All Forum Posts by: Karen O.

I touched base with an investment advisor at BOA/ML.

He said the inverted yield curve on the short term treasuries is a precursor but nothing to worry about.  

He said when the curve inverts on long term treasuries, then the clock is ticking and recession is likely to be 12-18 months away.  He says ML is looking at mid 2020.

During the next 18mo, he expects the market to continue to move up overall, but he'll be reducing client exposure to equities in anticipation of the downturn. He expects ppl to think he's nuts, but he'll be moving to the lower range equity exposure allowed by the IPS.

Two days ago, a guy asked for advice on helping his girlfriend possibly rent a condo to her sister's boyfriend's mother's niece.  Many of the posters suggested that it was a bad idea to rent to family and to family of friends.  It is a situation fraught with danger of causing rifts in friendships and creating stress in the family ties that bind.  

So, as you're on the other side of the coin in this scenario, I'd recommend you rent someplace else from someone else.  If this is the only and best option and you actually meet her qualifications of income and other factors: 

Negotiate the rent fairly.  Don't 'expect' her to give you a family discount.  Be grateful if she does. 

Insist on a properly executed lease as it spells out expectations

Pay your rent, in full, on time, every time.  No excuses.  Don't try to penny pinch.  The property is a business for her and the income generated may be needed for her to make ends meet.  

Don't be a nuisance tenant, do minor repairs yourself.  But let her know about big issues, like a leaking roof, bad water pressure or insect infestations like carpenter ants and don't attempt to fix without permission.  

Don't let new residents come stay without permission (pets, friends or AirBnB guests). 

If the owner has not indicated a plan to sell, then only mention once, after you've lived there a while, that you'd like to know if she ever decided to sell as you might be interested in buying.  

Maintain renter's insurance.

I'm sure there are other thoughts, but these come to mind first.  

I hope they're helpful.

Good luck. 

If you're an accredited investor, have you considered a Delaware Statutory Trust (DST) and an interest in a large syndication deal?

You don't say how long she's lived there.

Before deciding on the projects to take on now, I'd have a chat with her.  She may not welcome the disruption of new floors or walls to be cleaned.  Since the property passed inspection, I'd concentrate on what is absolutely necessary and save up for a future projects by beefing up the capex/reno budget when she vacates.

So sad

But you say these folks are moving from another state, have bad credit and can't afford a  deposit.  And need an aunt to co-sign.

This all means they can't afford the unit.

The monthly loss = $800/mo (2500-1700).  Your GF would be supplementing her sister's boyfriend's cousin to the tune of $9600/yr. What?

Wanting to be helpful is great.  Giving away almost 10k is excessive.  And what happens if her sis and Beau breakup? Or the boyfriend's mom doesn't come through when cousin decides to do Disney rather than pay rent?

This seems easy.

Don't rent to family and family of friends - who can't afford the unit starting out - unless you just want to give $ away, want to break the family ties or the friendships.

Good luck.

@David Van Horn

Excellent.  Good job.  And congratulations on completion of your first project.

Are you still in school?  You said your loan amount is going up annually.

Still, were it me, unless the house is appreciating greatly, I'd consider selling my interest in the SFH If the monthly take is equal or less than the loan payment.

From afar, leak and fence repairs sound like expenses and the roof and foundation work sound like capital items. But more info is needed and your accountant will be able to guide you.

Nice to have both.  Glad you're on the road to recovery.