All Forum Posts by: Kel S

If it were me, I would let them go but NOT give the deposit back until AFTER you do a walk through of the house.

However, that is me. If it were my husband he wouldn't budge and would insist they pay July rent. Or if he didn't do that he would take the rent out of the deposit and the remainder would be for cleaning cost if there were any. Depending on what the lease said and the law.

So as you can tell I'm not really cut out to be a landlord...at least on my own. I couldn't deal with tenant very well. Thus, the reason I'm in a partnership so to speak with my husband. He's an attorney and negotiates all the time and can handle people a lot better than myself. So I take care of making phone calls, setting up appointments, etc., and he will deal with direct tenant issues.

Representing yourself as the "Property Manager" is something I'm pondering. Because that may be a better way to go then opening telling people you own the house.

Eddie,

Sure. I'll ask him tonite to email it to me and I'll post it here.

The one (Fannie Mae) we are buying says we can't sell it for over a certain amount before 90 days. I wonder why they do that? This is what our addendum states:

Grantee herein shall be prohibited from conveying captioned property to a bonafide purchaser for value for a sales price of greater than $XX,000 for a period of 3 months from the date of this deed. Grantee shall also be prohibited from encumbering subject property with a security interest in the principal amount of greater than $XX,000 for a period of 3 months from the date of this deed. This restriction shall run with the land and are not personal to the grantee. This restriction shall terminate immediately upon conveyance at any foreclosure sale related to a mortgage or deed of trust.

Originally posted by Mr_Investor:

You haven't been on coasters until you been to Cedar Point.

OH MY GOSH YES!! Cedar Points coasters are those of legends I swear. There are a couple you couldn't pay me enough to go on like the Dragster. We live about an hour and half from there and go every year. One year I even went parasailing. Talk about an amazing experience...to be 300 feet above the lake and park and see forever. I can't wait to go this year! Only a week and half until we are there.

Hi Scott,

Yeah, I was shocked. Hubby is an attorney so you can imagine how "wordy" that letter was LOL! But it worked and I'm pretty tickled to see the taxes reduced.

Eddie,

Thanks for the insight. Makes sense.

We recently wrote a letter to the Tax Auditors office to request a re-assessment of the tax value on one of our properties. This would be the taxable value of the home. For an hour of our time in writing the letter, we recently heard back and they reduced it by $30,000. Previously it had a tax value of $83,500 and they reduced it to $53,500. This is great for us. But not sure how that may effect the home value going forward. I heard that the tax value and home value are separate? We paid $31k for the home, so the tax value is still higher than we paid. Anyway, I was glad to see that we got it reduced. It helps the property to cash flow better too :mrgreen:

Originally posted by nationwidepi:

While owning free and clear offers safetly in not having a mortgage payment, you have a lot of cash tied up in the walls which only produce the cash flow return and expose you to lawsuits due to your equity position.

Nationwide, I have a question about this. When you say it exposes you to lawsuits due to your equity position, would that hold true if the properties are owned by a LLC? Would having an LLC offer some protection from such lawsuits?

To the original poster here are my thoughts:

While we are new to RE investing, we are doing things a little different in that we are going the buy with cash route. At least for the first couple purchases. Our goals though are to not have mortgages. Perhaps it's simple out of fear of having to rely more on the tenants to make the payments. It would be a really bad situation if say for example my husband lost his job and we had rental mortgages and vacancies. That risk just didn't sit well with us.

Another reason is we just prefer to be debt free. Or at least close to it. Right now we are working on paying off my husband's law degree student loan and after that we will only have our own house mortgage to pay each month. We both own used cars so no car payments at the moment either.

Based on everyone's advice so far we might be doing things a bit backwards. And at some point (which we are getting close to now), we will run out of funds to buy cash REO's and will have to replenish that. But it's just such a better feeling knowing we don't have to rely on someone else making the mortgage. Just have to worry about making sure the taxes/ins is paid if we had a vacancy for a short period of time.

The other thing is our long-term goal is such that we would like to have our return paid back to us on these investments in 15 years. At which point we hope to retire. These rentals will hopefully provide us with additional retirement income.

That was going to be my next question too...if anyone knows where to get a good lease-option contract. Or is this something an attorney should draw up?

Originally posted by Jon Klaus:

With the option payment being non-refundable, can't they argue for equitable interest if things go south? How do you handle that?

Good question as I am curious about that too and how that's handled.

We are putting in a lower offer on a house we've had our eye on and if we get it we'll need to redo the kitchen. Which has been gutted (no cabinets, counters, sinks, appliances, etc.,) So my question is, there is a place where it looked like it had a built in dishwasher. Being this will be a rental would you put another dishwasher in?

I've always heard the more appliances, the more future maintenance which makes sense. However, if we don't put in the dishwasher, will that turn people off from renting the place?

I know personally, I'm spoiled having a DW. I'd hate to have to go back to doing them by hand....did I just answer my own question? LOL!