All Forum Posts by: Account Closed

Johanna:  The lender is going to like your 100% equity.  But part of underwriting a loan is to look at income versus what the proposed payment will be.  We really don't have enough info here.  They're going to look at the rent, then they're going to compare it with the proposed mortgage debt (and any other debt that you have).  Finally, they're going to look at your credit.

If I were you I'd check with a good mortgage broker, see what options he has available.

@Gwen B.  In our case we tried to catch a raccoon and instead caught one of the neighborhood cats!  (He wasn't hurt, just trapped for a while).

When you do get a tenant, you might try to set your expiration date differently, so that it falls at a different time of the year.  Like a 10 month lease, or a 15 month lease.  Otherwise, your lease will always be expiring at this time of year.

My experience is that it's difficult at this time of the year.  In fact, it's enough difficult that we try to have our leases timed with spring or summer.  Sometimes you can't avoid it though.  Our experience has been that the tenant quality is lower, so make sure you screen carefully.

BTW, on the cats.  I've hire critter companies quite a few times to get rid of raccoons.  They're expensive, but they get the job done.  Sometimes they use a trap of the type you can get at Home Depot as you mentioned.  The problem is it's not easy to lure the right critter!

Just a quick comment:  it's easier to find the tenant than it is to find the property.  My guess is that even if you don't have this particular tenant, it would be easy enough to get one.  But I would echo Hattie's comments.  Alot of changes out there, some states have made some special rules that effect lease/options.  I have no idea though about Georgia.  Personally, if I were you, I wouldn't be rushing to get a property for this tenant.  He's replaceable.  I'd be carefully looking for a property that meets my requirements.  Rushing to find a place for this tenant is apt to make you too motivated, make a mistake.

Don't you just love it?  An app to make landlords toe the line.  Do they have an app to make tenants keep their place clean and pay their rent?  I'm guessing we have a whole lot more errant tenants than we have lax landlords.  But just a guess.

It's generally difficult to sell a house that is tenant occupied.  They may not clean the house, or cooperate in other ways with showing of the house.  And as you know, you'll have to give them notice to show.  The best way to sell is always going to be without the tenant.  And as already mentioned, buying out the tenant is one way to do that.  Otherwise, you're going to be stuck with selling to landlords who may want a tenant.  That becomes a much smaller market.  One other thing, I'd read your lease carefully.  Sometimes a lease will permit the landlord to cancel the lease on a 30 day notice.  The problem is I don't know if that would stand up in court given you signed a 2 year lease.

I do things differently.  First, I took a look at the tenantturner website.  Interesting, but not a direct I would personally go.  I think having direct contact with a potential tenant right from the start gives advantages.  In my ads, I always put that I respond quickly.  Do you know how many times you can call an ad and get no response at all?  I advertise on Craigslist.  I use alot of pictures.  For the last number of years I have not had any tenants that did not come from Craigslist.  My experience with email is that most of the time you don't hear back from them.  But in your case, you're asking for an application upfront.  I don't do that either.  And I suspect that has possibly become a barrier.  Personally I wouldn't want to fill out an application until I knew I wanted the property.  I encourage people to either call or TEXT.  Text is a big thing these days.  I love it, easy for people to contact you, a record of your conversation.  And during the phone call or text, I ask screening questions.  As far as rent goes, I have some properties that in some cases are much better than the market.  But I don't price them above my market.  I price them at the higher part of my market.  And trust me, I know the market in my area.  Why?  I call other rentals.  I drive by and look at them.  I've even walked thru a few times.  It's the only way you're truly going to understand your market.  I don't use trulia, or anyone else to tell me what my rent should be.  I determine this on my own.  I also don't charge any type of screening charge.  I simply absorb it as a cost of doing business.  I can do credit, nationwide eviction, and criminal search for around $25.  No application fee is something I sell as an advantage.  When you actually get them out to the house or apartment, you've got a better chance.

All too often we forget what this business is all about.  This is a PEOPLE BUSINESS.  We as landlords make a difference.  It's not just about houses, buildings, etc.  It's about people who need a place, sellers that need to sell and so forth.  It's all about the people.

When I'm buying a listed property, I generally go directly to the listing agent, I don't use a buyer's agent.  Since that is the case, I always try to get the listing agent to drop their commission since they will still only be representing one side...the seller.  Usually I do this in connection with an offer.  So I start by suggesting 3%.  It may end up that the listing agent refuses to lower at all.  Hey, nothing ventured nothing gained.  Sometimes they'll drop the commission modestly.  Alot is going to depend on just how good a deal it is.  For what it's worth, where I have seen bonuses used is a bonus paid by the listing agent to the buyer's agent.  A sort of incentive to show the property.

You know, I saw alot of my fellow real estate investors leave the market during the RE crash.  The thing is, most of us did not foresee the severity of what took place.  Buying right to begin with helps, but if your values drop 50% there's a good possibility that you didn't buy cheap enough.  Thinking about some of the things I saw then, I'd say leverage is a key factor in surviving bad times.  Usually everyone wants to leverage as much as possible because it amplifies your return in a good market.  So buying at discounts, using lower leverage will help.  When prices dropped I had very little leverage.  I lost some of my net worth.  But it was amazing how many of the landlords around me went out of business, lost their property.  Another thing that happened in my area was that rents were under pressure for a while.  Since my leverage was low, I was able to lower my rents slightly to keep my places full.  That becomes more difficult when you're highly leveraged.

I think you should be applauded for looking at your risks.  Just remember that if you don't see a risk, you just haven't thought about it enough.  That's not intended you scare you off, just to make the point that if you can determine all your risks on a particular deal, then you can determine if those are risks that you can live with, and maybe come up with Plans B and C if those problems occur.  One other thing, alot will depend on what type of investing you're doing.  A landlord takes different risks than a wholesaler or rehabber.

It really depends on what they knew or if they knew.  Either way, court is probably not the way to go.  Only the lawyers win.  You could discuss this with a real estate lawyer, see what he has to say.  Maybe he could send a letter to the listing agent and the seller, referring to lack of disclosure, talking about your expenses, etc.  Letters are generally cheap.  And maybe it would scare someone into paying you something.  But I wouldn't count on it, and I wouldn't go any further than writing a letter.