All Forum Posts by: Rene Hosman

 Congrats on finding a deal and being able to structure seller financing. Do you know the terms - interest rate, years, does this amortize over the life of the loan, does it have a balloon payment?

I know @Crystal Smith has experience with seller finance deals and may have some more insight or recommendations for you!

Beyond this I echo what @Mike Grudzien said about getting an attorney. I would also recommend ensuring you have a title company do thorough title due diligence and get title insurance. 

Personally I backed out of a seller finance deal earlier this year because I wouldn't have been able to obtain title insurance and that was too risky for me. Unfortunately having title issues is one of the reasons that sellers are sometimes willing to do seller financing simply because they know mortgage companies won't approve without proper title work and title insurance so they have to be more creative in the ways they sell but that can be risky for you as a buyer.

If you do seller finance I recommend having very specific terms on HOW payments will be made and accepted and using a professional service like https://www.agecroftcapital.com/ for loan management in the case of any disputes - just my personal rec, not sponsored by BP though I do work for BP :)

Today, @Noah Bacon published an interested article to the blog that got me thinking - large apartment buildings often offer concessions - like first month reduced rent, or sometimes even referral programs. But it's not something I've considered as I personally manage my own small rental portfolio. In his article, Noah discusses why he thinks mom-and-pop or private landlords should NOT offer concessions and I want to hear your opinions! Have you ever offered them to entice renters? If so how did it turn out and how did you decide what to offer? Taking it one step further - have you ever been open to negotiating with prospective tenants or tenants who want to renew? ''

Check out Noah's article and his reasons why he thinks rent offers and concessions are not a good tool for private landlords here 

@Aaron Lynn Brown Wow great photos, love the beam accent you made! It tends to go one of two ways so.... After the first flip did you decide you're addicted and want to do more - or that you never want to do it again? 

 I always hear people saying how crazy property taxes are in TX but that's not so bad to me! Especially with the cash flow you're getting, great job on this deal, what a winner!

 That's a great return on all fronts! I always hear that property taxes in TX are killer, but if it's a condo does that make them not as insane? I have a place in Denver CO and my property taxes are around $1200 per year for about 900sq/ft

Wow sounds like you put a TON of work into this! Do you have more photos you can share @Aaron Lynn Brown ? Would love to see!

It makes sense they do that for safety reasons but how frustrating for you! 

The system in my multifamily building is that we have individual fire alarms in bedrooms and kitchens of each unit - those alarms are not wired to the central system. Then there is a central system that is outside of the doors on the ceiling if one of those in the common area goes off then it sets off the alarm for the whole building. This is to keep everyone's alarm from going off anytime one person burns toast. That is acceptable by our fire dept in Denver that inspects it once a year. 

Does your system allow you to pinpoint what alarm was set off first? Personally as part of my lease for condos I state that any HOA fee incurred due to a tenant's actions or neglect will be passed on to them and due to me within 30 days. I also have a specific note that they have to initial that if they lose mailbox keys that it is $400 to replace since it's a huge hassle to deal with the HOA when that happens. Haven't had to exercise this quite yet but I'm wondering if you can have the same kind of stipulation where you're allowed to pass along costs directly associated with your tenants setting off the alarm if it's the same person repeatedly?

Or perhaps it's a stipulation that anyone who sets off the fire alarm for the building if it's a non-emergency, regardless of you getting charged, gets charged?

Great question, I wish I had an answer but I don't know of any. Maybe someone here can point us to one and prove that print media isn't dead :)

Wow $750/mo cashflow for a property that was only $118k that's incredible! What year did you purchase this property?

Hi @Ricardo Lemus ! 

This is a great topic of discussion and ultimately I think depends on your goals and what metrics you personally try to maximize. 

The first question is of course, can you get a loan with less than 20% down - but I'll assume you can given that you're exploring both options.

I recently read Real Estate by the Numbers by J Scott & Dave Meyer (shameless plug it's available through the BP bookstore here) and in chapter 36 they discuss exactly this - that in some cases using more leverage can actually boost your returns and you should run the numbers both ways to see what makes sense for you. The TLDR is that if you can take the money you would have otherwise put in the property and invest it somewhere with higher returns then you could be better off doing it that way even if it means smaller or no monthly cashflow because money in your hand now is more valuable than the same money in the future. But that does not come without risk of course. And that is assuming that you can rent your property and at least break even even without a 20% downpayment - assuming it's a rental that you're talking about.