All Forum Posts by: Mark F.

I usually roll my eyes at preachy posts but this is pretty good. Unfortunately most newbies will still be attracted to low priced neighborhoods like you said. David Greene does seem to be telling people on the BP podcast to not invest in C or D neighborhoods unless you grew up there. Seems like most who are successful with that technique did grow up in the hood.

Still best to listen to podcast, go to meetups, check out books from the library you mentioned and house hack in their back yard, even if its pricey. It's RE investing with training wheels. About to close on my 3rd HH which will put me at $2.4 mil in RE holdings in 4 years.

Quote from @Andy S.:

Quote from @Russell Brazil:

Quote from @Mark F.:

In NJ, 1.5x security deposit is legal and standard. You need to charge more rent, like $100 more and do 6 months inspections. Assuming you know about the ESA before the lease is signed, tack on another $100 to the rent. It's not pet rent, it's the rent you charge. Six month inspections are critical of any rental, but especially with animals. You catch problems early and can charge back repairs. Almost all issues I've seen from tenants can be fixed with periodic inspections, which most self managed landlords don't do.

 Raising the rent because of an ESA is illegal. So op, do not follow this advice, its a $23k fine 

 Is it possible to raise rent without mentioning this is for ESA? I have not signed the lease with the tenant yet, this is before even onboarding him as my tenant

 Russell's correct and I'm wrong. Even if you know beforehand. If I were you, I'd be diligent about the inspections.

In NJ, 1.5x security deposit is legal and standard. You need to charge more rent, like $100 more and do 6 months inspections. Assuming you know about the ESA before the lease is signed, tack on another $100 to the rent. It's not pet rent, it's the rent you charge. Six month inspections are critical of any rental, but especially with animals. You catch problems early and can charge back repairs. Almost all issues I've seen from tenants can be fixed with periodic inspections, which most self managed landlords don't do.

Like Shawn, I invest in Northern NJ and do very well even though Ive only house hacked for a few years. Already getting ready to buy more with 20% down. It's a higher learning curve due to high price points and tenant friendly laws but far from impossible. Go look up Shawn's YouTube and Jonathan Greenese YouTube.

If you're still apprehensive, go invest in PA like some people suggested. Lower price point, landlord friendly and within a few hours drive. But don't sleep on NJ. I've talked about this ad nauseam on BP but we have high appreciation, low vacancy rates and high rents.

Here's a link to the first litigation filing by AHP. I just received an email for the webinar link on Jan 30.

https://go.prereo.com/e/1024681/kQVfA1qH0fI6c2a6w3D-reserved-0/4hpkfm/215224722/h/_pgmWKxb6KTbwclPueI67fT_dV74FYrpyjvPonpkHlw

Quote from @Mike Adams:

Quote from @Mark F.:

Quote from @Mike Adams:

Quote from @Mark F.:

 Since NJ is automatic renewal State; what advantage do you have from a M2M over annual? You cannot just throw them out on a M2M lease.

 If you lock in a tenant in a year lease, you must wait until the lease is up to raise rents or literally do anything. Like changing their lease or adding rules they could be violating such as pets or behavior. If you buy a place with m2m tenants (I've found most NJ tenants are on m2m leases with old landlords) or set your tenants up that way, you are able to raise rents before that time period. In my experience, this entices tenants to leave sooner.

I don't see one advantage to doing a yearly lease. What if the tenant sucks? You're stuck for the year. At least with m2m I can have conversations about raising rents within 60 days. Again, my big thing is I don't want any tenants living in a unit where they don't want to be there.

 If their rent is so under priced, the 3%-5% the muni will allow you to raise them wouldn't push them to leave. I'm dealing with this in West Caldwell. One of the tenants hadn't been raised in 12 years. 3 bedroom at 950 a month. The other three are new tenants; paying 1900-2100 a month. Seems they will never be leaving. The big increase of roughly $40 bucks a year isn't going to get them to move.

Been doing this for over 18 years with my own properties and then managing others with my broker's license. There's no judge in North or Central New Jersey that will evict a tenant due to a pet violation. As for behavior, unless there's a threat and a police report; you ain't getting rid of them either. 

You still haven't given a good reason why anyone in NJ should go with a year lease over M2M.

Not all towns have rent control or capping raising rents at 3% to 5%.

My eviction attorney disagrees with you on no judge in nothern NJ evicting a tenant over a lease violation. Behavior can be lease a violation, as long as it's reasonable, as described in letter E of eviction reasons in NJ Truth in Renting PDF. 

