All Forum Posts by: Corina Eufinger

Oh, I wish I was closer. I love to play that game. 

When an owner contemplates the terms he/she isn't looking much further than the first 3 payments, so offering more for a total price might not be as big of an enticement as you think.

Don't underestimate the liability the owner is incurring. From his perspective there is the possibility you pay for 3 months, let the place go to #$%^, default, and now he has an even worse situation than just your defaulted payments. Unoccupied units (or non-paying tenants), deferred repairs, etc.

I know you said you lack the money for a down payment and can't secure bank financing (which I sympathize with). Focus your offer more on things like the down payment, and monthly payment that the owner can expect. Offer them some means of making sure their property is being kept up and properly maintained (semi-annual inspection where financing owner is present, monthly reports of cash flow, monthly bank stmts, etc). Acknowledge the large risk they are taking on and offer to ease their fears with it by any means you possibly can. 

I hope this helps.  If you need more ideas or help, feel free to ask more questions. 

Dylan,

For attorneys I recommend Timothy Evans or Diverson, Quad and Masini.  I have used Timothy Evans for evictions in Wisconsin but I know his is licensed in IL.   I have used Diversen, et al for Lake County evictions.  While I haven't used anyone for matters other than landlord tenant, they have been very good with communication and seem to expansive real estate knowledge. 

Most states will require you to carry professional liability insurance when you start a company and register it.  

What is your purpose with setting up the company? To give the illusion that you don't self-manage?  Tax wise you are better of taking an owner draw from your rental in most cases. 

Hi Edgar,

I worked for management company in Janesville that handled a half-way house.  In this particular situation the rents were guaranteed by a local organization that placed the ex-convicts so that was a nice setup.   Yes, your insurance will be higher. You probably won't be able to waive the terrorism rider or any crime riders on the insurance as well.  The owner had a strict no former gang member placement clause with the organization because those most consistently present problems, regardless of the convicts desire to rehabilitate. 

Consider what type of ex-convicts you will take (including gender and crime). I wouldn't recommend doing this with a property that is larger than 4 units as these do take more time than others.   You will need to help them cross back into normal society, its not a situation where you sit back and collect the rent.  For it to work for both parties you will have to do a little more hand holding and one on  one involvement than you would for a normal rental.  You will probably be handling more tenant disputes, talk the tenants through gaining their footing in the world again with money, bill paying, interacting with the general population, etc.  

All that being said.  it is rewarding if you invest the time with not only the rental but the tenants.  Seeing them "graduate" out of the halfway house to a non-halfway house rental (or even a home) is the best feeling you can have.  You know at that moment you did make a difference in someone's life.  When many others wouldn't of been willing to help, you gave them shelter and a fresh start. The payoff isn't just monetary, it's much more than that. 

Welcome to BP! Be sure to set up your key words alert so you are notified about activity in Wisconsin or specific strategies you are interested in learning.  There are so many resources here that it is almost overwhelming! Calculators, webinars, blogs, documents, and so much more.  

Good luck in your endeavors and be sure to reach out on the forums when you need guidance or a wee bit frustrated.  ( I grew up in Waukesha and plan on moving back there within 6 months, so its always nice to meet investors from there.)

SFR's are seen as hands off investments once a tenant is in. Tenant pays all bills, handles all the lawn care and snow removal. They do tend to stay longer than a year on average. Cash flow can be good when its occupied but when its not, your income statement kind of stinks.

Multi-families present multiple sources of income rather than just one tenant. There tend to be common bills (unless you find seemingly rare duplex where utilities are all metered separately), will require coordination of services (lawn mowing, snow removal, common area cleaning, etc), then there is tenant to tenant issues. Multiple rent income helps cover the bills even if one is vacant, capital expenditures like a roof are covering more than 1 unit (rather than replacing 4 roofs, you have only 1), POTENTIALLY more cash flow per month. But it is definitely a more hands on investment (or would benefit more from a property manager than a SFH).

Using your Dad for the purchase price is perfectly acceptable.  Be sure terms are outlined and offer him a good interest rate.  See what your local banks are lending at and offer interest similar. Remember that what you are doing is still a business transaction.  Don't treat it differently than a bank because they lender is your father.  That is how relationships can become fractured. 

How are you planning on paying for the rehab repairs? I'm assuming you have the some money squirreled away? If you don't perhaps you should consider a rehab home loan purchase through HUD.

I believe owning a property in another state is feasible.  However, I truly believe how successful it would be is determined by the presence of a property manager (and that p.m.'s merits.) If you have a full-time job, will you be able to keep up with learning the state, county, and municipality laws?  How would you make sure your investment has curb appeal throughout the year? If you need inspections done by a municipality (whether annual or otherwise) or housing program, how would you coordinate those? How would you conduct showings and move-ins?

Do you need a p.m.? No, you could get by without but its not a course I would recommend.  Having a p.m. that you pawn off coordination of repairs, inspections, leasing laws, etc to is invaluable.  The connections they can offer may bring discounts for services or better community connections.

 Some aspects of owning a property near where you live can be easier (you can check up on it, join local associations for networking and local law knowledge).   But you still have to be reasonably available to a tenant/prospective tenant if there is no p.m.  

If you believe a full-time job would keep you from effectively managing your property either locally or cross state borders, you should consider a p.m. 

Your welcome. Good Luck!