All Forum Posts by: Linda S.

Yes, I'd tell all 4 of them to apply and pay the fee for the background/credit check.  The 3 that don't get it,  unfortunately, they're out of luck and $40.   I only let people apply if they could get it, I wouldn't lead anyone on or have them waste money unless they were a strong prospect.    Believe it or not, most people weed themselves out when you state all your requirements.    

They pay Cozy.co directly,  we don't deal with any cash.    Feel free to ask questions, we've all been there!

@Jeff Bisgier, the tenant absolutely pays for the background and credit check.   It weeds out serious vs. non-serious potential tenants and is a great way to determine if someone is legitimately interested or not...      With Cozy.co, it's $25 for a background, and $40 for a background and credit check.   It's 100% worth it!    

Hi Jeff,

Congratulations on your big purchase!   First, remember to breathe... I was in a very similar situation, where we bid on an auction, thinking it was crazy low, no chance they'd take it.. they took it!... I kept thinking this is either crazy, or crazy awesome!    You have TIME, as much as you need, if it takes 3 months, or 6 months.. you just saved yourself 40K by paying cash! 

If you're worried about getting the cash back, depending on how much renovation needs to be done, you could go ahead and start the loan with the bank.. when we did our equity loan, the appraiser essentially just told us that comps are the biggest factor, and it's more of a check the box "does it have a bathroom, how many rooms,etc" instead of a thorough analysis of the renovations.    So if you are uncomfortable, I'd say get it started now.

I agree with everyone else here, your general contractor should tell you what HAS to be fixed, and what you might have a few more years on, and what's just cosmetic.    

We do all our screenings through Cozy.Co, they do a full background check and credit check, and then you just get a nice little PDF review of the person.. in addition to the basics (3-5x income/rent, no felonies, no evictions,etc) .. you have a few months until you can even start showing the place, so don't worry about landlording stuff yet.    Good luck!  Just take it 1 step at a time, sounds like you got a great deal! 

@Pino Alu, an important thing to remember-- *YOU* decide on your tenant.  YOU are deciding what income/rent to use, YOU decide who you rent to... There are a lot of good people that need or simply prefer a lower income housing, just because it frees up cash flow.    We have tenants on social security/disability, and they are great!  Others.. honestly most just need to be taught, but are catching on and just need to learn the process, and we're making extra in late fees..    I agree with @ @Jacob Pereira,   you can make a lot of money going to places other are afraid to touch.   Don't forget the human element too, everyone--regardless of income, wants a nice place to live.   Don't be a slumlord, slumlords are ones with trashed places because the tenants don't give a crap b/c the owner doesn't, it goes full circle.    IMO Risk will always follow reward... but again, just know what you're getting into... If you're buying house around $20K, you are buying the land, and you should fully expect to replace nearly everything, the market isn't stupid.. it's expensive, but if you have the determination, and the ability.. you can do it! 

If you do section 8, it's a whole new ball game IMO from low income.   I have a neighbor of our duplex, who is on section 8, who has essentially bragged to us about "not paying rent until the door screen on the storm door gets fixed"... stuff like that. .. it's a different mentality .. I agree with @Thomas S., the profit is there, but it comes with the stress.  I tell everyone that what I get in rent, I pay in stress!    

Hi Scott,

Congrats on your first duplex!  

1)  Value of Upgrades-- this all depends on the area, if other comps have it, and what type of tenant you're looking for?   I would never recommend granite,  the laminate now looks identical and gets lots of great feedback!    I agree with others, you definitely need new paint, flooring, and depending on the kitchen, I'd paint the cabinets and put in new knobs.

1b-  I think you need to know your area, and the type of renters there..  what is your strategy?   What type do you want, and do they exist in the area? Location, location, location!  You really need to know your area, and if the market is demanding it, or saying you can get by with less.    Look at comps!  Remember- it's a rental, not a flip.    

2)  I use Cozy.co to do all the rent, it keeps track of everything!

The crime data should be stored with the city or county.. try contacting the local police department and ask them for the data is it's not easily accessible online.   

Dealing with low income properties can be done, but it does take more work, more stress and likely more money to get the properties up to code.      I can't stress enough that you HAVE to know the area, where the crime is,  and also you need to determine if it's a good fit for you, and your stress level.

I think you definitely can, but it has to be an educated decision.   Check all the crime in the area, figure out where the obvious really bad parts are, and avoid like crazy!   Crime tends to be in pockets, essentially around the dealers.. drive by late at night, ask neighbors, etc..   You have to know the area, and make sure you're confident the area is hit or around rock bottom pricing, and there are jobs in the area.

Also @Aaron Hoye, props to you for realizing the real value of a mentor!   Mentors are crucial to success, and can help hold your hand emotionally, guide you the right path financially  and help you from making other mistakes.    Mentors are GREAT!!!!  Also, once  someone becomes successful, most people feel the desire to pass the favor on, so don't be afraid to ask for help!  

  Good luck!  

If I were in your shoes, I'd keep it and rent it, at a minimum you can get $700/month, likely more because you have nicer appliances and it's renovated.     While it'd be a great feeling,  to instantly be debt free, wouldn't it be a better feeling, to use all the rental income, and be debt free in under 5 years, and an additional $700/month, and have an asset worth $65K?