Quote from @Debbie Fales:

Also, consider what funding source you plan to use for your investment. Most private lenders won't lend to individuals, and instead make business loans that require an LLC.

As a private real estate lender, NavCap makes loans to clients for investment purposes. Since we don't require income or tax statements to qualify, we consider the value of the hard asset associated with the loan—in this case, the rehabbed or rental property. Unlike a residential home mortgage where the owner occupies the property, these short-term hard money loans are business loans—not consumer loans. As such, borrowers are required to establish an LLC to receive the funds.

An LLC provides some benefits to you as the investor too — namely, it provides:

Limited liability: An LLC can protect your personal assets from liability in the event of a lawsuit or financial default.
Tax benefits: There are some tax benefits to using an LLC for real estate investing. For example, you may be able to deduct losses from your personal income taxes.
Credibility: An LLC can give you more credibility with lenders and investors. This can make it easier to get approved for a loan or to raise capital.

Lots to think about...good luck on your investing journey! 

Please provide a source for your statement of tax benefits from using an LLC. You can't because there aren't any.

And credibility? What hocus pocus shiit is that? Sure, many HML won't lend to a person but an LLC, but to insinuate having an LLC gives you more "street cred" is absurd. Maybe if you stopped trying to push your company so hard you wouldn't exaggerate.

Quote from @Devin Ponda:

Quote from @Chris Seveney:

@John McCullough

Companies that have good reputations are PPR, aspen and Labrador lending

 Chris, 

Would you be willing to let us know if you've invested in any of these 3?

-Devin

 Since Chris can't say this, I will. Chris runs a debt fund, 7E investments. You can find tons of info on YouTube, Google his name or company, his podcast (creating wealth Simplified) and website. People have posted about it on BP too. I invest in it and have been happy. Excellent communication by his team and hasn't missed a distribution in almost a year ive been invested. Minimum $5k investment and pays 8%. 

Quote from @Mike Adams:

Quote from @Mark F.:

 Since NJ is automatic renewal State; what advantage do you have from a M2M over annual? You cannot just throw them out on a M2M lease.

 If you lock in a tenant in a year lease, you must wait until the lease is up to raise rents or literally do anything. Like changing their lease or adding rules they could be violating such as pets or behavior. If you buy a place with m2m tenants (I've found most NJ tenants are on m2m leases with old landlords) or set your tenants up that way, you are able to raise rents before that time period. In my experience, this entices tenants to leave sooner.

I don't see one advantage to doing a yearly lease. What if the tenant sucks? You're stuck for the year. At least with m2m I can have conversations about raising rents within 60 days. Again, my big thing is I don't want any tenants living in a unit where they don't want to be there.

Quote from @James McGovern:

Should I offer discounts to members of Law Enforcement to lease with me? Feels like having law enforcement in the building could prevent many problems. Are you offering any discounts to members of law enforcement?

I'm in LE and a landlord and no, you shouldn't. Large apartment complexes sometimes offer a discount to cops who live there and have jurisdiction in that complex. These discounts or even free rent, come with some stipulations. They are responsible for service calls within the complex or are to be notified when a call comes in, like a point of contact. Sometimes they have to lock up communal spaces or required to do rounds of the property. They usually must have a take home car and it must be visible in the complex. If a noise complaint or something similar came in, the office who lives there was usually the one to handle it or at least the first one the cops would call. Think of it as a first line of defense for low hanging fruit. Obviously they wouldn't be handling domestic or dead body calls. Other than notifying management.

I assume your outfit is not big enough for this benefit. If it is, you can talk to large PM companies to get a template. You would then call the local PD to see if they'd advertise it to their cops. We had it at my old department and it was a coveted perk that I never got to take advantage of.

If you're a smaller mom and pop, you have some expectation this person would advertise they are a cop such as a take home car, walking around in uniform, etc. Not all departments offer take home cars. Cops worth their salt don't want attention as they won't want to be bothered off duty. They won't get involved unless some sort of threat of life and other times, they are told to call 911 and make a great witness. I don't think there's a big of benefit as you expect and I don't recommend investing in areas where you need LE presence.

Plus there's lots of cops who dont live in the jurisdiction they work, which may mean they have zero authority where they live unless, again, there's a major event involving loss of life or a threat to the public.

And like Russel said, there's always sh*t head cops who could be worse than attorney tenants.