All Forum Posts by: Bonnie Rakes

thoughts... i have been so screwed by Christian (pretend) friends. Leave nothing to TRUST... get a good re attorney to do all your partnership agreements so you avoid problems. 

Take some time to learn the pros and cons of different elements of investing.... for instance, you could fund bridge loans, where joe wants to buy property b, but still owns a, so he needs a bridge loan to fund the transaction. high interest... loan secured by property a, and or anything else he owns.... lots of legal, but money out, money in. I would guess 6 month loan terms. Good financial advisor, minimal hands on needed. Zero TAX SHELTER....  You could do short term loans as well... i would look at commercial, which often has balloons due in 5 to 10 years (whatever everyone agrees to). You can structure them to adapt to your life, do multiples and have the balloons coming due at different years (like they used to recommend on certificates of deposit) so you can decide if your want to extend it, or turn it into a higher return...  tailored to your life.  

Buy multifamily in nice areas, less maintenance costs overall with a higher class of tenant (for the most part), less turnaround.... get a good property manager... you should learn the basic ins and outs of management/maintenance to lessen the chance of getting ripped off... get references for management companies. NO CASH TRANSACTIONS EVER. You need to see ALL RENTS COMING IN... ALL INVOICES for CONTRACTORS...  Operating costs are tax deductible as is interest (at this point). You claim depreciation which lessens your tax burden for now, ( you pay uncle sam later.)

Buy vacation condos... I don't think you could buy on in branson and not make money. many areas already have built in rental management and housekeeping etc. 

You could fund new construction with a reputable builder.... split profits on the back end .... or maintain ownership of some of it....

I would leverage part of my money to buy multiples, not putting all my funds into one huge deal. By borrowing to purchase, you can control many more properties, as opposed to buying one. This spreads the risk. Again, you can sell as you see fit, not all or nothing. If you do borrow, make sure you are getting the BEST TERMS... If you have a large to show as collateral lenders will be slobbering to get your accounts.

100 ways to skin a baseball (just kidding), 100 ways to make money in real estate. You can choose one, or more... depending on your goals, life plans, etc.  GOOD LUCK.. better yet, GOOD LEARNING... luck comes and goes, education stays forever.

 PRICELESS>... TAX WRITE-OFF!!!

by law the realtor must present you offer. if he chooses not to, it violates realtor fiduciary. 

probate is a nightmare. if there is more than one heir, they might not realize how holding the property will cannibalize it's value... I would put together some numbers and tell the realtor i want them submitted to the executor, showing the costs of holding (taxes, insurance, keeping property protected from vandals (if any), ..  you can also ask to be present when the offer is submitted ... when i would do this, i would also compile a true list... ie: roof needs replacement  $12000 (include real estimates)  etc... to further justifying your offer. SCRIPT..." I know my offer is lower than you expected and hoped for and i certainly don't mean to offend you. .....    the property taxes on your mother's home are probably around $xxx per year (you already looked it up) so for every month the family holds it, you are pending $yyy dollars. "........ you get the point.  OF COURSE BE EXTREMELY SENSITIVE... someone croaked.

I don't put any faith in listed tax figures...comps are better.... for instance, in a town in nj, my $200,000 home was assessed at $92000. By jersey law, properties only have to be re-assessed every ten years. that unless sold (which updates assessment), it means the assessment numbers are ten years old. In settling my mother's estate, the attorney that drew up her will had a table that you used to determine actual value.. for instance, the assessor used a table to determine actual value, not tax assessment. So in my town the "factor" was $2.17, which meant you had to multiply the $92,000 by $2.17 to get true value. With values going down, that tax assessment might be right on the money, or value at the top of the market...  In other areas, the factor might be less than $1 for assessed value, so an assessed value of $200000 at a factor of $.9 brings that value to $180000 

LOTS OF VARIABLES TO CONSIDER... I would have to love the tenant to do it. Of course if he is taking good care of your unit, to catch up, you might just tell him "I need x% more per week and then by month y"; Create a schedule that he is confident he can do, and have him sign it. You could also try KEYS IN LIEU OF EVICTION so that if he gets behind by $xxx, he will move out and return keys.

