over those 5 years at a certain rate (can't remember what it is exactly)

Are you sure you want to sell the property, if its cash flowing it might be worth keeping it and buying a house on top of that one

If your talking about getting a conforming mortrgage (30 year low rate), you must have 20% equity.  If a bank wants to loan you a portfolio loan (one they hold) they can do whatever they want, but the rates will be higher and most won't lock in the rate for more than 5 or 10 years.

You refinance to pull out equity because you have built equity in a property by buying right and rehab, however the deals you use to find aren't around today (at least here) like they were a couple of years ago.

Also are you going to put the mortgage in the investors name with their credit?  The bank will want to see the cash for the down payment in your account for 60+ days before they will let you use it.  They do not want you to borrow the downpayment, in fact you will be ask that specific question in the mortgage app,,are any of th e down payment funds borrowed

you can't not fix something that could be a health issue because they are in the eviction process, that could come back to haunt you.

"You" don't make a decision to pay a certain months rent with the deposit, etc,,,,go by your agreement, if they paid first, last and security,,,then when if they are late on the second months payment, file for eviction, they will be credited by the courts for last month and security deposit, but they are still late with the second months payment

I am very friendly to my tenants, but I explain when they move in, that this is business, and I have mortgages to pay, so if they aren't paying rent I will file for eviction,,,

I like what @Jay Hinrichs  said regarding hiring an attorney to review the policy (if you have the same policy on several houses he can just review the one policy if they are all exactly the same.

I have negotiated lengthy contracts for my 'real' work for years, I promise you there are times that one paragraph can be interpreted different ways.  I have had attorneys on both sides not agree on how to say something, even if we know what we are trying to accomplish,,so how in the world could someone not in the insurance industry really read a policy and understand exactly what it means.

I go through a new contract/policy and pick out the areas I want an attorney to interpret for me,,,but if you really want to know exactly what a policy will or wont' cover,  get someone that is either an attorney or that deals with those policies on a daily basis

andy

I got an e-mail the other day of a company that will provide software so that you could submit 200 offers in 5 minutes (I went back and found the e-mail to be exact).

In the wrong hands something like that could shut down the real estate industry with offers,,,,,,

in Texas each county has an appraisal district, they have websites that you can look up the information on any property,,it's not something that happens often, it was my first time to experience it, but it does happen

If they list a prior landlord check the tax records to make sure they person your calling actually owns or manages the property.  If they give the right name, you might ask the previous landlord how long they have owned the property (just in conversation), if they say something totally different from when the tax records indicate you might wan to really dig into that application.

I recently got a 'great tenant' response from the 'previous landlord",  problem is they weren't the previous landlord,  they were being evicted by current landlord for constant late payments,, its only happened once, but it was enough to make me very careful to make sure the 'dots all light up' between someone's story and the application.

If you have several new 'accouunts' opening up one thing that is hurt is your average age of credit.  If you have an American Express that you have had a long time (member since date), when you open a new American Express account, it reports the date of the new account as the year as your "member since" date.  It can help get your average age of accounts up by opening another american express (again, if you have an older 'member since date'.

Revolving  credit has more of an impact as far as balances than installment loans,,make sure you keep the total balances as low as possible, if your about to refinance something pay your cards BEFORE the statement cut off date.