All Forum Posts by: Marc M.

@Mario F., like others have said...I would definitely not close without a contingency that the unit is to be delivered vacant. I am actually on the other side of things as a tenant in a rent-controlled apartment in Santa Monica (though my rent is closer to market-rate than $350!), but there is very little a landlord can do to get someone out of a rent controlled lease if they are paying their rent on time and are not in violation of the rental agreement. Like @Dale Shin mentioned, if you or a family member are planning to occupy one of the units you can get her out. Otherwise you have to compensate her with relocation money....Santa Monica has a chart on their rent control website, and I'd imagine LA does too. For frame of reference, Santa Monica requires $13K for permanent relocation assistance. For a low-income senior, it will certainly be higher. Good luck! And let us know how it turns out...

-marc

Hello BP,

Are there any investors out there who have had success buying HOA liens at weekly sheriff's sales? I follow public notices in my home state of Michigan to track foreclosures in areas I invest in and sometimes I see HOA's foreclosing for under $10K. I assume that 99% of the time there are senior lien holders like 1st or 2nd mortgages ahead of the HOA, but I also wonder if any investors use this as a strategy....buying a cheap lien to then take out the seniors if there is equity in the property? Said differently, if you buy a $3000 lien can you pay off the other lien holders so that you're in first position or is that essentially paying off someone's mortgage to get back your $3000? And if that's the case...what benefit is there to buying an HOA lien if any?

Thanks,

Marc

@Dom K. I used Findling Law to do my quiet titles. They charge $1500 flat fee. I've had situations where I had a pair of vacant lots side by side that they did for $1000 each as a discount (but that was mainly because the lots were owned together in the title chain, but were technically separate parcels). I've been very happy with their services.

Greetings BP,

I purchased a tax foreclosed property in Detroit and let the previous owner stay in the property for 10 months to 'house sit' while I was busy with other projects. We have a good rapport, and she will be moving out next month. My plan is to sell the property this summer. Here's the question: should I try to get her to quitclaim any interest she has in the property to me instead of quieting the title (even though I currently hold title via quitclaim deed from the county)? And if so, is it worth incentivizing her to do a quitclaim to the tune of $500? Or, is it unlikely that I would need to quiet the title given that she is the previous owner and I know for a fact that she received all the foreclosure notices?

I recently had two other properties that a title company wouldn't insure (and it sounds like very few title companies are insuring anything that Wayne County foreclosed last year given many legal complaints against the county). For those two particular properties I had to clean up both titles, which cost me $1000 each as a package deal. 

@Johny Kuppama, Kingdom Trust will still want to see an operating agreement for your LLC. You could easily file the articles of organization for an LLC in your state and get an EIN from the IRS but unless you're an attorney, drafting your own operating agreement that will float is more difficult. I'd imagine there are attorneys out there who could provide you with an off-the-shelf agreement for an SDIRA but after a few hours of fee you're close to $1500 anyway. I wouldn't be deterred by the upfront cost...think of it as a one-time insurance policy.

Thank you for the comments! @Sidel Murray, you have confirmed what I'm worried about most...major damage to the property out of spite. I take both your point and @Jon W.'s about eviction as the option of last resort. I'll try reaching out again to work out another deal. Honestly, my initial interactions with the occupant were great and I was really surprised that she stopped communicating. I have several other tax auction properties with previous occupants who are in worse financial shape, and they have been fine to work with. I'll keep you posted on how it works out. 

Best,

Marc

Hello BP,

This question may only make sense for Detroit landlords...in other markets it will sound idiotic. I have an occupied property I bought in the tax auction. I had initially worked out a deal with the previous owner to do a cash-for-keys arrangement where she would pay $200 / mo. and I would reimburse her the funds at an agreed upon move out date so long as the water bill current. I wrote a lease spelling it out, and she made one attempt to pay on through eRentPayment and her debit card was denied, and I never heard from her again. She is still living in the property, and I am fine to let her stay a two more months until I have time to deal with the renovation of the property because she is effectively a house-sitter, but as of now she is unresponsive to email and text message (I live out of town). I started the eviction process by sending a 7-day notice, but now I'm wondering what the best strategy is....should I follow through with the eviction and get a the judgement as a bargaining chip to work out a new cash-for-keys arrangement.... and is it possible to still exercise the judgement if she breaches that new contractual agreement? I'd rather avoid getting the mandatory bailiff and dumpster, and would prefer to use the cash I'd spend on setting someone out to find an arrangement for a cash-for-keys deal that would actually work instead. What's my best move here?

Best,

marc

@Scott Szurek, I have two rentals in Ann Arbor. Where is your property located?  PM me...

Best,

Marc

@Benjamin Blackburn, good luck trying to get someone on the phone at the treasurer! Three years of delinquent taxes is all it takes to foreclose (and I think two years if the property already went through tax auction once before...) If you're seeing properties with huge tax bills from more than three years past due, it's more likely the person is on a payment plan with the county.

@Chris England, one thing to consider with duplex vs. single family is that the city will not let you put the water bill in the name of the tenant on a multi-family (even if there are two separate meters). Detroit water bills are tied to the property regardless, but you can have the tenants of a SFH fill out an affidavit form at the Water Dept. that puts it in their name.....but of course if they skip out on payment....the bill is still stuck with the property. I'd be curious to hear how @Jeff Rabinowitz or @Saul L. deals with the water issue on their properties...Is it written in the lease that an unpaid water bill is grounds for termination?