All Forum Posts by: Bill B.

Make sure you have $10-$20k “extra” in cash for the unknowable problem that’s discovered. (Lead, asbestos, termites, water damage, not in code, etc etc. .)

You don’t want to get the house torn apart and in an unreliable condition only to run out of money to put it back together. 

Could Thai be the reason he lost his job? Can you imagine having him as an employee? What are his odds of finding another job with that attitude?

Good job following through with the PM. Hopefully they will say market rent is higher and you can raise the rent.  
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ps. I would raise the rent an additional $50-$100 (at least 5-10%) above market as a “hassle factor fee”. Especially if you had to hire this PM specifically because of thsi tenant. They shoudl be paying the cost of having them. Good luck. 

Because you’re asking about how to find a good tenant. You would know that before you would know what market rent is or how to correctly (and legally)  screen the good tenants that apply. 

You’ll be lucky to break even if you have 1 month of vacancy, before finding a tenant that pays every month and nothing breaks. You’ll need “perfect” to break even, on your first attempt to find/screen/place/manage? It’s probably less than 50/r0. Might as well just sell and go to Vegas. If you had a 5+ year plan and an experience PM you’d pry be 80-90%. But you’re already asking why you should involve an expert. 

If the association is causing trouble that’s a bigger reason to sell than rent out. I’d sell now while it’s tax free. If you insist on renting it out. Hire the best PM you can find or you’re going to end up losing money. And make sure you list it for sale within in the next 2 years.

Hey Chris. Quick question. You lost me when you said the 2nd got wiped out. 

Was that because the sale price was to low to pay them off, they wasted it on legal fees, was their entire lien declared invalid? Or something else I’m not thinking of. 

As I’ve said before. Your provide very interesting stories about situations most of us will never experience. Thank you. 

-Bill

With just a 5% distressed discount and 9% in closing costs/concessions. They never really had any equity on day 1, even before any interest, penalties, and foreclosure costs. Unless the 2nd planned all along to keep it if they have to foreclose I'd say anything above 80% LTV is living on a prayer as a second. Maybe they get lucky and the borrower stops paying the 2nd first so they can foreclose before the 1st piles up all the add ons.

Ps. @Dave Foster found out today I’ll be trying to sell/do another exchange today. Tenant gave 30 day notice on a home I don’t want/need anymore. A 3200sf 5bd/3bath former primary from the late 90’s. 

Click on the magnifying glass in the upper corner and you can fine 100’s of previous discussions/recommendations. Until you have more than 20 properties Quicken (quickbooks little brother) is cheap, easy, and overkill…

Reach out to @Dave Foster he literally wrote the book on 1031 exchanges and has been helping BP member here for years. He completed my only exchange in 2023. 

I honestly can’t believe nobody has started a business where they contact banks about this. Give me a list of all your loans below 3 or 4 or 5%, heck, maybe 6%. We’ll scan them all to make sure they haven’t been “sold”. FOR FREE. You give us 5%-10% of the “profit” from calling them due and re-lending (sp?) the money at a higher rate. Heck, the dream company even says they’ll handle that part for you. 

Some of these banks have money lent out at lower rates than they are paying on bank CDs. They’d love to have that money back. Too cheap to hire a company? Hire 5 “computer guys” (DOGE-light). Give them a bonus for how fast they finish the list so they don’t slow walk the process to Ave their jobs.