All Forum Posts by: Jeremy G.

I need to occupy within 30 days according to the mortgage broker and the paper work i've been over.

well heres the back story, the seller and her husband had the house on the market for about half a year, because the husband was diagnosed with brain cancer, they wanted to sell the house before he died so the wife and kids didnt have the burden, well he died last month, so the seller is a grieving widow, and having to deal with a scum bag tenant who prolonged the house sale long enough for him to pass before it could complete. The husband was so very thankful that I was a respectful hard working single dad and didnt want to evict his long term tenants they were so happy to sell this house to me, and the other tenants were so worried that some investor was going to come in and buy the house and clear it out, they were very thankful that I was deciding to purchase it as well. I truly think that maybe the seller with held the information from her agents because she was scared I would back out of the deal she just got stupid while grieving for her very recently passed husband. 

I just dont know what to do, I HAVE to move out of my current residence ASAMFP!!! because I rent a townhouse from my mother and she is selling it. I no longer have the time to find another property It is either this property or I go back to renting for now.  IF the information I have is correct, the tenant could be out as early as tomorrow, or as late as september. I am so stressed out right now I feel like my brain is going to explode. My daughter and I have been living in limbo since april, this our life now, on hold, in limbo, stressed and pissed beyond all recognition

HI!

This is fairly complicated and I'm going to assume most replies will tell me to get an attorney, but I guess we'll see :-)

I am located in NH, I went under contract in April of this year on a $180k triplex, it is two 3 bedrooms and a 2 bedroom. all 3 units collect WELL below market rent at only $160/week. each unit has its own washer & dryer hooks ups, each unit has TONS of extra storage and the 3 bedrooms each have a garage bay all for the same $160/week. 

Average rent for a 3 bedroom in the area is between 900-1300/month. the units are all in good condition and will be receiving some updates once the sale goes through, if it goes through, it will be a cash flowing property even as an owner occupant or at the very very least I'll live for free and have extra money to put away for any issues that may come up. The seller agreed to our P&S price is $174200 with $9200 in seller concessions for closing costs/escrow. the home inspection found some issues, so we amended the P&S and the seller agreed to every single one of them and remedied all of the repairs with professional contractors which included replacing basement stairs, rebuilding the top of the chimney, replacing one of the furnaces and one of the water heaters, among a few other minor repairs. this was all fantastic and im very happy that the seller agreed to EVERYTHING!!!!

But here's where the problem comes in. I am a single dad and will be an owner occupant, so my daughter and I only need a 2 bedroom, from day one the seller agreed to evict the tenant from the 2 bedroom unit as part of the deal, as this tenant had already been violating the lease by subletting to heroin addicts, multiple domestic violence police calls, late rent payments etc, and the other two tenants have been there for a very long time one for 12 years and the other for 20 years. A sheriff removed the tenant on the 17th of april, but then the tenant contacted some legal aid company who filed an appeal with the NH supreme court on his behalf stating he was a veteran(he is not a veteran). its now going on 3 months since the district judge granted the eviction, our close date has been rescheduled NUMEROUS times, and it's costing me thousands of dollars every month that I am not closing. The Supreme court in NH is not going to get to hearing or scheduling this case until around September. 

The seller and her agents(husband and wife team) have withheld this supreme court appeal information from my agent and I and have tried to bribe us to close many times saying "we'll put some extra money in escrow in case there's any problems with the tenant after you close" I have refused to close on this property until the seller abides by the terms. I want a final walk through and I want the building in the agreed upon condition with the 2 bedroom unit vacated and move in ready. If I close and this tenant doesnt get out and I dont move in within 30 days, I'm sure the bank will call the loan or try to take some legal action because I am using an FHA loan as an owner occupant and must move in within 30 days, it could be months before this tenant gets out.

The sellers agent threatened to put the house back on the market if we didn't get back under contract within a a couple days, but its the seller and their agent that are breaking/breaching the contract, they are withholding information and trying to bribe me to take action, to sneakily get me to close. They have offered to compensate me out of contract, because they "want the numbers to stay where they are" 

someone I know, knows the tenant which i didnt know until recently, they are the one who informed my agent and I of the appeal and the lack of military service, she showed me the court documents that the seller and her agents have still not shown us, The person i know that knows the tenant said he HAS NOT been staying in the apartment in fear that the courts are going to find out hes not a veteran and have the sheriffs come arrest him as the court is paying the tenants weekly rent because he's an unemployed scum bag who lied about being a military veteran, She's also told me that he has signed a new apartment lease somewhere else and she has offered to and has started helping him move his stuff out of the apartment.

