All Forum Posts by: Brandon Weis

One issue I see is when you "buy them out" of the loan, the whole loan will be due per the due on sale clause in the mortgage. The bank will likely not let you assume the note, especially if your parents are the one living there - not you. It is not the end of the world, you could get a new mortgage on the property to pay off that original loan, but it will then be treated as an investment property so you would need 20-25% down. If you use the same lender and have a relationship, they will probably let you use equity in the house as a "down payment" but if you put 3.5% down on an FHA loan, you likely will not have that much equity, so you will need a considerable amount of cash out of pocket to "take over" the loan.

I find this result interesting. Yes, most people's most valuable asset is real estate (their primary residence). But a large percentage of the population that owns their home does not tap into that increased value or even knows what it is. An unrealized gain on someone's hypothetical PFS, that they are not even aware of, does not actually do anything for their wealth if they are not using it.

Given that most common people do not grasp real estate as an investment like Bigger Pockets users, I'm surprised stock investments were not the top voted answer.

The company we always uses lets us know the payback ratio based on the expected bonus depreciation from their estimates right upfront. It makes our decision very easy and cuts right to the point.

Careful Makellis! You'll bring more people to our hidden great metro! Joking aside, we do believe Lima is a great market to invest in, and we will continue to grow here in both units we own and units we manage!

Most important things for a market:

1. Jobs

2. Jobs

3. See #1 & 2

In your opinion, as you are starting out at 0 reviews, do you think it is a must to beat the competition on price to overcome customer's hesitancy or lack of trust with no reviews?

Or what are other tips to start gaining traction from the beginning?

I think it would be beneficial to set up your own management company to manage your assets. It can help keep things straight, and it would look more legitimate to lenders, buyers, investors etc. Anyone that is looking at your assets is always going to need to factor in property management, so you can show that as a real expense (and really make it as high or low as you want).

I work in a vertically integrated real estate and development company, and I cannot imagine how things would run if we did not have an internal property management company that essentially works for the other companies but also stands on its own.

Does anyone have a recommendation of a national collection agency that is effective? We have tried multiple local collection agencies, and we have not received a penny for over a hundred thousand dollars of bad debt submitted to them.

We keep hearing, "It takes time" but it's been well over a year with the most recent one.

@Nathan Gesner on your section where you say "The backup plan is to have a strong lease. If the tenant fails to establish their own policy, enroll them in your renter's insurance policy and charge it back to them. If they fail to pay, then you can choose to try eviction or just hold the charges until the end of their lease and collect it from their deposit."

Can property owners or property managers enroll a tenant in a renter's insurance policy and charge it back to them? I may be incorrect, but I thought that was not a possibility. If it is, we may just do that from the beginning in order to not rely on tenants to do it themselves. 

We have historically had in our leases that renter's insurance is required, but we had been lax on enforcing it because owners didn't really care and not all tenants had it. We are now beginning to crack down more as some insurance companies for property owners are asking for copies of all renter's insurance policies to issue liability coverage on properties.

Aside from having in leases that renter's insurance is a requirement, how do others actually enforce the tenant getting it? Do people require it before signing the lease? I feel like that sounds simple but in reality would hold up the leasing process for tenants that are not proactive. 

In order to encourage tenants to get renter's insurance, we have been contemplating instituting a $50 monthly fee until they provide proof of renter's insurance with the owner listed as an additional insured, but not sure how well that would hold up if we ever had to evict.