All Forum Posts by: Diego Mishler

@Chris Seveney Thanks for the advice!  After some thought, you're absolutely right.  The numbers are way tight and the tenant is dependent on all secondary income. We ended up saying no.

I have a prospective tenant applying for my rental property.  The market has been a bit slow so we haven't received many applicants lately.  This prospective tenant receives $3200 a month from child support, she currently has no job.  Her Father will co-sign the rent application and he will help cover her rent costs.  He gets a monthly income of social security of $1800.  We are asking for $2275 a month in rent.  

My management company has done a background check and it has come back pretty clean.  No issues with being sent to collection, no evictions, no criminal records.  They have credit scores between 645-680.  Would love to hear your thoughts.

Thanks everyone!  Your comments have been very helpful!  I'll probably end up doing 1 year leases at first and see how that goes.  Once I get more experienced with being a landlord I might consider month to month for flexibility I do like that idea.

in a month to month situation, is there no contract involved?  Something has to show that you're renting out to them MTM legally speaking I mean.  

We bought an investment property earlier this year and we have it on the market for rent.  We haven't found anyone to occupy the place yet, but we're hopeful that it will happen soon.  

My question is, what's the average rental lease, is 1 year ok, especially if you expect your operating costs to go up in year 2?  If you increase the price of rent, what percentage are you increasing it by?

You think if I contact the new loan owners they will be malleable and allow me to flip the property without the 5% penalty since they weren't the ones to setup the loan parameters?

Hi Jaycee!

We ended up going through mortgage broker who connected us with a loan company called JMAC lending, who did the initial loan terms and origination.  However, they did end up selling the loan to another company, but the people that own the loan I can't quite find a contact number for them.  The info I have for them is 

NWL Company, LLC
500 Delaware Avenue,
11th Floor
Wilmington, DE 19801

They use a mortgage service where I make my payments to, but they don't actually hold the loan, they seem to just collect my payments on behalf of NWL.

Hi everyone, I would like to introduce myself.  My name is Diego and even though I've been a member of Bigger Pockets for a few years, I haven't been really active.  Earlier this year, we purchased our first investment property.  From our purchase perspective, we made a really good deal.  We purchased the property for 260k and the market/appraisal value came in at 300k.  We ended up putting 80k down so the mortgage is 177k.  This actually would be perfect for a flip, but the mortgage company we worked with added a clause on the mortgage where we would get hit with a 5% penalty if we were to sell the property within 2 years of purchase, have you guys had anything like that before?

The main issue we have, is that we didn't properly analyze the rental market for the area, if we had, we probably wouldn't have bought the place to begin with, even though we had a really good purchase deal.  The cash flow will probably break even because we have a high cost for HoA which eats into our profits.  I'm also working with a management company to help because I actually don't live too close to the property, so they would charge me 8% fee on a monthly basis.  As of right now though, we haven't found a tenant, but I've since evaluated the area and I think I have the rental price just right, if I have to, I can tweak it maybe another $100.

I want to further invest in more investment properties, and one strategy that intrigues me is the HELOC approach. I'm a little scared about this approach, because the next property I invest in, has to generate enough cash flow to cover the property's operating cost plus the HELOC. Any tips on that front would greatly be appreciated.

To end, I'm really happy to be more involved in this community and I'm hoping to learn a lot more from the business.  

Thank you guys, this has been very helpful!

So I was reading an article where they were saying that money received from rental properties for example is considered passive income. My question is, if I have an LLC which I want to own my rental properties and the LLC gets taxed as an S-corp, would the money received from the LLC be considered passive or will it now be earned income?