All Forum Posts by: Cliff Harrison

I have used Premium Property Management in Kansas City and they are honest and do a decent job.  They are very flexible with me.

Congrats Tim! Was that from Dan Reedy by chance? Sure i would like to get together - I'm in the Grandview area a lot. I have a SFR rehab in the Belvidere neighborhood going on now.

 Hi Jason - what do you like about Ruskin?  I don't personally like it and it gets beat on alot.  Are you doing well there?

Stay local and be patient.  Enough bad things can already happen on any one investment without even introducing Out of State and Turnkey risks and costs.

I would be happy they got rid of a pet and reduce the rent by the $15, under the stipulation that they can't add another pet.  While I understand those that enforce the signed lease to the letter and I think that is almost always the best policy, in this case you are legally taking advantage of a situation at the tenants expense, unless they get another pet.  I don't see it as a gateway situation, like waiving late fees or absorbing damages caused by tenant actions.

Hopefully over time making decisions considering fairness to the tenant will get you a higher percentage of renewals.  Even if not, you won't have to worry if your tenants are thinking 'enjoy my $15 you greedy skinflint' when they pay the rent.  If they had the remaining pet run over by a car tomorrow, you could still collect the pet rent but would you want to?  

Overall I would not turn off my moral compass in order to adhere to the lease 100% in this case.

I did find a smaller regional bank that is loaning at 80% LTV but they max out at purchase + rehab cost. Plus these are commercial terms - 5 year fixed then balloon 20 year amortization 5.25% so may not be right for your situation. I am stuck with commercial in any case with 19 financed properties.

 Best wishes on your journey.  We are fortunate to be located here in such a great market.

Cliff

 You could try P2P unsecured lending like prosper.com.  Your interest rate is pretty much determined by your credit score.  

I finance out at up to 80% LTV, but the lender caps out the max loan amount at purchase + rehab costs. So I can get all the cash back out if I bought low enough and rehabbed efficiently and do it again, but I can't add to the pile.

Both are great options for you. LOC only incurs interest when you put it in play is a plus. Rate may be tad lower on refinance. I think risks are close enough not to be a determining factor and you have more than enough going for you to do either. A nice thing about being able to access your home equity in a big chunk is you can use the BRRR strategy without hard money. Get most of your cash back out and do it again or with a 125k warchest you can do more than one at a time. I burned up quite a bit in downpayments buying move in ready or minor repair when i started. They werent bad investments but now i better understand the power of buying distressed and fixing. I think of them as free properties since they end up costing nothing or very little out of pocket and you still have good equity if you bought right and rehabbed effectively. Good luck.

I would do a home equity line of credit and use that for REI. In fact that is how I got started.