All Forum Posts by: Jacob Sampson

What are move in fees?

Have you put the property on the market to see how much interest there is?  I wouldn't make decisions based on emotion (fear, in this case).  A couple months vacancy is far better than a bad tenant.

That being said, you could ask them to stay a month ahead on the rent or something like that.

I think it depends on your goals.  The moment you start paying yourself it is going to slow down the growth of your business.  So, for example, if your goal is to pay yourself 100k a year then you need to not take any money out until the business can pay you that amount without any more growth.

My business partner and I have 40 units and purchased our first back in 2005 and haven't taken any money out yet (well we pay for our cell phones and internet, so we do take some).  We both have good jobs and our goal is to supplement our retirement and even allow us to retire early.  We have no interest in slowing growth, at this point.

You probably won't be able to get a HELOC since the home won't value high enough to support it until after you remodel it.

Is the seller going to transfer title to you before he is totally paid off?  If you don't have title you can get any sort of loan on a property that you don't have title on.

One move would be to purchase the home and then get a construction loan to support the remodel.  Once remodel is done and it appraises correctly then you get a traditional mortgage that pays off the construction loan and the seller and the house is yours.

What do you mean from tax benefits? For the most part everything shows up as income and expense. So, for example if you are talking about sharing depreciation, that shows up as an expense and shelters some portion of your profit. Ultimately, if the LLC shows a profit or a loss you will split that number in half (assuming partnership is 50/50 split) and it will flow to each of your personal tax returns.

In the future you need to stick to your guns and not allow pets.  Hopefully you at least are getting a pet deposit per pet.

1.  Remove the all caps stuff.  It just seems emotional and this is a professional notice.

2.  For similar reasons remove the part where you talk about being stressed at work.  It doesn't matter and has no place in this business letter.

3.  I don't think the story about insurance matters unless it is true.  Be an honest person.

4.  Hopefully your lease outlines that they need to take reasonable care of the property.  With the pet damaging the place they are in violation of the lease.  Check with your local laws and give the proper notice.  For example, in my area I have to give a 14/30 day notice meaning correct the violation within 14 days or be out in 30.

Keep it simple straight forward and professional.  Same goes for being noisy after hours.  Let them know they are in violation of the lease and give them the proper notice.

@Eamonn McElroy I stand corrected and humbled.  Does it matter the amount?  My experience is that if, say, the training was $400 it can be an expense rather than being capitalized. 

I don't think you would want to use a HELOC as interest rates on a HELOC can adjust daily. Can you just refi all the properties into a conventional commercial loan and pay of the current debt?

Yes this is common especially if the bank is going to sell the loan off.  Most of my properties are $35-$60k in purchase price and we use a local bank.  They have no problem making these loans.  I would just shop around to other banks in your area.  Local banks may be your best option.

As an investor I have both purchased and sold homes with tenants. Have you tried reaching out to a realtor in that town? There are likely several that work with local investors and can connect you in that way. Plus they can put the property on the local MLS. I find most of my deals through my local MLS.