All Forum Posts by: Kuriakos Mellos

Brock!  A few things:

A) I would never shop around for mortgage rates, the first few properties I just 'felt' that my mortgage contact had the best rate for me and never shopped around.  That was a mistake and has cost me I am sure a ton of money.  I always shop around on the onset and have mortgage companies really do their due diligence.  I am down to two contacts now that I use (or have used) for purchases and refinances - and feel like they truly have the best interest out for me.

B) Contractor Drama:  I swear books should be written on contractors.  It is very hard to build up a reliable set up of contractors/handy men/lawn people and so on. The first thing is: once you find people that are reliable and have good communication, pay them promptly and be respectful to them.   As your business grows and you use them more and more, you will see that they will respond to you faster, and work more efficiently for you and ALWAYS treat them with kindness. For larger projects (any remodels and so on) get a detailed scope of work: set timelines: and NEVER pay up front.  Always ask for receipts as well and keep tabs on progress.  My first rehab that was suppsoed to be a ten day project ended up being a 8 week drama filled adventure - with the contrator sneaking in at like 6 AM to begin work (because he was doing several jobs at once) finishing stuff mid way and then disspearing for a few days again. 

C) RESERVES:  NO matter how strong cash flow is, how solid your tenant history has been, how new your property is - things ALWAYS break down. I know many people talk about the path to financial freedom away from work via real estate (which is the dream!) but it is almost better to have a solid w2 job if you could while you are beginning because you never know what could happen. People get greedy - and expand fast - and don't prepare for a broken water heater, a vacany and an AC unit going out in the same week.  A big hit like that can really put you back if you can't take the blow.  Keep saving, even when you think your reserves are in a decent spot because one or two big things going down can put a dent in your trajectory forward.  I had a rehab project that ended up being an absolute disaster and went over budget (electrical wiring had to be rerun, washing machine broke the first day the tenant moved in, water heater broke the next day meanwhile I had to replace a dryer at another property).  Reserves and savings helped me ride that out.

Hope this helps!

@Brendan Terranova I have 3 properties in the area. The first was my former primary (duplex) in the Saint Francis area.  Feel free to hit me up. There are some good people in town to connect with!

Prajita - depending on credit score, DTI and some other factors you might be able to get investment homes with 15% down. (Yes there is a PMI but you would be surprised how quickly that falls off.). I am a HUGE advocate of moving every year into a new primary and converting my previous home into a rental as well.

@Blake B. thanks for the note: I was flying when my team was calling the bank. They never confirmed there was any money in the account, rather they identfiied it and closed it. Everytime I've called they obviously blocked me from learning more. I think my agent said you can do something called an injunction to do more digging?  (Again not a lawyer here ;-)

Hey everyone,

So now that some time has passed, and I got that rental up to par (and the slap across my face has healed ); I am ready to get some help in trying to see if can try  and get some of my money back that we believe WellsFargo might still have. 

I had a hacker get into my real estate agent's account and posed as my title company last year in which, I dumbly, wired money too.  My first heads up should of been that the first wire bounced back, but went ahead and sent another one.  By the time the real title company has alerted me that they had not got the funs, I was about to take off for a trip (literally on the plane)  At the time, my agent was able to call the bank (WellsFargo) and alert them of the fradulent account of which they then found and closed.  Since then both my outgoing bank (which I used to initiate the transfer and tried to do a recall) and WellsFargo - the receiving bank - have been sort of a dead end.  WellsFargo refuses to talk to me as they are saying they are 'protecting' their customer - even though we identified it as fradulent.

Not sure if there are any lawyers out there who can help me guide thru the process, but if I could get any money back that would be great. Luckily it wasn't a crazy amount but served as a wake up call.  I am what I would say a pretty seasoned investor and had this slip thru and happen.  Ready to move on!

Thanks !

K-Man

Oh the classic house hack! Well that is good because you can get to meet them and vent them out ;-)

Hey @Nicholas D'Andrea!  

I am a HUGE advocate of FF and have rented now I think 5 of my units to nurses and other travel professionals.  The rent by the room strategy is great and lucrative but can be hard to find people willing to do it.

I have run rent by the room rentals at the bottom of a duplex 2/1 and a small single family home 2/1.  In all the cases they did not know each other prior to moving in together, but turned out to work just fine. I was charging up to $1600 PER room. (Insane) as I know that the demand was high, and the hospitals paid pretty awesome per diems for housing:

Some things you should do on the onset:

Make it clear in your listing that there is the option to rent by room.  Most people want their own spaces, but I feel like younger people; especially women, like knowing someone else is home and offers a bit of safety. It is also a social experience for them.

Things to do:

- Have them talk to each other prior to committing: (this is not always possible but I have done it at every turnover and it has worked out great).  - Make sure they understand each others schedules, what are their hobbies, do they like pets, two of my nurses ended up becoming great friends and now travel together on assisgnments

Some pros you have going on!

You have 2.5 bathrooms,  the fact that hypothetically everyone could at least have a semi private area is awesome.  How is the living area?  I would also divide up kitchen space (cupboards) for each individual tenant.

The Cons (potentially)

Roommate conflict. I have not had this happen but heard from another investor of cases where one of the tenants was a late night partier and would disturb their sleep.

Managing several leases for one house at one time can be annoying and cumbersome.

Other ideas:

If you have such a large home have you thought of maybe running an add at the same time advertising just the big house? You would be surprised of some hits that happen. Insurance claims like big homes and there might be one off cases where you could make almost as much by renting by room to one family or group of people.

Hope this helps!

K-Man

Same as above but really like the format of Zillow Rental.  It helps post to a few more sits (HotPads and others I believe) and their format for communicating and getting some upfront relevant information is great.  I have landed most of my tenants on there and they have been awesome. (I do have credit score and income verification requirements as well) but it helps push out some of the dead weight that comes in.  Facebook is so and so, I've landed one solid tenant from there but you also get absolutely bombarded by people that just want to click on anything new and shiney. 

Hey there! A fellow Milwaukee area investor myself:

The above a great list. I have found myself going back and referencing this book a lot:

The 12 Week YearBook by Brian P. Moran and Michael Lennington

It is more a mindset motivator for me, but it helps tie my long term visions that I want to get out of realestate and keeps me constantly pushing forward and smarter.

Hey Noran - Condos if newer construction with all the amenities, might be a decent first option but I personally have seen all the negatives of a condo building and HOA's associated with them. There are usually restrictions on what you can do with your unit, and have found it counter productive. Not to mention: politics, very anti investor friendly owners in buildings, special assessments, lack of pride in surrounding units and aesthetics, and so on. I currently have the treasurer of the board, who lives under neath one of my rentals, and will text me at 10:01 PM if he feels the TV is too loud from my tenant. It's utterly annoying. You also do not get as much appreciation as you would with other properties. The only positive is that HOA's generally cover larger expenses...that is UNTIl a special assessment is added. My friendly advice - avoid if you could ;-)