All Forum Posts by: Dee Georgian

Coming into the closing scheduled for next week on a single family home and the lender hit us with some repairs required prior to closing, or place money in escrow yesterday based on professional licensed contractor quotes (a sample list below of the numerous items they requested). This is a first that we have seen a “Conventional Loan” require this level of detailed repairs prior to closing. I am a buy and hold investor and always have repairs made or escrow reasonable ones that are a safety risk, but not looking to tie up money for these as some, such as the windows, doors and the counters we budget for repair only not replacement as they look fine just the seals need to be redone. The realtor sent across the actions requested to the seller so they are away, and we are gathering additional quotes.

We went through our due diligence process already and inspection and noted all the items we ourselves plan to addressed well prior to this coming up for our own due diligence

Would love any thoughts on how to address or if others have seen this change in Conventional Loan lending practices?

From the Lender (Bank)

See Repair Addendum and Supplemental Addendum.

1. Removal of debris
2. Replacement and testing of underground components (instead of installation)

3. Cost of bringing an older house in compliance with current code.

Addition:

1) Repair/replace damaged soffit & siding at garage, at chimney, at rear and sides of home and at front right corner due to minor rot, borer bees and damaged and broken siding and soffit holes to seal substructure (Replace all missing/damaged siding/soffit)

2) Replace exterior door trim at right side door at back porch and left side exterior door at garage, seal & spot paint (door don't have to be replaced if trim can be patched & sealed)

3) Replace four windows along back due to rot, seal and spot paint as needed. Clean out dryer vent and add grated cover to dryer exhaust at side of garage

5) Repair water heater as suggested in appliance warning on counter in kitchen: "Excessive rust in burner compartment" to restore hot water function

6) Remove Shed as it appears to be sitting on the ground and is dilapidated

8) Replace carpet in back bedroom due to stains

9) Remove rest of exposed plywood under counters away from range and/or cover with trim to make it look finished

10) Patch & paint minor drywall damage/ water spots at ceiling and at entry to enclosed porch from interior and some other minor areas

From the Georgia area south of Atlanta and moving to New Jersey or New York area close to Manhattan with a transfer. Listened to the BiggerPockets podcasts which are very informative which led me to look for a property to rent for some time now where the good ones we get outbid or cash buyers. Looking at being a buy n hold investor for the long term to build up a retirement portfolio.

I would like to rent the property I have in Georgia again and also like to look to purchase another rental, but heard it is much harder in the NY area to do so due to high cost and rental laws. So thoughts on long distance land lording or are there really affordable places in the surrounding Manhattan New York area for the buy n hold investor.

Thank you kindly

Dee

@Colleen F. Owe 47K over what the home is currently. I like the idea of shifting the regular services on the property over to the tenants as opposed to raising the rent if there can be a tactful way of handling the process.

@Ron Feinsod renegotiating sounds like a good idea as I went through the process along with the government program right before the renting the property, and was denied. All payments up to date with a conventional loan with an interest rate of 4.5% which I believe is why I may have been given the no go. I can certainly look into it again on Monday to see if that is possible now.

@Wendy Noble thank you for the comment. Recent rentals for the level of home in the area are between $1550 and $1895. I am renting it for $1495 and will be the first to admit I was scared and needed to rent it quickly and failed to cover for the maintenance

Thank you all for the suggestion

2 years ago I was plunged into renting my property after a loss of a job and split from my partner in Henry county Georgia where the home is under water and I now own 100% of the property. However, even though the value has risen in the past year, it is still almost $50K under water of what the property is estimated to be worth and do not want to walkaway from a semi-higher end home.

Rental income does not cover the mortgage and the maintenance on the property, so leaves me in the negative of about $200 each month. About $150 is due to HOA maintenance.

Existing rent is shown to be about $50 lower than what it can sustain (still will have negative flow). The lease agreement renewal is coming due in March and would like ideas on how, or should it increase as higher end homes have vacancies longer than others in the area. Renter has been there for 2 years with no issues (fingers crossed).

With the negative cash flow and still under water, thoughts on best options for a way forward?

Thank you

first I have to say congrats to you and keep it up. You certainly put some encouragement into those on BP, myself included, who have not made a move due to trying to stick to the 50% rule as a first time starter. Has been difficult to get that fire to take the first step outside the rule even with loads of calls and emails with little response from the MLS listings.

@ sounds great being able to get a 5 year ARM. Mark is that the same for your loans?

Excuse me if that information is elsewhere as I familiarize my newbie self with the site