All Forum Posts by: Mary El

Can I sell a rental property and buy a franchise business?

We have 3 furnished rentals all exclusively advertised on FF. Our furnishing budget is calculated so that we get our $ back in 7 months. Compared to our long-term rental price (before conversion to FF), we increased our rent by almost 70%. For example $1450 to $2450. Yes, we now pay utilities but we don't pay for TV. Instead we put the smart TV into Roku's guest mode and they log into their own streaming services. Our vacancy rates are between 2 and 5% but we are VERY proactive on reaching out to prospects. Oh, and not all our tenants are nurses. We've had relocators and a traveling IT professional. Overall our experience has been 100% positive.

I tried looking for the REO department at a bank and found their web paging, which said they only sell via agents (MLS). Do banks no longer sell their REOs directly (and at a discount)?

Any advice for buying REOs would be appreciated. Thanks BP community!

One more thing about FF...

Be sure to read the unmatched leads to increase occupancy rates. Sometimes the reason for not matching is overcome by simply exchanging a couple of emails. 

I have 4 properties on FurnishedFinder.  My experience has been 100% positive and doing MTR has increased my cashflow substantially. 

Things I've learned about FF and MTR:

1) In over a year,  more than half of the renters were folks relocating to the area. And one is an IT professional. So not all/ exclusively travel nurses. 

2) Extensions have been the norm,  not the exception.  This has been great for us. We do charge the cleaning fee for each extension and send in the **professional** cleaning crew.  A good cleaning crew is 100% critical for us because we always accept pets; which is a big differentiator.

3) I have refunded cleaning fee 2x because the nurses left the place ridiculously clean! Probably just lucky but that's been our experience. 

4) MTR ensures we get into and professionally clean the place every 3 months. Recently converted an LTR where tenant trashed $10K of carpet and new paint that had been done 18 months earlier! Finding dog poop in the closet made the decision to convert pretty easy. 

5) We furnish our places by budgeting 7-months to recover the costs to furnish & stock them. Stock = dishware,  glassware,  cookware,  linens,  etc. Everything that isn't furniture. For example, if we can increase rent (from LTR to MTR) by $1K/month, we spend ~$7K to furnish and stock.

6) We pay for a professional laundry service to wash & fold our bedding and towels and couch protectors - every month. Renters put everything in a commercial laundry bag and leave outside on pickup day. Laundry is returned 2 days later.  PROS: They get everything cleaner and treated for pet stains/orders. Guarantees at least 1x/month washing. Saves wear and tear on W/D. CON: Have to buy double of everything!

7) Might be obvious but we pay all utilities. 

8) We only use digital locks. No keys. Tenants pick their own code so it feels really personal. 

If you can throw in an Airbnb, you can use that to offset the active income of your fix & flips. Defn talk to your CPA. Ahead of that,  read Section 4 in the link to the real estate CPA.

Sounds wrong to me. I've only heard of requiring new appraisal if you want LTV to be based on current market value, vs the refi mortgage amount ($275 in your case). Curious to hear from lenders/brokers.

Cash out "refi". If you don't have an interest rate to protect, then you can shop around :D Basically you just get a mortgage. Look for DSCR loans and apply using your LLC(s).

 Membership requirements

@Jonathan Taylor could you give an example of a case where you did a 2nd on an investment property vested in an LLC?

I've got a couple properties with conventional loans at sub 4% and ~50% equity. I don't want to do a cash out refi and lose those great rates but I'd like to access the equity.