All Forum Posts by: Michael Craig

@Kip Cline these supplies are tax deductible. This is done by filing a Schedule E Form. Find yourself an accountant who has experience with real estate. They will be sure to get you the highest return within legal parameters. 

Be sure to keep all your receipts. Disclaimer: I am no means a CPA  

@Horacio Gutierrez  low cost renovation tips:

-no carpets, vinyl planking works great through out entire rental (including kitchen and bathroom)

-fresh paint on all interior walls and trim and new outlet covers on each outlet

-service/replace furnaces and water heaters depending on age as these typically fail at worse possible times 

-add door stops on each door

-kitchen cabinets usually can be reused, a paint touch up can go a long way

@Horacio Gutierrez  I don't have a percentage for you as the renovation costs will vary based on the current house condition and your desired outcome. The desired outcome is based on your market and the tenant class you will be renting to. If you haven't done so already, learn the market (average monthly rent, common amenities included in rent, etc.), what other rentals in your area look like after renovations and the tenant class in your market.

Something to keep in mind when refinancing multi-family homes: the higher you can get your rent, the higher your house will appraise for, thus allowing you to pull more money out. Just be sure to keep the renovations within what the market will allow you to rent. 

Also know where to spend the money and know where you can hold off by repairing existing equipment. Find below and article from Landlordology titled "How to Maximize Your Rental Income through Renocation & Decoration":

https://www.landlordology.com/renovating-for-rental-income/

I hope this helps.

@Trevor Montgomery worry about acquiring  your first deal, filling it with good tenants and getting it to cash flow/turn a monthly profit before worrying about your next deal. If you can do all that, your lender will be less hesitant about giving you your next loan.

@Brian Bistolfo all good points mentioned above, consult ins. broker, consult attorney etc. etc. 

It seems like these tenants have their hearts set on having mom live with them. Are these good tenants? Are these tenants you would like to keep? Do these tenants plan on staying for an indefinite amount of time?  If so, I would want to keep them, assuming your talk with the attorney and broker go well. I would include mom on the lease and increase the rent $100 to $400 a month (depending on whats reasonable given the extra liability and your market). The increase is not because of her age but simply because of the additional wear and tear that comes with another tenant. (also by giving them this option you put the ball in their court and are no longer the bad guy)

This way everybody wins, current tenants live with mom and don't have to uproot their child's home, attorneys/brokers get some action and you keep good tenants and are compensated for the additional tenant.  

@Andrew Yu if both tenants were on the lease then both tenants are severally liable. If the guy is willing to cover the entire cost of rent moving forward then there is no reason to go after anyone. However, if the rent is not paid or partially paid, I would have them evicted and recover all unpaid rent, damages, costs etc. from both parties. Hope this helps and good luck.

@Richard Bader like Michael said you generally can use any criteria as long as it is not discriminating against a protected class. What I find helpful is to outline your qualification criteria (household income 3x times rent, 1 year of continuous employment, a certain credit score, etc.) on the application, that way undesirable tenants can screen themselves by not applying or if you happen to turn down a candidate, you have documentation supporting your case and why you did so.

Another point in regards to your "verifiable income for a year question" is: you can have the candidate list employer references, which will allow you to contact their supervisor/manager and ask about their employment status and in this case their employment history. Hope this helps and good luck with your screening!

Luis, it depends on the tenant and portfolio size. Cozy is a great site to track payments but not a lot of people are familiar with it. Venmo is popular among younger tenants (20s-30s), funds are transferred instantly and there are no fees. I do not have any problems using Venmo with my tenants (granted I'm only managing a three family home at the time).

Dear @Satya Nagarajan, thank you for sharing. Issues will pop-up in life and in real estate. Listen to BP podcast ep. 108.

Hi @Satya Nagarajan, I cannot tell you what is normal but I can share my experience with you. 

I purchased a 3 family home July 2017 where I currently reside. I inherited two tenants (both were on month-to-month leases). One of the tenants was evicted immediately for not complying with the new lease I presented to them - the other tenant still lives onsite. 

After renovating the apartment where the evicted tenant lived, I found new tenants to occupy it. Finding these tenants took time and actually required me to turn down other applicants (not meeting criteria). Currently all residents pay on time and appreciate the living situation. We all live peacefully together.

The reason I share this is because upfront screening and explaining the expectations and house rules is very important. Also, there is no reason for people to be living in tension.

Mike