All Forum Posts by: Brian Adzadi

@Tiana O.

I have not had many interactions with people on Section 8, but I have had colleagues who had rented out to Section 8 tenants. It seems HUD has its own standards on what they think is market rate rent for a neighborhood. Often than not they would pay higher than the average rent in the area. So whatever they say they will pay you for rent and it satisfies you, TAKE IT.

Follow up question: I am pretty sure you can ask the tenant or preferably the Section 8 program directors how much the tenant would have to cover.

Hope this helps.

@Reynald Jean

Did the mortgage company already give you the loan?

Normally the bank will do their own appraisal of the house and whatever the house appraise for is the loan that they will give you. If you need more money to fix or flip the place they then give you a 203K construction loan to do whatever you need.

So if the bank or mortgage company has not done their own appraisal, then don't start getting excited yet.

@Troy D.

I can tell you what we did when it came to screening and interviews with our rental and see if that's a good template to follow.

We placed an advertisement on Craigslist and Facebook with pics and info on the property. We also stated the requirements {No Criminal or Eviction background, make 2-3x the rent PER person, verifiable job number, minimum of 525 credit score (our area did not harbor people with the optimum credit score), and extra $25-$50 monthly payment for smokers and pet owners (per pet) its waived if pet is a verifiable service animal}.

When people call, we repeat info on the property and the requirements list. Apparently people don't read too often nowadays and you need to repeat things to them over and over. We don't ask them any pre-qualification over the phone, we wait for the showing to do that. If they agree, we set a showing. We try to group the showings on the same day and as close in time as possible; an hour apart preferably. If the person decides to go with through the rental then they fill out the rental application and give us a non-refundable fee of $40 for background check.

We used Mysmartmove.com by Transunion. They give you Eviction, Criminal, Credit and if their pay is X amount higher than your rent fee.

If they don't meet our standards, we make a print out of their report (Just in case they want to contest our decision) then text them that they were declined.

For married couples, each one must make at least 2x the rent because people break up and move out all the time, you need to make sure your rent can still be paid by the person left behind.

@Andrew Ryan

I am not a legal expert but a 60 days notice is quite generous because the most you need is 30 days. You are currently only 31 days or so into the eviction notice. So wait out the 60 days to maintain the stipulations in the lease. Once the 60 days is over, start contacting your lawyer to start the process.

But altogether the tenant is wrong and trying to scare you, they can smell a newbie a mile away. Start seeking legal advice now so you can be prepared when its time.  

@Account Closed

Then the argument against you again would be how come you did not verify if the tenant had actually moved?

Before you close they do a final walk-through of the property to confirm everything is still the same or if something was fixed as requested.

Why didn't you put in a contingency in the contract stating that you will not move to closing unless there is no tenant in the property.

This still looks like the onus is on you.

@Account Closed

I am not a legal expert here and I hope other more legally inclined BP members can chime in soon.

The argument against you would be how come you didn't do you due diligence? Did you not see the property for yourself to know that it was already occupied?

However, I still think you have an argument here. I believe the seller is legally obligated to make the tenant aware that the house is being sold so that the tenant could make their own arrangements. If that's the case with the tenant then I would think the same should go for you as a buyer.

What if you didn't want a stranger for a tenant and wanted to rent to family members instead? Or  were going to house hack? This whole deception would have kibosh the whole plan. I would talk to a Realtor to see if you have a case here.

@Marc Cesar

I see that you are a wholesaler. Why not use your skills to find cheap houses in decent areas of Rochester and use the BRRR method (I don't know your level of fixing and flipping, if you don't have any at all then this suggestion may not work for you).

For the BRRR method, you find a foreclosed home or a property that is very low in price like 20-30K but is structurally sound (foundation is good, roof is good, windows are decent) and only requires cosmetic work. Do a few touch ups to the unit (curb appeal, patch drywalls, sinks etc).

Since you bought the house cash its instant equity and since you did touch ups, it should increase the overall value of the house. This should increase the equity more. 

You then rent it out. You do a cash out refinance with loan company to take out the equity. Use the equity you took out to buy another property and continue on like that. 

If you have no skills or resources to do a fix and flip, then find a decent house in Rochester that you can buy cash which does not require much work, rent it out and then do a cash out refi to take out the instant equity you gained for buying it cash. Its the BRRR method, without the Rehab part.

@Brian Bradley and @Joseph M.

We are all speculating at this point. Let us see in the next 2-3 years which person's forecast holds true. I hope yours does @Russell Brazil.

Besides, I heard a lot of people who said they would move to Canada if Trump gets elected but I have yet to read a news article about a mass exodus of Americans moving to Canada yet. So who knows.

@Marc Cesar

Is it possible if you can be a little more detailed on what you want and are looking to do?

Fix & Flip or Buy Hold?

Single Family or Multifamily?

Leverage or Buy Cash?

Do you want to house hack or going to be going back forth to Brooklyn and Rochester?

 Is distance important to you or doesn't matter?

@Account Closed

IMO, overall its not getting easier. Depending on the market you are in it goes either way. For people in the Midwest, the housing stock is numerous that its a buyers market. However, its the complete opposite in the coastal states like NY and Cali. Financing requirement is one of the main reasons its not easy because mortgagers are much more stringent about who qualifies.

The amount of documentation I had to provide to attain my primary residence was ridiculous. If I had to jump through these much hoops to get a mortgage, imagine other first time homebuyers who are ill-prepared. 

Now lets also factor in the interest rates. We keep hearing how the Federal Reserve is going back and forth about raising interest rates. If they finally decide to increase interest rates, the number first time homebuyers will quickly dwindle and be a USA full of renters.