All Forum Posts by: John Clark

------------------------------------------
Your numbers are reversed. It's 1.27 agents per sale and .785 sales per agent.

"How much would it cost to separate the two floors to have their own gas and electric?"

---------------------------------------------------

Do you really, really, think that there would be a flat fee for such things, given the infinite variety of conditions a plumber or electrician could encounter?

Originally posted by @Matt Ternullo:

... interest rates in the 3's will save you a lot of money when interest rates get closer to 10% one day.

---------------------------------------------------------------
Prices may be sticky, but people get approved based on payment amounts, not prices. Ten percent interest means you can buy less house. High interest rates either reduce prices or reduce rates of appreciation. If prices are reduced, the buyer can lose money if he sells, or take a long time trapped in the house while waiting for prices to recover. If the house actually does cash flow, the buyer may make out alright, but there's still a lot that can "go wrong" for a buyer in real estate, even if he does buy at a good price. "Saving" money at a low interest rate vice a high one requires buying the same price of house, with just the interest rate being different. At that point (ten percent interest) I'd have to ask myself what alternative investments are there to the illiquid, non-appreciating, high-transaction-cost, political trap of an investment that constitutes residential housing.

Yes, long term held, cash flow positive, properties should be safe, but one can very easily, and very much, "go wrong."

Originally posted by @Axel Meierhoefer:

Any money you put in a bank account belongs to the bank and when you read the fine print of your account opening agreement, you are lending that money to the bank.

--------------------------------------------------------

If people worried about counter-party risk, Axel, no one would get out of bed in the morning. This is especially true when you figure that most people with bank deposits are with banks that are federally insured.

First find out if your alderman allows AirBnB and other short term rentals in the ward. Mine doesn't.

Some thoughts:

1. Status of plumbing -- is there a kitchen in the basement already? And a bathroom?

2. How high are the basement ceilings?

3. Does the basement have two separate entrances/exits? Or one to the outside and one to the first floor unit? If it's one to the outside and one to the first floor unit, then it's an in-law/family apartment, and will never rent for the full amount of rent you would get from stand-alone apartments: Would you pay full price for the privilege of giving a complete stranger 24/7 access to YOUR dwelling? And vice versa?

4. Washer/dryer locations -- one in each unit? Or does basement tenant put up with people traipsing in and out all whenever? This goes to rent levels.

5. Amount of reduction in 1st floor unit value due to it being smaller?

6. Separating gas and electric for 1st and 2nd floors should be reasonably inexpensive. I wouldn't bother with water separation, since people expect that to be included in the rent. Do make sure your water account is metered, not estimated, though.

7. Check your marketing. Large or extended families need duplexes. Why bother with getting two or three individual tenants when one large family with government support (Afghan translators fleeing Kabul, anyone?) would be great.

People forget how nice the South/Southwest side can be. Lots of overlooked opportunities. Just follow the Orange line L and check out the neighborhoods.

"The ONLY reason why our offer was accepted was because we were able to close quickly using the LOC. There is value in using equity this way. I'd consider that a reasonable strategy. Also, we are able to refinance before paying a cent of interest."

---------------------------------------------------------

I understand Joe V's posts and point of view, I just disagree with his philosophy of a high use of leverage. Here, however, Joe is right when he said that the property owns the equity, not you.  As for there being "value in using equity this way," do a thought experiment: What is the difference between you having $130k cash in the bank and no equity to put a line of credit against, and vice versa? Your refinancing would allow you to put the money back into the bank. No doubt Joe would say that you could assign your cash flow to the bank and borrow against that for those times when you needed to move fast.

On what grounds would you evict? I guaranty you that a judge would rule that you modified the lease by accepting split payments in cash/check/whatever, and the fact that she is proactively seeking help from various organizations will count in her favor, not yours. As others have mentioned, an eviction will set you back far more than round trip drives twice a month, AND I bet a judge would laugh you out of court.

Post-dated checks is one possibility, as has been mentioned. You might try contacting the "different organizations" and see if they can help her set up online payments. It sounds like you have a jewel -- if older -- of a tenant. Don't blow it.

If you do decide not to renew, give her P-L-E-N-T-Y of notice (far beyond what is legally required) of non-renewal, so she can smoothly move out.

"the title company didn't think an old man would lie so they gave him the title."
-------------------------------------------
As others have pointed out, title companies insure title, they don't hold title.

There are title company subsidiaries that hold title -- these are land trust companies. So Chicago Title Insurance Company issues title policies and insures title, and it owns a subsidiary -- Chicago Title Land Trust Company -- which can hold title to properties placed in its trusts. I say this because a layman can easily confuse the two and think  that the title company holds the title.

That, however, gives the original poster a possible way to check out the **** and bull story that nut job applicant is telling. Most county recorders offices are on line these days, and one can see the chain of title (if not the actual documents) on line. First question is: Was title to the property placed in a land trust? If not, then one simply tells the applicant that her story doesn't hold up: The title company, being an insurer, could not give title to anyone, and never would have done so in any event.

If the "old man" committed fraud then the nut job applicant should have filed a police report. and possibly complaints with the state's attorney and possibly other state agencies that deal with fraud. If the property was in fact held in a land trust, then the land trust company will certainly file criminal complaints against the alleged con man.

So the original poster can ask the nut job applicant for the criminal complaints.

As for the "legal team" -- talk to them and obtain case numbers for filed complaints (most county court systems areset up for on line case name searches, so one can type in her name and see if any cases are filed in her name), and any filed charges with state agencies that the "legal team" made.

And if it turns out that nut job applicant lied about any part of the story, disqualify her immediately and forevermore, documenting everything and saving your records.