All Forum Posts by: Jill F.

Hi Hush,

Our bank requires 25% down on a commercial (non-recourse) 25year 5 year ARM. They calculate operating expenses at 50% of revenue. The deal must have a minimum debt service coverage ratio of 1.25. Plus they required us to document a fair amount of liquid personal assets to cover vacancies and other expenses for a worse case senario and to show a history of relevant business experience. You can probably get started much faster using w-2 income to obtain traditional residential financing (or even fha financing) on a 1-4 unit for a "house hack"

I hope you're not too old. I'm 5 years older than you and I just started last year ;)

I advertise on the off-campus mobile site of the local university for my apartments near the school. In my other properties, so far vacancies are being filled by referrals from existing tenants and I haven't had to advertise but I haven't owned them very long.

I have two side by side 1930 4plexes in a C neighborhood near a university. They cashflow 800+ per month each after expenses, mortgage, and capex savings. I'd recommend a deal like that to my kids.

B.S. in Natural Sciences and Mathmatics, UAB

This was one of the first things I had to learn to deal with. I bought a property that had tenants that had been allowed to prioritize other things higher than rent. My lease does allow for a three day grace period before eviction actions will be started. 

In Ohio, If you are going to insist that a tenant who has been allowed to pay late start paying on time, you have to first send a letter that says, "Regardless of what has been permitted in the past from now on you must pay on time..."

While a tenant is in default on the fourth day after rent is due according to the terms of my lease, I realized that I did not want to start eviction proceeding the first time a tenant is four days late. So I wrote a policy that encourages tenants to pay on time but does allow me to be flexible. I think it's a fairly generous policy but it limits my losses to 15 days rent before filing and it gets rid of habitual late payers that can't/won't get with the program. I allow a maximum of

• four late payments per year,
• 3 late payments in a row,
• two late payment per year greater than 7 days late ( and less than 15 days late).  

I keep track of lates in a spreadsheet. I do not count lates paid on or before the 3rd IF THE TENANT notifies me on or before the 1st that he'll pay on or before the third. I do wave the late fee the first time a tenant is late (but I make it crystal clear that this is a one time waiver)

I discount my late fee by 50% if a tenant notifies me on or before the first and pays th 4th- 7th as agreed. (lates still count)

When a tenant cannot pay on or before the 7th, I quit or pay on the 8th UNLESS the tenant gets on a payment plan. For a payment plan I calculate the daily rent and require that the tenant pay the late fee and enough daily rent to stay current through his next scheduled payment . Any failure to make an agreed payment results in an immediate quit or pay the next day.

Once a tenant has used the maximum permitted lates, tenants on a lease can stay if they sign a month-2-month agreement as long as they pay on time for the remainder of the year, and monthly tenants get a letter stating that their monthly rental agreement will not be extended (they will get a 30 day notice to vacate) the next time they are late. This policy has allowed me to be 

• consistent when dealing with late pays, 
• flexible enough to work with good tenants that have the occasional problem, 
• it encourages good communication with late fee discounts (I send out a letter saying next time you can save money if you let me know in advance...)
• discourages habitual lates (tenants save lates for 'emergencies')
• limits my losses (at most I'm out 15 days rent before I file for eviction)

I'm probably going to add a fee for the delivery of quit or pay notices in all future rental agreements.

@Josue Vargas

I'm sorry I accused you of trivializing this, I sure you did not mean to trivialize this social problem or this young man's death by your description.  And I certainly would never intend to disrespect this young man or his family in anyway. 

I actually thought about and considered the NON-IDENTIFYING personal details that I did share and I mentioned them on purpose because this was a young person that I knew, I worked with and I liked. I wanted readers of this forum to see him as the smart, personable young man that I knew rather than to think of him as a statistic, a 'suspected drug user', or as a 'problem' for me to deal with. Nevertheless, his death has created very real problems that I, as his landlord MUST deal with.

It is a sensitive topic. Peace.

@Josue

I respectfully disagree with your contention that a) there were inappropriate identifying details disclosed in this post and b) with the idea that one should not discuss, in a forum devoted to the issues facing landlords, how to deal with the problems that arise from an overdose death in a rental until. 

Last year there were over 4000 overdose deaths in Ohio. This problem will sadly be worse this year. Way more details are available in the public police records regarding these events than are described in this post.

It is a morbid topic. This topic is about practical problems that landlords face when dealing with the tragic loss of a life way too young. To call this creepy is inappropriate and trivializes the problem. That's MY opinion.

I view gold more as insurance than as an investment (though I've done okay with a few gold coins that are now collectible) and I like the idea of hiding gold in limited access locations better than using a visible safe.

I did read a memorable comment on gold as insurance once. It said,  "gold is for optimists, I'm investing in canned goods".

Hi @Greg H.,

Notice is not required in Ohio, but I plan to disclose anyway. There are 8 units in the two buildings and the other tenants know what happened-- plus anyone can search the Akron police report database by address. I'd hate to start out with a new tenant feeling like they had been mislead. In any event, if some superstitious people choose to pass on it, I really don't believe I'll have trouble filling the apartment; I have a short waiting list now. I did decide to go with a professional "trauma" cleaner in spite of the expense so I will be able to tell potential tenants (and their parents since these are primarily student apartments) that the apartment has been professionally cleaned and disinfected. I really hope that being honest works out; guess I'll find out soon. -J