All Forum Posts by: Lindsey Matejak

Hey BP! I just refinanced my primary residence to a 30yr conventional fixed rate loan. Our building is a 3-unit in Chicago--my wife and I live in one unit and rent out the other two units. We would like to buy a new multi-unit and move into one of the units of the new property while we rent out the other units in the new building. We want to keep or current building as a fully rental property.

1) How long are we required to stay in our current multi-unit after refinancing? 1 year? Any way around this?

2) We want to put down the least possible amount on the next property as long as the numbers work for cash flow. We've already explored the FHA route, but with the restrictions in place, we have found that this is impossible for us to do in Chicago (i.e. per the lender: must be 100+ miles from our current property, FYI loan limits, they won't take into consideration the potential income for the unit we are currently living in to calculate debt to income ratio which is about $3000+ per month, etc). We are being told that 20-25% is are only option if we want to buy another multi-unit in Chicago. Anyone have alternative information or ideas for less down payment?

Thanks in advance for your assistance!

Hello,

I recently had a major plumbing project done on my multi-unit building. I signed a contract at the beginning with a GC that was more general than I wanted considering the large price tag, but he kept saying that he couldn't make it more specific until they busted up the concrete to see what was really going on (lots of unknowns due to age and character of building). No need to highlight that I never should have signed--I am aware and there is a HUGE back story as to why I did that is not significant to the question at hand.

Due to frequent flooding, we were planning to have an overhead sewer line installed, as well as a sump pit for the basement plumbing, an ejector pit for the upstairs/exterior water that was leading to the flooding, and tying in the downspouts to the mainline at the front exterior of the house underground.

The project, which was estimated to last about 15-20 days, took more like 10-11 full days. Along the way the GC and subcontracted plumber mentioned numerous times that they found great news or thought of more efficient solutions (i.e. the mainline plumbing under the basement was intact--that they had assumed was all broken and needed replacing). In the end, due to the "great news" they found, they ended up not installing an overhead sewer line or digging out front to attach the downspouts to the mainline in front of our house, but instead, redirected some of the existing piping and doing an edited version of the proposed plan that more heavily used the intact mainline under the house.

The end result has seemed to be a resolution to the problem (so the ultimate purpose of the work was achieved), but with what I would estimate to be about 50-70% of the total proposed work. We are now in debates with the GC that he should update his pricing based on how much the scope of work changed. If you read the signed contract there are a number of elements that no longer apply and that they did not do (because it was unneeded). We have payed 80%+ of the balance, but he is fighting that we need to pay the full initial rate that we signed on even though the details of the contract are inaccurate and he never sent any written Addendum to the contract for changes in work (he just went ahead and made the executive decision about adjustments without checking with us first). He is now threatening a lien if we do not make the final/full payment.

What are my rights? Are we locked into paying the initial contracted amount since we signed the document? Is he able to put a lien on our property without having to justify his claim? Advice on how to respond?

@Brie Schmidt, @Chris Titcomb, @Thomas S. -- thank you all for your input. This is very helpful in making a decision about selling vs. renting.

I own a unit in a small condo-only building in Chicago. I am interested in moving out and renting out the unit for extra income. Currently, our building has no rental restrictions in the governing documents but all 4 units are owner occupied. Out of courtesy, I informed my neighbors of my plans and am receiving pushback from some of them. They say it'll be a hassle and devalue their homes. As I mentioned, the condo association docs don't prohibit it, but they still may try to block it and get lawyers involved. I’m wondering... (1) If the association decides to implement a no renters policy and I already have the tenants in the unit, am I protected under a ‘grandfather’ situation, or could they force my tenants out? Or not let me rent again if there is a turnover of tenants? (2) I start renting my unit - does it hurt the others' resale value since the building is not 100% owner occupied anymore? (3) The association changes the bylaws to say no renters - does this hurt the resale value bc some portion of the market doesn't want to buy? Appreciate any input that can be provided!

@Natalie Kolodij my apologies for not replying previously! Thank you for the information. It’s been very helpful!

@Corey D. McCray I would appreciate that information, as well. Thank you!

Hello BPers! My wife and I just purchased our first property using a personal loan. It is 3 units and will be owner occupied. We did the research about LLC vs Umbrella Policy and ultimately decided on a $2mill umbrella rather than the LLC for this particular property. This post is not about people's opinions about LLC vs umbrella.

Our intentions were to move into one unit and update the interior (paint, redo hardwood floors, replace carpet, replace light fixtures, renovate bathrooms and kitchen) while we were living in the unit. Once complete, we would move to the next unit and do the same thing on that unit and again on the third unit. Once renovations are complete on the property we would move out and hope to do the same on a new property.

We recently spoke to a CPA who said that if we did this, the renovations/repairs we do while we live in a unit will not be tax deductible on our Schedule E during tax filing. Could anyone provide more insight into this? Yes, we will be living there, but not for long after the renovations are complete (maybe a year or so total in each unit, updating one area at a time). Is there a length of time prior to moving out & renting the unit that we should keep renovations within so we can argue that the upgrades were for rental purposes rather than personal in the case of an audit? 

Thanks so much for any advice you can offer!

@Allen Chaney - got it--thank you!

Hello,

I signed up for pro and have been running rental property analysis reports, but I cannot figure out where on the website to find the historical library of the properties I've run. Could someone point me in the right direction?

Thank you!

Blair