All Forum Posts by: Donald S.

Unless he's a RE Broker he can't PM for you after he sells, in Missouri you need your Broker license to PM a property that you don't own, unless you're an employee of the owner. So you can tell him that, because if he does have Broker's license, I would report his slum lordness to the MO RE board. Also St. Louis County is pretty strict with code enforcement, you could always call in to them and see what they could do to help you out. If you have it under contract already, can you try to do bank financing so you don't need to worry about this seller after closing? 

As for keeping to his "business model" you could always agree in theory, and then once it closes kick him out and do your model. Unless you've written a contract to continue to use him, which I wouldn't do in your position. Good luck. 

 I would continue to shop around, but that looks like pretty good terms. And if it gives you what you need to do the deal then that's great. Let us know how it goes if you end up going under contract or closing. 

@Ray Harrell, If 1 month is typical, you need to move faster on cleanup. While I wouldn't shoot for next day, I'd keep it as quick as possible. Maybe a week if it required a lot of work, if not just a few days to touch up paint, new occupancy permit, make w/e small repairs necessary, then move it. We're doing a pretty large rehab on a unit now and with the large rehab it'll only be offline for 1 month (due to contractor hold ups). 

Well @Joe Edwards-Hoff, if you think this is something you wish to pursue, look into a Line of Credit on the rental home (and possibly your primary home as well). LOC's can be great ways to do the down payment on a property while keeping your 20k cash liquid to cover repairs etc. If you think the rental is worth 195k and you only owe 80k, you can probably get 70-75k on a LOC from a credit union or local bank. 25% down is pretty common for commercial loans, so at 350k you'd need about 85k. I'd do the LOC for 75k, ask the seller to carry back 10k on a 1 year note, or negotiate down the price if possible. Hope this works out for you.

I'm very interested to see how this plays out. Please keep us updated. and 4,500 relo fee is insane and there has got to be grounds to sue the city over that, but I'm no lawyer. 

This was an inherited tenant on a new property, and the checks for the bank account I set up for this building hadn't come in yet. I wasn't going to give them cash for in case they claimed I never gave it to them. And Cashier's checks are the next best thing to a check since the money comes out of my account immediately so I don't have to worry about it getting pulled at a later date when I might not have enough cash in there. Since these were inherited tenants, we received a credit on our closing for their sec deposits, and hadn't gotten around to separating the money into a savings account for that.   

did you show the seller where you came up with your costs? If you show him that X+y+z=W then his only argument could be A) your numbers are wrong, in which case you ask him for his actual numbers, B) the cap should be 4.4%, in which he should provide proof that the area demands such, or C) he's the swindler. 

Stick to your numbers, if they don't work they don't work. Move on. If he can provide you with actual numbers that contradict your own, then maybe rerun them. I don't know you're market so I can't tell you what it's worth. But 400k for 5 units seems steep unless its in a really nice area. 

@Thomas S. that's exactly what I just told them a few minutes ago. He seemed to understand so hopefully that's the end of it. Thanks everyone. 

Thank you @Chris Masons and @Eric James, I can't place a stop payment on the check until 90 days after it was issued according to the bank. I'll have my former tenants right out a request and keep it on file. In Missouri we also have 30 days to return the deposit or we can be sued for double. I do have text messages that they received the check and that they threw it away, so I should be covered there. 

Hi @Sundeep Bhatia and welcome to BP. You can always post here, but the "Financial, Tax, and Legal" Forum might be better for you. In my (non-professional) opinion you should be able to classify this as a repair expense since you said the deck was already there and they were just repairing it. Same as if a roof was repaired vs replaced. As for which year taxes it would go on, assuming you are a cash basis individual or company (most people are) then whenever the money leaves your pocket is the year in which it is expensed, so if some was in 2017 then that part goes on the 2017 taxes, and if some was paid in 2018 then it goes on the 2018 taxes. 

Hope this helps, and good luck. 

Cheers!