All Forum Posts by: Joey Wharton

I have the same question. Looking forward to feedback.

I'm dealing with a structural issue that I did negotiate the seller from 195k down to $158k. I did hire an engineer, and now that we are deep into the issue other structural issues have been uncovered, so we are looking at almost double the cost. 

Tread carefully. Hire professionals, get your quotes and then double your budget. These issues can be a nightmare and eat up profits really fast.

Personally I think the best coverage is a Renter's policy. It covers not only damage their pet does to the property, it covers dog bites too, and a slew of other things tenants wouldn't be covered for. I used to charge pet deposits, but now I offer to waive it in lieu of renters insurance as long as pet / tenant damages are included the policy. Its a great incentive to get them to buy and honestly a great thing for tenants to have for their own sakes. Once they're aware of everything it covers, and the fact that my insurance doesn't cover their stuff in case of fire, etc., they WANT to get it. Win / Win.

thank you Curtis!

You've got my wheels turning. Greatly appreciated.

Don't we just love BP?

Hello follow BPers! 

I'm six months into a 2 year Lease Purchase on the current townhouse I am residing in. Owner is asking about closing unit now. I'd like to make a "buy now" offer and would love some suggestions on what to offer. These are the numbers:

3/3

Purchase price: 138,900 (within 1 yr), 141,400 (within 2 yrs)

Down paid: $5,000

Monthly rent: $995 (I clues taxes, ins, HOA)

Market value at time of purchase was $138k (6 MO ago)

Current value: 2bd/3ba, unit (same Sq ft), higher end kitchen on busy side of road was just listed at 161,900 went under contract within a week. Still pending.

I estimate value of this unit around $155k as is, projecting about $170k at the end of the 2yr agreement.

Current market rent $1500.

No mortgage on property 

Should I make an offer, she wants to sell now due to personal reasons. She's also asking about taking posession back. Or should I wait out the 2 year period? If I bought now I would want to flip it or continue to live in it for another 6mo - 1yr, but not turn it into a rental.

Maybe she's giving me a story since she realizes she sold herself short.

I look forward to the feedback!

2004 Volvo XC 70, 167k miles. Big step down from the Land Rover I used to drive when I was a 9-5er. Volvo is nickel and diming me so I thought about buying a sensible under 10k car. But, i was parked at a gas station watching a guy go to his "car payment" to get a smoke and then have to go back in to a miserable job to pay for his car. Good reminder that my life is great and my car is just fine!

Hi Spencer

I just bought a 5 plex through an estate. There are deals to be had if you put in the time. There is a duplex that I put an offer on the day it went under contract. It just fell apart and is back on the market. Great location in mostly SFR neighborhood. I've got the inside scoop if you're interested.

139k, Feeling it for 119k maybe less 

2- 2/1 with minor work could rent for 900 each.

Tenants pay utilities 

Clean, low maintenance property 

I was sitting in court just the other day on a non-tenant related issue, listening to a tenant / landlord have it out in front of the judge, basically the tenant was complaining of mold, repair people made many attempts to enter & fix, tenant refused all times, but wants to stay - and of course refuses to pay rent due to condition of unit. Obviously looking for a free ride. Landlord had everything documented, as she ran through the dates and events there was a clear escalation and it was quite apparent the tenant was just setting it up for milking out as much free rent as possible. Not saying this is your situation, however, whenever flags go up, grab your opportunity to get them out and run! Especially if your house is quick to rent. A few bucks of higher rent doesn't make up for potential thousands they can cost you in the long run.

That said, I am always really nice to my tenants. In my 15 years of renting, I've not had a bad experience yet (knock on wood). But I always talk to them directly and work around their needs, because a pissed of tenant can do a lot of damage, so I'd rather eat up a $100 or $200. I like them to see their landlord is a cool chick that can relate to them.  So in this case I would go talk to them, assess the damage, and tell them that I'm going to remodel that space to make it more usable and avoid any mishaps in the future (whether the case or not). My spiel would go: "I'm so sorry this happened, I see I'll need to remodel the space, unfortunately, I can't renew your lease, due to remodel, but how can I help ease your transition?" If they mentioned damaged items, I'm sure they are expecting compensation. They could be stalling repairs to tally up more damages on their side. If they say they're ok to stay during remodel, say your insurance won't allow it, or whatever excuse you need (that isn't your/their fault). Try to negotiate with them now in conjunction with terminating their lease. In my experience tenants are much more hostile to PM's than owners.

