All Forum Posts by: William Bannister

PS: I forgot to say AIRBORNE! I was Army back in the 90-91 Gulf war and we salute u for serving.

I am a bottom feeder myself and in order to stay out of dangerous hood i operate in smaller cities between 100k and 300k population these smaller metro area have less crime ussually and are still large enough to keep your deals somewhat more liquid then say buying a junker house in a town of 5000 people.
The key is buy a home or multi unit in a hood good enough that your know its going to be safe for you to collect rents and ect. It will be less headaches for u and management. The turnovers wont be a nightmare either. I paid 1200 for a house at a tax deed auction and it has an arv of 80k and I will put into it about 10 or 11k. the home will generate 650 to 695 rent per mo, tenant pays all utilities.
The reits are paying 10k to 14k per unit for middle class apts and I want to compete with them. I look at there numbers. If I can press a property into service for under 15k a unit.. and make 650 rent the reits are not much competition to me since my administrative costs are less. I am also able to react faster then they can to market forces being that I am smaller then they are. I can also pay cash on smaller deals like that;) No banker less risk and administration.
Under the 15k I get real interested, especially if the hood is a safe hood and homes are all valued high enough to make loans on them. Meaning this 50k is a starting point for most conventional financing. So make sure you can buy property that will be worth 50k when your done so your strategy will be possible when you decide to sell.
I like 3/1 at least 3 bedrooms and 1 bath for a minimum.. Call em bread and butter properties. Easier to rent too for demographic reasons.
If I am you, knowing what i know from 20+ years of investing I wait to buy until I can see it in person. Just keep piling up cash and when u get back then strike when you can see what your getting.
Otherwise you might be really sorry.
Hey if you are that afraid the US dollar is going to crash or lose value then put 50% of your savings into silver and gold bullion. My thought is the fundamentals of silver have never been better short supply and heavy demands and the Chinese have increased there purchases 500% in the last few years. Indians are also going crazy buying the metals. How can 2.5 billion Asians putting pressure on a commodity not cause it to rise faster then the US dollar. I see silver at 140 and ounce in less then 36 months. That is based on a stable economy is things get choppy with this fiscal cliff well who knows but beyond real estate its about the only place I put my money. this Monetizing of our debt w QE-1 through QE-3 may not cause hyperinflation but mark my word it sure will cause some 70's like inflation at the very least.
Now is a great time to have a pocket little side bet of silver gold bullion to add to your real estate.
Right now as we speak the Germans and Chinese have decided to change there ex currency of settlement from the US dollar to the Yuan? You think maybe they have an idea of whats in store for the US?

Thanks for the kind words Jeff. I enjoy in between traveling and real estate projects coming in this forum here to share with others+ I learn a lot too from others doing business and from other points of view. If this place had existed as well as a few others I when I was 18 years old my net worth would be 10 times what it is now. The info we trade in these forums is priceless.

Ha Ha no wonder I am so violently opposed to paying taxes...:)
To many rehabs in my youth under a cloud of lead based paint. Or was it the GMO's I am eating or is it the fluoride in the water?? Maybe its the chemicals I breath from the chem trails Monsanto puts in the air? Could it be the chlorine in my water or maybe its just asbestos I breath in as I rip up old flooring? Maybe its the paint thinner thats making me feel woozy?
No! its the fact that its already 12 oclock at night lol Good night all sleep well and have a profitable month!

Many states have adopted lead based paint rules that pre 1978 properties. When you rent them out must give tenants a notification of leads based paint activity form if you do work that will potentially cause lead based paint to become disturbed or removed.
Also they have a move in form that shows to tenants the dangers of lead based paint. and the last thing is the form they sign saying they received the other forms.
When I was in Milwaukee WI a decade ago or so I toke the lead based paint abatement course there they offered for about 1000 bucks and they state certify you for 2 years after you take test. It allowed me to do work on my own units I owned, things like changing out windows and doors and ect places you know those issues are going to be present.
I learned a lot about the clearance testing and how the work is performed and also learned how to keep tenants and employees safe from the hazards.
Over time more of these laws will probably standardize across the country to protect both tenants and those working in the field.
The most important thing as an investor I believe is to make sure when you do your due diligence on a property you plan to buy or put under contract you take a look at the folder the building inspector has on that address down town at the courthouse... to make sure there isnt or was not a red tag on the issue of lead based paint abatement or poisoning that may have occurred at that address. This type of thing will occur every so often if a child gets poisoned eating paint chips off window sills or ect. While having this lead based paint school isnt a prerequisite for investing its not bad education for people that plan to do a lot of rehabs. Its good to know your contractors if they are changing out windows are certified to remove lead based paint.
If your state has no laws on the books yet feel lucky but only for now.
Looking back: as a landlord its made me more aware to keep window sills in older units cleaner and I always employ a wet dry vac to clean window sills out before I give keys to a new tenant when doing turn overs on apts. Just the little extra 15 minutes of work you hand your managers or maintenance crew can save a little boy or girls brain!
That too me just makes good sense legally and morally.
On a side note if you live in the city where there are rules on this. Pay the money for the schooling in the matter get certified... Then building inspectors will help you get work if you visit them down town and ask them about homes that need abatement done.
Hint Hint all you outta work carpenters or contractors:)

