All Forum Posts by: James H.

That is a pretty interesting article and its title does not do it justice. There are a lot of interesting perspectives in there. The bottom line is, as is beautifully illustrated with the steel mill example, is that Americans aren’t going to break their backs day in and day out to receive wages that won’t support their living expenses. The catch 22 is that wages need to be higher, but higher wages means unaffordable products/food/services. The main driver of this paradox is only further reinforced as the disparity of wealth exists as it does and grows in this country and the world.

I charge because I pay about 30 bucks for credit and background check service. $30 adds up real quick agains my profits at 550/month rent.

I'm not sure I'm clear on what you are trying to do. Are you trying to climate control the little "room"?

The tenants are ALREADY THERE, leased to by seller, not current owner. Advice about screening is not very relevant here, except as a side bar.

I think these concerns about getting in legal trouble for harboring drug dealers are a little (a lot) overblown. Even if the (alleged)drug dealing was reported, OP would be lucky if the police department even kept a record of a report of a suspicion of drug dealing that he heard from someone else about someone else.

Really, just enforce the lease and evict if necessary, renew or don't renew based on if they are a hassle or not.

I am just posting this because I think its important that new investors who have yet to take the plunge should know what is a real concern vs a one in a million boogie man. You could never protect yourself everything, so it is important to know where to prioritize your concerns so you provide better protection for yourself and still make a little money. Worrying *too much* about the outside chance, rather than the likely and typical items, will stunt your growth.

If you are concerned about unknown contaminates, about the best you can do is pay a consultant to do a phase 1 environmental assessment. My company has a department that does these. The price varies, but for a single building property I think they would run in the 2000 dollar range. I'm sure some companies and independent guys can do it cheaper.

I've only had my tenants for one month, but when I went to pick up second month's rent (early) they had Christmas lights up, some paver-stone walkways installed and the house was cleaner than my own house! Better believe I am going to keep very good maintenance to retain this older couple! I hear the first 3 months are the best indicator of how tenants will perform. So far, so good.

Nathan, I saw you recently got your duplex. Congrats! I don't know that I would be too concerned with credit at your rent prices, but rather, be more concerned with rental and work history. One thing I loved to see was when applicants wiped their feet when coming in (I provide floor mats for my unit to help maintain the new flooring during the touch-up phase, and then I leave them for the tenants). We have our criteria which is very similar to Mike-0h's criteria. Plus, we made sure we felt warm and fuzzy about the applicants (as warm and fuzzy as you can be about complete strangers). I really enjoyed the whole process and learned a lot. I'm glad I started with something that I could afford to let sit vacant forever if I had to, because that took a lot (not all) of the stress away so I could concentrate on learning and not worry about big mortgage payments. Now I will feel 1000X more confident to use more leverage next time around if I decide to go that route. Despite not needing to quick lease it, we still had it leased the day it was ready for move-in. Just keep your eyes open and evaluate everything about them from the first word on the phone. One thing that helped me screen troublemakers was to verify they were not walking on an existing lease. It's easy enough to find this out when you verify the current landlord/apartment. Be very skeptical of people living with family or claiming to live with family for any period of their rental history. Ask questions, but don't lead. Pay close attention and ask more questions. Get them talking for a while and you can learn a lot about them. The more they talk, the more likely they will make little inconsistencies if they are being dishonest about or hiding something. This is a real luxury when you don't have so many units you can't be bothered with spending the time.

I agree with Mitch. I have shopped around mortgages for loans in the 50 to 60K range and the closing costs for a HUD home typically worked out to around 3000-3500, including the survey. Once you get below about 100K, or so, there is not much difference in closing costs, though. If fact, that is *one* of the reasons why mortgage lenders don't like to loan on lesser amounts - so, if you want a mortgage for, say, 25K, you can't find it because A)lenders don't want to waste their time on a trivial amount and B) they would have to lower their fees (which they will not once they get to a certain point) or else they would be subject to usury laws regarding high fees relative to loan amount.

If you are bidding on a HUD or REO, those fees need to be considered because the bank won't negotiate

I guess, since I would not be laying down any capital because I already own it, breaking even on cash flow might be worth it if I pocket a little money from maintenance and management and also get some mortgage pay down and modest appreciation. I know I am sort of answereing my own question, but just seeing what others think.

You do make some very valid points.

Maybe I misunderstand you, but I am not talking about renting a billboard. I'm talking about owning a billboard and renting it to others.

Clay pipe was used for sewage up to the 1950's. The material lasts forever, but it is very brittle and is susceptible to damage if disturbed. This pipe is constructed in (relatively) short sections so lots of oppertunities for leaks that can't and don't necessarily need to be fixed. However, these leaks attact tree roots and those roots will be nearly impossible to remove without breaking the pipe if they are clogging the line. Root growth itself will break the pipe. Usually if you have a problem with clay pipe, it results in replacing the entire line from the building to the street with PVC. PVC is cheap, but digging the trench and connecting to the sewer, permits, licensed plumber - not so cheap.