All Forum Posts by: Melissa Hartvigsen

Hello @Hong Yang,

I am a realtor, and I would never advise my client to buy a house (or duplex) with a leaky basement without doing further investigation.  Without knowing the source of water, no one can ball park the cost for you. During your due diligence period for home inspections, you should have professionals come out and give you estimates and base your decision off of that.

If the contractors who do this type of work in your area are not available during the existing inspection period, your should instruct your agent to negotiate with the seller to allow you more time for due diligence. Once you have estimates, your agent should help you either negotiate a lower price to offset the cost of the repairs; or have the seller complete the repairs (using a mutually agreed upon contractor) prior to closing, and allow you to re-inspect to make sure it has been done correctly.

If the seller is unwilling to give the extra time for you to gather bids, then personally I would walk away.

Melissa

Hello @Nick Riddle,

I see a few options for you. 
1. Talk with a CPA and change your write offs to show more income, and do this for a couple of years. Then make your purchase with a conventional or FHA loan.

2. Is there a close friend or family member with excellent credit and a traditional w-2 job that can co-sign so you can buy now with a conventional or FHA loan?

3. Go "non-QM" or seek Private Money. Some lenders will use these terms interchangeably. These loans are great for self-employed folks because they can use your bank statement deposits instead of tax returns, and may count rental income for you to qualify. Be aware, they charge more on the interest rate (it will likely be 9% to 10%).

The benefit to option 1 and 2 is that interest rates are more attractive. The benefit of option 3 is that you can get this done on your own and as soon as you find the right property.

If you have not met a lender that you can talk to about non-QM options, use the BP directory for lenders. You can also make a post for your market asking for recommendations for lenders from the BP community there.

Best wishes,
Melissa

Hello @Justin Denfeld,

I don't know of any property managers that do room-by-room, but I do have a couple of short-term/mid-term property managers for you. The going rate for this type of management is 20-25% in the Portland Metro.

https://stayawhilepdx.com/about-us

https://www.stayinmydistrict.com/

I hope this helps!
Melissa

Hi @Roman Randall,

Yes, you should be doing interior and exterior inspections at minimum once per year.

You can save yourself thousands of dollars by checking on your investment. At best,
tenants with great payment history can miss items that need maintenance:  for example a small leak under a kitchen sink that goes un-noticed that gets to the point of mold growing and cabinets that need to be replaced.

Many of investors that have horror stories after a tenant moves out with costly repairs had tenants that paid on time.  In fact, I just did a consultation for someone who only inspected during the first six months of a tenancy that lasted three years.  They never went back because it was clean at the six month mark and rent was always paid.  The tenant just moved out: the yard is overgrown (past my knees for about 70% of the yard and taller than me in some places), they left a truckload of junk behind, the carpet that was brand new at move in is stained, and about a third of the house needs to be repainted after all of the necessary drywall repairs.

Your local landlord association or REÍA should have a checklist template for rental inspections that you can use as a template.  

Melissa

Hi @Jeff S.,

I am in Beaverton and will send you a PM with some local window contractors.  Several of my clients have used them.

Cheers,

Melissa

Hello @Tyler Woolums,

In most states the real estate purchase contract says the home is "sold in as in condition". Even though that clause exists it has become standard practice for buyers and their agents to use the inspection to re-negotiate terms (ask for repairs or a price reduction). 

In Oregon where I practice real estate, if a buyer and seller agree upon repairs, then the buyer has a right to re-inspect and confirm the repairs were actually completed.  It is standard to request the work be done by a licensed contractor. If the repairs are not done the buyer and seller can agree to extend the contract, and give the seller a change to repair again, or the buyer can terminate. In Oregon if the buyer didn't re-inspect and took the seller's word, then they don't really have any recourse. 

Usually for claims that arise after closing, the recourse for items costing under $10,000 is to go to small claims court. There you would likely have to pay $200 - $300 for filing fees, and it isn't a grantee that you will win your claim for money.  I would suspect that repairing the leak and patching the drywall is less than $1,000, and not worth your time to pursue in court.

Melissa

Hi @Jordan Bradberry,

Since this is off topic I replied to you directly. Thanks!

Hello @Ashley Barlow

Moving forward, I recommend that you set up the Airbnb account in your name. If you opt to hire a property manager (PM), add the PM as a co-host. Airbnb let's you as the primary host restrict what permissions the co-host has. That way you will always have control over your account. If you decide to change PMs in the future, you can just de-active them as a co-host, and can keep your listing and reviews.

Good luck to you!
Melissa

Hello @Ben Brown,

I strongly advise against getting a student loan to use as down payment for a house. Student loans are the only type of debt that you cannot get out of, except by repaying them. Should you run into financial problems in the future you cannot claim bankruptcy on a student loan. Also, if you decide to take out the student loan for your down payment anyway, this will count in your debt ratio and will reduce your buying power.

There are other ways to buy a house with little or no money down.
1. Save for the down payment on your own.

2. Ask family for gift money.

3. Partner with someone.

4. Connect with local lenders in your area to see if you qualify for a first-time home buyer incentive.  This may come in the form of a grant (money you don't pay back), a loan that does not require a down payment (USDA if you buy in a rural area), a second mortgage with no interest and payments unless you sell or refinance.

There is no such thing as free money, and the programs have up front fees, but if that gets you the down payment you need much faster than your rate of savings it is worth considering.

Good luck, and I hope you get your first house hack going soon!
Melissa

Hello @Billy Knox,

All realtor commissions are negotiable, and it is most common for the seller to pay both the listing agent and buyer's agent. The seller has the right to say they are only offering a commission to the agent selling their house. 

I am a realtor in the Portland Oregon market.  Generally speaking the seller is in a better financial position to pay the agents due to equity in their home. In my entire career, only only two seller clients had to bring money to closing. I remember one of them had some unforeseen circumstances and was 2 years behind on mortgage payments. If they had been current on their mortgage, then they would not have had to bring money to closing.

Most of my past buyer clients were first time home buyers who could only afford to put 5% or less down.  If buyers will be required to pay their agents directly, I think this will reduce access to home ownership for many first time home buyers.  Seasoned home buyers who not purchasing their first home would still be in the market.

What do you think?

Melissa