The most under served part of the real estate property management field is the smaller under 4 unit buildings and you can use this part of the market place to build a portfolio of references. Give the smaller accts great service and a good price and then you can use them as references!;)
You might actually take on your 1st acct as a loss to help you grow and gain more customers!! About 65 million years ago when
I was a kid I mowed a neighbors lawn free and told the man if you like my mow I will come back every week for you for 10 dollars.
I landed the job because I swept his sidewalk afterwords the neighbor was hooked. I learned it from doing my dads houses. The standards achieved in your 1st few jobs can lead to many more profitable accts. My early days in real estate where characterized by earning cash doing management jobs to save for down pmts on my own rentals.
You might not make but a 150 per month managing a 4 unit for someone but it could lead into you managing a 8 unit down the street if you have a written reference from your early customers then a 20 unit or 50 unit and on and on!
Also contact a broker that sells large apt buildings by going online and looking for those that are for sale and take broker out to lunch and ask them if they would like to have you as a back up plan to any management problems there company cannot solve!
Another way to land accts is talk property owners out of state. How do you do this? go online to search assessor site in your city begin looking for outta state owners after u type in property address.
When your out on another job on the way take time to write down 4 apt building addresses on way to job to do research on ownership that night online assessor site.
another method is this call management company and ask them if they have problem customers they dont want and see if they will throw you a scrap or 2. I had one company they lady called me when ever she had a property under 4 units she said it was too much hassle doing the small ones. While they can be a hassle your looking to build up a client base and having anything you can call a reference is good in the beginning. Advertise things like no property to small too manage.
Good luck! hope it helps

Also I forgot if you want forms that work for your state laws here is an idea. Local investment clubs are all over the nation like where I live have they have whats called Indiana apt association. Where you are it might be different but anyways whether you get the forms from a local Realtor/broker that might have rentals or from an investment association or even your states Realtor association your having state specific forms will reduce legal problems later when you need to evict tenants or collect damages on there way out of your apts.
I use an application form and even if I have a tenant already in apt buildings i buy I have them all fill out that form if they are in my unit and plan to stay in it. Makes collections much easier when you have them on file.
The following forms are very important as a new landlord
1)application
2)condition report
3)lease
4)return of sec deposit form
5)3 or 5 day pay or vacate forms for collecting rents depends on your state. some call it notice to quit or pay or pay or vacate
6)i have forms for entry into building i post 12 hours in advance to unless its an emergency or considered common area. We call it
Notice to Enter:
7) also i always send pay or vacate forms certified mail reciept requested. for proof of service
Being detailed in the condition report is important!

Ask the tenants to produce the lease they had that they received before you toke control of the property. If they cannot produce a lease your both as landlord and tenant on month to month law by your state law. The key here is you dont have an agreement with them if they cannot produce an agreement aside from what your state provides under the provision of month to month tenancy.
If they actually produce a lease then as Jon stated you must abide by the conditions of the lease until the term is up on the lease.
Also on your hud-1 form that you got when you purchased the property it will show a credit to you in your column as the buyer for a security deposit if they had one. when I buy property I force the title company to show an accounting entry on the hud-1 document of zero if there is no security deposit. This gives me the ability to hang someone legally later if there are security deposit claims made by tenants after they move out. I also like to get proof from tenants after they move out that they actually paid a sec deposit to previous owners.
If tenant did pay a security and you recieved credit for it on your hud-1 form u are on the hook to pay back tenants if they leave...That is if they left apt ready to re rent:)
Meters are indeed a big issue and will go a long ways to explain who is paying what. So will a call to the utility company which really should be part of your due diligence when you buy property.
If there is no lease its simple approach tenants ask them to sign a new lease that shows they are responsible for x dollars rent per month and x amount utilities or garbage or what ever you decide. If they dont sign I hand them a termination of tenancy and begin eviction if they dont comply and move out immediately at end of month when its stated they are suppose to.
Regarding her agreement with banker I would tell her to produce it in writing. Most bankers arent renting out duplexes but maybe this has changed too with how they do foreclosures. Once you know if she actually has a written lease then you will know if u must abide by it or just start anew with new lease or new tenant and new lease.
There are a lot of ways to get rid of tenants besides just non pmt of rent. I would insist the apt and outside yard and basement meets health and habitation requirements of local codes. Also make sure they pay rent on time or viola you can void there lease evict and move on.
You can also evict unwanted tenants for police calls, noise violations, and dangerous pets and having business related activities going on in your residential property. The reason for potential eviction could go on and on but you get my drift. If there is a lease....
You do have to be reasonable and let them stay until lease expires if they are not causing problems and they pay on time as agreed. Your state has a termination of tenancy form as every state does which will start the process to get rid of tenant in the event they cannot produce a lease in writing. Jon and Jeff are both giving you good insight I might add to your issue here.

Personally no I would not rent to them! The chances that one of them would lose a job and not be able to support the rent is high since there focus is on school. The only way I would is with a co signer parent and a little extra skin in the game a a form of an extra months security deposit. I have been at it a while and can tell you they probably would not qualify for most quality student housing without the cosign and extra security. The scores? why so low when they are both so young sends a message of irresponsibility in paying bills and debts.
Is this it for applicants why not schedule a showing and get 2 to 3 parties to show up at once and get all three under application. This saves time and reduces the aspect of tenants asking for extras when they know there is competition for your unit. In todays market renters are easier and easier to find in the post sub prime melt down where more and more home owners are now again becoming renters.
The market will be stronger over the next few years as it takes time for the big reits and developers to get new units online to fill this demand. This in addition to the tight financing requirements for building will make your potential tenant base widen.
Work to get more applicants before you rent this apt try to find several applicants so you can pick the best of the 3. Our property managers are trained to do a little prequalifying over the phone when people call on adds it reduces showings and labor to occupy apts.
Prequalify is based on income and credit and time at job so fair housing laws are always followed;)

Welcome Raquel, its nice to have people from all over the country share there business ideas and market nuances as we all work towards our various goals in real estate.