Currently I need to vacate tenants I inherited though a purchase - ASAP,  I can give them their 30 day notice and be done with it, but instead I offered to give them 1/2 the month free to vacate in 15 days, and return 100% of their deposit plus $400. Why? Because all the foundation work I need to do is in their unit and every day they let the contractor in to do all the exploration work necessary adds up to $$ I would be losing in rents on all the units that are empty until this structural issue is fixed. Tenants are happy and I'm happy. They're begging to come back when its completed and always greet me with a smile. So much easier and cost effective than dealing with hostile tenants.

My .02 for what its worth.

I'm a DR listener and have been 100% debt free for a few years (before I heard of DR) which allowed me to retire at 40 to have a baby. Now at 43 I wanted to "go back to work" but couldn't stomach the idea of a soul zapping 9-5 desk job. I decided to pull a loan on my house to buy a 5 plex. Because I don't use credit I've had to partner and find myself struggling to build credit. Yes credit is your friend in this business. But that's the catch - if REI were a hobby or side gig I would go cash, but since I went at it full time with a clear goal (double my home equity via REI in 2015) leveraging was the only way.

Like Buddha says "the answers are found in the middle."

I won't go more than 70% LTV and any investment needs to yield at least 20% on my cash.

Unfortunately most people don't have the discipline to live lean while to build wealth and end up over leveraged and all it takes is one hiccup for it to crumble. I think what Dave Ramsey is trying to teach is goal setting and the self sacrifice, discipline and laser focus it takes to achieve the goal. 

Marisa,

I will tell you own personal experience, being "THIS CLOSE" to buying their full program. 

I contacted someone off the CL ad because I was looking for a mentor, or group to teach me REI. The person who put the ad in was 2 hours away! She sent me the webinars and then I went with her to the cash-flow game, and had a ton of fun playing the game. It's great to help shift your mindset. The guy presenting was low pressure, seemed like a really nice guy and had a great story. He even pulled out an email from one of his students. This was in Denver, the host was flying in every week from Salt Lake City to host these cash flow nights.

At this point I was looking for education as I had been invited to a Nick Vertucci NVREA seminar that my friend paid $1500 only be pitched a $40k 3 day bus tour. I'll write about that experience on another post. Well one thing this did was light the fire to start with REI. Also I contacted the CL ad as part of my researching on NVREA on the 2nd day of the seminar, and I have to say that at least Renatus gave me an alternative to $40 because believe it or not, my friend put down the $20k downpayment for the bus tour! So 15k was looking a lot better and had what we were looking for a structured system with a network. So we were pretty sold from the get go.

I then attended another cash flow night, it was a big set up, he had 6 other people helping. Laid out a very similar spiel and pulled out the same email. It became very clear that he was making his money selling education not real estate. Just like the NVREA people. Its much easier to sell education and real estate. They will push you to get finance with them at 18%! Turns out they will help you fund deals at 18% too. The more I looked into the group the more I realized that they are priming students to borrow from them at ridiculous interest on crummy deals they make the bulk of the money on while you get to do the work. 

If this guy, nice as he was, was making money selling real estate and was so busy as he claimed, why was he putting so much effort and money towards selling education every week in a city a plane ride away? Because this is the purpose of Renatus to get you to sell education not real estate. They push you hard to sell their education. Yes their commission package is big IF YOU BUY THE FULL $15K (now 20k) program. It's not MLM and you probably will make money if you shell out for the full program - just know that your focus will be selling education - not REI. The lady who I contacted has yet to buy a property and she's been involved at least 6 months. Since I'm interested in REI - NOT selling education, I said thanks but no thanks, and bought a small apartment building with the person who invited me to the NVREA seminar, now business partner.

My experience is that these education programs will only take your focus away from pulling the trigger on REI. If you are serious about investing, all the education is there for free, and the biggest learning will be had on your 1st deal, and will continue with your subsequent deals.