All Forum Posts by: Mario Morales
Mario Morales has started 85 posts and replied 227 times.
Post: Renters Insurance-Impact On Insurance Premiums

- Posts 232
- Votes 101
My insurance just went up by 2K, since my tenants in my "C" class building dont have renters insurance. I got my renewal this month and I renewed my leases this past April. I am thinking next year do I raise accordingly or require them to have renters insurance and hopefully save 2k or whatever the difference may be, thoughts?
Post: How do rich pay zero taxes legally?

- Posts 232
- Votes 101
@Terrell Garren I have always heard what you said, but my question is if I paid zero taxes because of my deductions in real estate, will that make my schedule E look unprofitable to an underwriter when looking for a loan for my next property?
Post: How big a factor is crime rate when getting a rental property?

- Posts 232
- Votes 101
There are risks, as everyone has mentioned. I have investments from low to high crime areas. 99% of my late rental payments come from the high crime areas. I house hacked and then moved out, it was a sacrifice as I didn't go out at night and when I parked my car I made sure to look both ways BEFORE getting out of my car to get to the door. With that experience I learned a few things, cashflow maybe better (theoretically ) but evictions are higher (had 2 of them) and lastly as I invest now, any deals that I look at... and yes I may lose out on some opportunities, I have to be comfortable going to that neighborhood to deal with whatever may be needed. If I invest in high crime areas, I will use a property management company. A lot of smarter people than me are able to do it, but I don't want to do it again, I prefer the "B" class areas.
Post: DSCR Home loans

- Posts 232
- Votes 101
My 2 cents, I was surprised to learn on a DSCR loan I was looking into, there was a prepayment penalty, as I was hoping to cashout refi when the rateds dropped...at some point :(
Quote from @John Warren:
@Mario Morales having an organization pay rent is no different than having the tenant pay it. The organization may want you to fill something out, but your accountant can advise you on this for sure. I would take the money in a second.
Thanks John, will do!
Quote from @Michael Plaks:
This is the same as any other rent income. No need to contact your tenant.
It is wise to request that the organization will report it on Form 1099-MISC as "rent" and not on 1099-NEC as "non-employee compensation" - which is a very common error. They can still mess it up, but asking won't hurt.
Thank you so much!
Hi, my tenant for this month only, will have an organization pay his rent, 1200. I was sent a W-9 form, will I pay 28 % in taxes and should I make my tenant aware of that or will this be the same as receiving rent and paying taxes on it at the end of the year.
Thank
Post: How did you first get into the real estate game?

- Posts 232
- Votes 101
I saw a 3 flat next to the train station and said "if this unit brings in 1100, the 2nd unit $800, and the 3rd unit $400, I should make some money here". I had no idea bigger pockets existed, just a very, not recommended, way of analyzing this deal. Units 2 & 3 couldn't pay rent, so I nearly evicted 1 and unit #3 just left, I was in the negative, 100 a month. I fixed up the other unit with the bare minimum and house hacked. Started to cash flow. Got my realtors license to understand the business a little better. This building allowed for buildings 2 and 3.
I shot 1st and aimed 2nd. I got lucky and maybe the hard work that I put into it paid off, not sure.
Post: Paid Laundry for 5 tenants in single unit?

- Posts 232
- Votes 101
Quote from @Cassandra Vickers:
@Mario Morales
It’s a 2-family property. I live in one unit and the other has the 5 tenants. There’s no place to have a common laundry, so my only option is in unit. How many people are using your washer to make $150/month?!
Its 3 families with a total of 11 people. I do the dryer for free but when that craps out, I'll get a coin operated dryer and add to the revenue.
Quote from @Jonathan Klemm:
Hey @Max Traveler - That sounds like you have a solid plan in place my friend. I'd be questioning whether taking out the chimney is worth it, I totally agree it's a pain and probably not in an ideal place, but it's going to be expensive and I honestly do not believe you'll see the ROI for that repair. We've done many tankless hot water heaters in tight spots and they work great.
Being in the top 10% or so of the Chicago rental market is always our game plan, I've found that good products rented or solid always move quickly and time ends up being the biggest saver or loser from my experience.
Hi Jonathan, I like your idea on the tankless water heaters, what is better overall for a tight spot, I have a small utility closet where I have a 40 gl water heater, which will need to be replaced at some point. I think I should get rid of it and install a tankless to give tenants more storage room.