All Forum Posts by: Joe O

...you wouldn't make a deal like that. That'd be terrible. Essentially you'd only want to take over their payments if it's less than the property can bring in, after expenses. Ideally you find someone who owns it free and clear, so you can work out whatever price and terms work for both of you.

Run the numbers on that.

$800/mo rent. 50% to expenses. Cash flow $400. Minus debt service of $1000. You're cash flow negative $600 dollars each month. Ugly.

K is not returning your calls or emails. Have you approached the husband - your former Realtor - about the problem?

What would be the advantage of purchasing that early?

Do you expect purchase price to be significantly lower at that time?

Low enough to account for the extra costs (interest paid - or not gained if bought with cash, utilities, potential theft/vandalism, potential winter problems such as frozen/burst pipes that are now your problems, etc).

At this point I don't think you can trust what K or the tenants are saying.

I think you will make more money (or rather lose less, same difference) firing K right now, proceeding with talking to your lawyer and paying $1,000 for the eviction.

I know it's tempting to have K do it, as it's her mess, but clearly she isn't responsible. Time to take matters into your own hands, and put it on someone who is responsible, a good lawyer.

If your rent is $1700/month, if K/tenants drag this out more than 3 weeks you're losing money. Pay the $1K now, evict them yourself. Then get it rented ASAP. That extra month's rent you get from the new tenants by not having this dragged out will pay for the lawyer's services.

Good luck! Sorry for the rough first experience.

Standard disclaimer: this is not legal advice. Even if it were, you shouldn't take legal advice from strangers on the internet. Go talk to a lawyer. Now. :)

Hmm, all these people saying it looks great.

What am I missing? Basic numbers I'd run on this:
It's just under the 2% rule, but more like 1.5% with the HOA fee in there. Not bad, but...

Rent of 670 leaves 335 after expenses, using the 50% rule. Even if you say expenses will only be 40%, because of cheap taxes and insurance, that leaves you 402.

Minus 143 HOA = 259. Minus your debt service of $297/m, you're cash flow negative over the long run. After putting 20% down.

Better hope for appreciation on this one.

What did I miss that made this multiple people say this looked great?

If it sounds too good to be true...

Title company is negotiable, and likely specified in the contract. You could lose the EMD if you back out due to the title company, if you agreed to use them in the contract. Contact them first about getting the fee removed.

It sounds like investing in your area may not make sense. Are you dead set against investing elsewhere, where the numbers would make a whole lot more sense?

Please elaborate.