I actually lowered rent for a tenant who had a job change. Three years in, they came to me and said they were probably going to have to move out, because she got laid off and new job paid less....  things i considered: They kept the place CLEAN. (They were into goth, black hair and nails, tatts, etc, but GREAT TENANTS... picture of them with grandma on the wall :)   I had to consider the month or more rents lost if they left.. they leave end of month, i can't do a turnaround in less than a week or two, so by the time i advertise and get a new occupant, 30 unpaid days blew by. I have costs to clean/paint/whatever, OOPS WENT IN THE HOLE ON THAT ONE.

CONSIDERATIONS....Do you have a good security deposit? --If he pays weekly, you only hold "one week" advance rent, not four. I would re-write his lease for a shorter period of time and spell it all out so you aren't giving up any of your legal rights. Make sure he still has to give you 30 day notice if he's moving out. If you do the weekly rents, he will automatically need to pay higher rents to cover "nuisance" "additional book keeping" "time spent". BUT... Don't forget, if you divide his monthly rent by 4 to set his weekly payments, you already gross more... instead of $9600 ($800 x 12 months)for a year, since there are actually 4.3 weeks in a month, you now gross $10,400 ($200 x 52 weeks).   To lessen your time required in this deal, i would try to do auto draft from his pay to my rents account, or make him deposit his rent in your account so all you need to do is go to online banking and you know it's there. I have also done a month where i did paypal for rent.

we would stress LISTEN to your CLIENTS. My husband was a realtor, and i would scope out investment properties not listed for our own purchase. There are too many realtors who take someone from showing to showing to showing to showing, and never quite show them what they want. Once you feel you know what they might want, you can always quickly swing by these properties to check them out, thus eliminating the nuisance of coordinating, trekking around, etc.  I am from NJ, and up there they have an "exclusive realtor contract" which realtors would ask clients to sign. The client would be let out of the contract upon a request, written or verbal. The object was that many people don't realize that even though a realtor works for one agency, they are able to show any home listed by any agency. Many buyers will call ten realtors and not understand that. There were a few that would take up hours and hours of my husbands time looking at homes, and then go to contract using their brother bobs second cousin on his stepsisters side, you just worked for nothing....

LOVE THE DOG IDEA.   When i was at properties, whether showing or looking, i made sure my husband knew exactly where i was going and who i was meeting. If i was showing, i would wait outside and tell them to check it out. Of course you have to be very conscientious if there is a tenant there who of course is missing their kabillion dollar ring after you were there... tell them to stash the family jewels.   If you are showing, you can also carry your wasp spray because you are "ALLERGIC AND SAW A WASP LAST TIME YOU WERE THERE"... don't have my carry permit yet, so i keep wasp spray in my car.... 18 foot distance :)

 It's no different than any job that puts you in a vulnerable situation....

MY OPINION//// I DISAGREE.... per one of my mentors (a free instructor at our REIA group), no one is buying homes between thanksgiving and super bowl sunday... so, there are probably good deals out there... always look for the ones that have been on the market longer, as those buyers are tired of paying for the property and or not being able to "move on" in whatever way they want. If you are rehabbing, go for it now. While i was rehabbing/ flipping, i would strive to be in and out and done settlement in 2 months. Once we got the big things done, we would start to advertise and show. Of course you may have to help people use their imagination to see the finished product via carpet samples, tile samples, paint swatches or even a 1' x 1' square painted on a wall in the new color.... we also offered to paint/carpet to a buyers color choice once we had a signed purchase contract. IMHO, Fall is not good to be looking to fill rentals. tenants and buyers want to be in before school starts.

i'm in north central ok   ponca ... anybody inn this area?

prioritize. if that means project b only gets 2 days a week, it is what it is... DELEGATE