I forced my agent to get back under contract yet again, she made the close date for tomorrow Friday the 13th of all days, the guy still isnt out of the apartment fully(meaning all his stuff) there are still random people answering the door who are not on the lease who are missing teeth left right and center. still no walk through. yet, everyone still expects me to close tomorrow, I'm telling my agent, NO 

let me guess, contact an attorney? HAHAHA please help?

Thanks 

Jeremy

I'm just starting out about to close on a triplex but the way I understand it, is you have to use leverage if you don't have a ton of cash like me. refinance and take cash out to keep buying properties $100per door per month at 50 doors is 5k/month before taxes as well as living for free. That 5k/mo pretty much replaces my fulltime job income.  So, i guess financially free really depends on what you want it to mean, to me financially free would be living for free and having enough passive income to replace my fulltime job so i have more time to raise my kid and watch her grow up, to enjoy life rather than work for a boss for 2100 hours a year.

I dont plan to move out of the building until after a year due to FHA financing. But ive always been told owner occupied properties are cheaper to insure than a non owner occupied rental. But not according to any insurance companies ive gotten quotes from haha

not in a flood zone and i dont think there are any odd circumstances that im missing, one of the companies insists i have to insure for full replacement costs because its a multi unit property. I have not called the current owners insurance company but i will find out who it is and give them a call. I was expecting between 800-1500/year.. But 2600 is just way to much

Hi everyone!

I currently have a triplex under contract im trying to find an affordable home owners insurance policy, the current owner does not occupy the building and he pays approximately $1750/year for insurance. I will be owner occupying but ive gotten 4 different quotes all of them are for around $2600/year??? they insist they must insure the property for full replacement costs of around $400k 

I thought owner occupant insurance would be cheaper than landlord insurance? these quotes are outrageous.. my mortgage broker estimated my monthly mortgage on a $1200/year insurance policy, so everything isd telling me insurance should not be 2600/year but those are the quotes im receiving, any ideas? or suggestions? 

Thanks! 

the market rents in the area do not include storage, garages or washer n dryer hook ups, these are unique money making units, the average storage unit at a self storage place is around $125/mo I figure I could charge 100/mo per garage bay and 75/mo for the storage units, 3 very large storage units and 2 garage bays, I would keep a garage bay for myself. offering a discount to the current tenants seems like a smart idea.

I was thinking later down the line, either refinancing for 2nd property, or trying to get the permits to turn the finished attic into a 4th apartment and turning the 2.5 story garage into a 5th apartment(townhouse style), then I'd have 5 doors on 1 property, seems appealing though I have not even bother researching this yet because I'm trying to take it one step at a time.

thanks everyone for the replies.

we think we could raise the rent by $70/week or 400/mo incrementally at that point the property will have positive cash flow, I did another walk through today and handed in an offer, asking price is 180, my offer was 160k with 10k being refunded at closing to cover all closing costs, it is only going to cost me $1,000 out of pocket to close on this property with an FHA loan and a down payment grant of 3.5%. Both the seller and his agent know that the rents are ridiculously low and im positive all the tenants are expecting rent increases, I think increasing by $10/week every couple of months will ease the pain for them, I dont mind covering some of the mortgage for the first 6 months or so, even if the tenants decide they want to move, they will start looking at current rental rates in the area and they will be sadly disappointed and will most likely end up staying anyway especially if i entice them with updates on their units like newer flooring and appliances because some of the stuff is out dated. I also received the sellers schedule C today and he makes 24k year from the 3 units 14k in expenses and 10k profit, thats with the rents being so low, I could make the same exact income while living in the 2 bedroom and raising the rents to $1k/mo on the 3 bedrooms.

Does anyone have an opinion on the storage and garages? DO i let the tenants keeps them with the rental increase or should I remove the storage from the tenants, charge extra for storage or rent storage to other outside folks? The storage areas and garage bays are large and absolutely worth considering making additional income on them, again im new and i have no clue how to go about pricing storage and garages.

And yes It will cash flow once I raise the rents, but at the current rent it would be negative cash flow.