All Forum Posts by: Holden Latimer

@Joshua D.

Thanks for responding! She actually is on a MTM lease currently. We renewed her lease in the winter to go through till the summer. We were hoping she would move out on her own, but it didn't look like she was planning on it. Then the broken hip happened. Technically all we need to do is give her 30 day notice that the lease will not be renewed.

I agree that the situation cannot work in the long term and we need to take a hard line now. To move the process along I am willing to do all I can to help her move to a better situation.

Hey BP nation. My wife and I bought our first property, a 4-plex, almost a year ago so we are still pretty green as for as land-lording goes. 

We have a tenant who we inherited from the previous owner that has a serious smoking problem. The tenant is a really nice older lady that pays on time and apart from the smoking issue is a fairly good tenant. Her lease clearly states that smoking is not allowed in the unit or common areas. We are owner occupying the unit directly above hers so we know exactly when she is smoking inside the apartment. We had problems during the winter and complaints from other tenants because she was clearly smoking inside due to the cold. We took a hard stance that she would be fined next time it was an issue and the problem stopped. This very well could have been caused by the warmth of spring, but gave us a couple months release from the smoke.

About 3 weeks ago this tenant fell in her apartment and broke her hip. She returned to the apartment about a week ago following surgery and in poor condition. In my opinion she should be in an assisted living center due to her recent surgery and overall extremely poor health. She has chosen her sister as an assisted caretaker but I don't think she is around very often. The last week has been almost unbearable. The smoke smell is extremely strong in our apartment and we are starting to get complaints from the next door unit. What would you do in this situation? Any advice would be greatly appreciated!

My thoughts: I was thinking my next course of action would be to go ahead and fine her $50 (per her lease) and open up communication about relocation. Again she is a really nice lady and hasn't caused other issues so I feel like my best course of action is to handle the situation with as much civility as possible. She really should be living in a assisted care type situation or at least somewhere where smoking is allowed. This would be best for all parties. I was also thinking of offering to pay for the moving truck and assist with her move. I don't know if this is a good way to handle the situation, so if I am being dumb let me have it! 

I have worked with Anthon Mecham with Authority Heating & Cooling LLC (801)885-8639 a couple times. My experience with them has been quite good, but it is always a good idea to get several quotes. Best of luck!

@Tarl Yarber

Another great success for you and your team! Great to see there are still opportunities like this even in a hot market like Seattle. Love your comment about risk. A good investment should still yield a decent return even if the worst happens.

Keep up the great work!

@Travis Fisher

Things have gone extremely well. We planned on getting in and making significant interior and exterior improvements. We timed the buy well with already significant lag in rents. In the first six months we have raised rents by about 20% and are already at year 3 of my initial pro forma. Last couple months CF has been close to $1000/month. Expecting to easily CF over $1000/month going forward (this includes our rent savings) and in about 2 weeks will be closing on an FHA streamline refinance that will decrease our monthly mortgage payment by about $250/month. Should be a solid start to our investment portfolio.

My initial strategy was to focus on long term buy and hold properties, but since I am young and cash poor I am starting to lean towards doing some shorter term buy & flip opportunities for my next deals. Would love any advice on how good the flip market is along the Wasatch Front.

@Patrick Ketchum

That sounds promising that your wife is a W2 employee. Unless she makes a significantly high income by herself though, it may be difficult for you guys to qualify up to the 4-plex level, but I would think you could for sure qualify for a duplex or triplex.  Sounds like you have the initiative to make it happen even though it may not be easy. I can tell you it is worth it if you find the right property! Again send me a message if you want contact info of the lender we used.

@Skyler Smith

Great advice. Creating good lender relationships is a real key to future success. Putting them on your investing "board of advisers" is an awesome idea. 

At closing I also was required to have a reserve of 3x the expected mortgage payment as part of qualifying. This amount was not actually collected; the lender just wanted to make sure I had enough cash on hand to weather major issues. You don't want to sink every dime you have into an investment. If things turn south you could be in trouble pretty quickly.

@Patrick Ketchum

Looking at your bio it appears that you own a company and are self employed? This may be your biggest hurdle in your ability to get a traditional loan. Most lenders are extremely wary of non traditional or W2 income especially if you do not have years of income history. Just something to think about moving forward.

@Tarl Yarber

Thanks for the update and pictures. Sounds like it was a lot of work, but definitely a good purchase by the sound of things. Congrats on your successful flip. Very inspiring!

@Patrick Ketchum

My wife and I bought a 4-plex in Salt Lake City just 7 months ago using FHA with just 3.5% down. It has worked out really well for us as our first investment property. Currently you are probably looking at a 4% interest rate on FHA.

You do have to occupy the property for at least 1 year so that is something to consider. Our lender also applied 75% of in-place rent towards our income for qualifying which also was awesome in allowing us to get into a 4-plex. PM me for our lender contact! Good to have another guy from Utah!

I second @Crystal Smith Until you get into the commercial property arena (5+ units) your appraisal will be primarily based on a sales comparables approach.

@Heath Green With that said, you should be looking at properties with an investor mindset which it sounds like that is exactly how you are approaching the investment decision. Expenses and cap rates really depend on your sub-market and the overall condition of the property. I would recommend connecting with either another local investor or a broker (who works with investors quite often) so that you can get a better handle on expenses and cap rates. Once you have a handle on these items you should be able to determine a reasonable price and your expected returns. Atlanta is a great market to be starting in. I wish you luck!!