All Forum Posts by: Matt Schelberg

Yes @Jimmy Samai that is good advice from @Frank Chin. In Maryland google “register of wills”. It is a public database of probate filings. If the family has opened the estate there will be a personal representative named with their address. That is who you should contact. 

If the family hasn’t opened the estate, search for the obituary, which will identify next of kin. 

I've been working on a purchase that's been under-contract for 12+ months:  negotiating with lienholders, opening probate, etc.  We are close to the finish line and a mortgage company has decided to get sneaky and it is threatening to kill the deal.  What can I do?

The mortgage company has decided to issue a payoff statement for a mortgage they released several years ago.  The release is recorded in the land records. The title company requested the payoff because they initially didn't see the release.   The mortgage company replied that $60K is owed and they won't communicate further.  Not knowing any better, the personal representative of the estate included that same payoff statement with the probate documents, so it looks like he is acknowledging the debt.

Now the title insurance underwriter is saying that despite the mortgage release, we can't close because the lender and personal representative have both made statements that the mortgage is still active.  Now we can't close unless the lender acknowledges that it is released...which they refuse to do...they wrote it off as a loss a couple years ago and are now trying to resurrect the mortgage to get paid.  

What can I do to resolve this title issue?  Can a lender really resurrect a released mortgage?

Well said by @Jeffrey H. Look at the compliance requirements before you begin your rehab.  Read through the new city inspection requirements. Decide what type of lead paint cert you want.  This will ensure you don't get slammed with a bunch of change orders at the end.

@Mike Rubin You asked about other rental markets outside the city.  There are solid rental markets in eastern Baltimore County in neighborhoods like Dundalk, Essex, and Middle River.  Many buy-and-hold investors look at the 1950s rowhouses in those neighborhoods.  They are well constructed; there is strong demand from both market tenants and Section 8. Employment is strong.  Low taxes, good schools.  And most importantly the price:rent ratio is very attractive.   

@Russell Brazil follow-up question to your post:  what are some good ways to identify realtors who do business in a given area?

@Mike Rubin Good analysis. If this is a rental property I would be more concerned with operating performance than ARV. Yes, the ARV will help ensure you're able to pull out your cash in the refi, but if you are holding for many years it is less important.

I recommend making some estimates of maintenance, capex, vacancy, and property management (even if you are self-managing) to determine operating performance.  The BP rental property calculator is good with this.  Avoid the mistake of assuming that "rent minus mortgage = profit".  

If your mortgage payment would only be $1,800 in Baltimore City (with its 2.3+% property tax rate) I'm guessing that your property assessment is significantly less than your estimate of ARV. What will happen to your numbers if the city decides to one day tax you at the property's market value of $330k? That is a monthly tax of $650.  That is what makes it tough to rent high-value homes in the city. (But it's less difficult if you are renting rooms.)

Good advice from @Ned Carey. People calculate ROI in different ways so make sure you understand how your realtor is doing the math. Her 8% may be different than your 8%. Specifically, ask your agent if she includes estimates of vacancy, capex, maintenance, and management fees in the numbers.

Not a ding against all agents, but in the end they are salespeople working on commission.  Sometimes their estimates of rental income may be less conservative than yours.

I added you @Leo Koonan, and sending you a PM

For Sale: Cash-flowing rental with A+ tenant 

Rent: $850/month, 18-month verifiable payment history.  Occupied by one of my best tenants. He has been late once in 18 months, and that was late by one day.

Lead-free cert (lifetime) 

Price: $54,500

Cashflow: $475/month (after allowances for vacancy, maintenance, capex, property management) 

The Property:  Located on a good block in a C-neighborhood where the neighbors look out for one another. Renovated in 2015 including new vinyl plank floor. A really solid property -- maintenance calls are extremely rare.

Repairs: None needed. My maintenance/capex total in the past year was only $252.  

Selling because I need to raise cash for another project.  Operating performance, BP calculator, tenant payment history (all payments verifiable) in Dropbox here.

For additional info reply to this thread or to be added to mailing list for future deals.

Price reduced to $220k.