All Forum Posts by: James Mc Ree

The contractors you need will be based on what the property needs.  You will have to first decide what you want to do.  For example, the hardwood floors are a bit worn.  Do you want to leave them as is, refinish them, install new floors or cover them with carpet?  IF new floors, what material?  These approaches are all appropriate depending on the condition of the floors and your desired outcome.  Your decision then leads to calling a h/w floor contractor or a carpet store.

My suggestion is you think about why you want to get a rehab if you truly know nothing about rehabbing, as compared to a turnkey property.  Hiring out a large amount of the work will be expensive and subject to a variety of contractor risks.  The turnkey has all the work done and is rent ready when you buy it.

I have been advised in the past that I can say I do not participate in the Section 8 program or that my property is not qualified for Section 8 and I am not interested in pursuing qualification because of the added expense.  It is essentially the same as declining a Section 8 applicant, but puts the focus on property qualifications and not the applicant.

You should ask the property management company why they will not disclose tenant information.  My guess is the seller has not authorized it and they cannot disclose someone's confidential information without authorization.

Check your purchase docs to see what information is required to be turned over about the tenant.  Required information is an obligation on the seller.  Sharing additional information that might be helpful to you could be a liability for the seller or property manager if the tenant can sue them for breach of confidentiality.

Ask the seller to provide the information to you.  You have no standing with the property management company as you don't own the property yet or have a contract with them.  The property management company works for the seller until the property is sold.

Could you get her to sign a document that she has moved out, taken all of her personal property and anything left is considered abandoned (yours)?  That would give you an abandonment case which should give you control of the property if it is defined in your lease.  You could then avoid the whole trial and related expenses.  Your tenant might go for it to avoid the eviction conviction.  Check with your attorney as I am not one nor am I familiar with Ohio.

You are only a week or two from legal judgement and control.  This wouldn't be worth it if it isn't straightforward.

Check the mortgage agreement for the owner occupied requirement. I think FHA is 1 year.

The interest is tax deductible provided the funds are used for a real estate purpose.  No deduction if you buy a car with the funds, but you have a deduction if you expand your current home or buy another.

I would ask for documentation for the expense, but it doesn't seem unreasonable.  It would be worth it to keep a several year tenant happy for years to come to avoid the vacancy expense.  It is a defect in your property that led to the expense.

It matters for building materials.  In SE PA, for example, pre-1950 homes often have plaster walls, lead pipes and obsolete wiring if they haven't been renovated.  They are reaching end of life on their soil lines.  These are all maintenance considerations for you.  Fixing drywall is easier than plaster.  Replacing that soil line up to the upstairs bathroom means cutting through some walls on the way up (those plaster walls!).  Knob-and-tube wiring is mostly gone now, but leads to a rewiring of the house if you want to upgrade electrical or install c/a.  Lead pipes can fail catastrophically with little or no notice.

Houses built 1980 or later (date fuzzy here) are typically built tighter with better insulation.  These houses will be heated and cooled more efficiently.  That becomes a marketing point for your property over older properties as tenants can live there less expensively or you can charge a higher rent.

Don't just look at appraised value.  Look at your cost of ownership and how you envision maintaining and enhancing your property in the years to come.

The lack of a credit score wouldn't concern me much.  Fully vet both applicants and focus on the co-signer's credit report.  Interview the applicant to get a feel for how he/she lives.  Check out prior landlords if there are any.  Ask some basic living in their current property, such as "Can you describe what it was like in your current place when there was a leak?"  You are looking for an ideal answer along the lines of, "I turned off the water and reported it to the landlord right away." as compared to "It didn't bother me much and I let it go."

I wouldn't rent to the applicant due to the short term.  Assume you will have a vacancy in 6 months and some repairs to spiff-up the property for the next tenant.  My properties rent for $1,200/mo.  An additional $150 for 6 months for me would not cover an additional month of vacancy.  Try to negotiate the applicant up to a 1 year lease.

@Kon Zel Of course!  That is why I wrote, "setting aside appeals and such".  At some point, there is an appraisal that "sticks" agree with it or not, but it is what buyers and banks will rely on.  The group of 8 would be the agreed upon value in your example.