All Forum Posts by: Michael Brown

Sorry to resurrect an old thread, but I am making adjustments right now my lease agreement to include several new fees. One of those fees is a "service of notice charge" which I will charge every-time a notice must be served that is the result of tenant. Whether that notice is to remind them not to smoke in the property, a pay or quit notice, a pick up you pets crap notice etc. If I have to be inconvenienced due to their not abiding by the rules, then you had better believe I'm going to charge for it. Just my opinion, take what you like and leave the rest.

Glad to hear your hard work is paying off! 

Correction:

5. Because other people are doing it succesfully (see article here from BP Member Michael Blank http://www.biggerpockets.com/renewsblog/2015/06/29/deals-contract-negotiation-tip/?utm_campaign=June%2030th%202015&utm_content=control&utm_medium=email&utm_source=vero&utm_term=Newsletter&vero_conv=800542900&vero_id=274281)

Hi @Andrew Whicker:

I know this is an old thread, but I stumbled across it in my search for a template so I thought I'd add my two cents.

I very respectfully disagree with @Dion DePaoli and @Wayne Brooks. I think that a well done letter or better yet video is an excellent way to increase your odds of getting properties under contract because:

1. It is an instant credibility builder, you get seen as someone who knows your numbers and is confident in what you do.

2. It sets you apart and makes you unique from probably all other offers.

3. Proves that you are not just low balling the seller, but rather that you are a savvy investor looking only for good deals that meet your criteria.

4. Your going to do the math and due diligence anyways so put it to work for you.

5. Because other people are doing it succesfully (see article here from @Michael  http://www.biggerpockets.com/renewsblog/2015/06/29/deals-contract-negotiation-tip/?utm_campaign=June%2030th%202015&utm_content=control&utm_medium=email&utm_source=vero&utm_term=Newsletter&vero_conv=800542900&vero_id=274281

I have a similar issue:

Property is  an owner occupied triplex, my unit 1 tenants would like a fire pit and would use it to burn up some scrap brush that was left over from keeping the grounds.

These tenants are excellent and I want to let them know that I want to keep them happy, but I can see all sorts of issues with allowing a fire pit.

1. 1. It would be unfair unless I let the other tenants use it as well (which I don't feel as comfortable with).
2. 2. Liability issues which means I'd want the tenants to be insured and responsible for any accidents.
3. 3. The possibility of encouraging drinking and "gatherings"  outside at odd hours.
4. 4. Having one more thing to monitor and develop rules of use for...

In the end I can't justify all of this just to keep a tenant happy.

Any thoughts on how to respond to my tenant in a way where I don't have to say "NO", but rather help them reason their way into thinking it is a bad idea as well?

Thanks!

Is this a common issue where you live? I've never heard if it before.

I always lean toward less insurance for this type of thing. The insurance company only makes money if they pay out less than what they get in (obvious I know), but my point is what if you took the money you'd pay them and put it into your next deal or an interest bearing investment? You could be your own insurance so to speak.

I also shoot for pretty high deductible insurance as well (currently $5000 on my triplex), I'd actually go higher, but I'm not financially able to take a $10k hit out of pocket yet.

All the best,

Hey @Kevin Izquierdo

Great question! Although I do not have a definitive answer for you, what I do know is that you will be hard pressed to find a bank who wants to be the second place lien on a mortgage product. Basically what that means is if you are second place, the first place lien (in this case a mortgage) is going to get it's money first in the case that you can't perform your obligation (make your payments).

A fail fast and cheap idea for you would be to try calling a loan officer at a bank and asking the same question. You'd get an answer and explanation quickly that way.

Best, 

Hey @Dev Horn, thanks for the info. If I end up making an offer through them I'll be sure to post my experience here.

Has anyone heard of Propoffers.com? I stumbled across a property in Maine that says all offers must be made through this company. I'm interested to know if anyone has any experience making offers through them? I've done the basic Google search for them, but I don't turn up much at all.

See listing here: http://www.zillow.com/homes/for_sale/West-Bath-ME-...

Thanks,

Hi BPer's,

I am looking at possibly purchasing a duplex property as my first buy and hold, would you give me your feedback on this SELLER FINANCED analysis?

Listing Price: $122,900

Closing Cost (6 months of taxes and insurance): $1,800

Repairs: $2,000

ARV: $110,000 +/-

Amortized: 30 years

Offering:

Offer Price: $91,000 (MAO: $95,000)

Down payment: $13,650 or $14,250 (15%)

Loan Amount: $77,350

Interest: 5%

Interest only payment (for 3 years): $322.29 (at offer price); $336.46 (at MAO)

Balloon at 3 years: $77,350 (at offer price) $80,750 (at MAO)

Income:

Gross Annual: $18,900

NOI: $7,189

Note: Rent in one unit will eventually be raised by $75/month

Expenses:

Vacancy: 5% (this is a high demand rental area)

CapEx: 10%

Repairs: 10%

Management: 14% (will self manage at first)

Taxes: $2,600 annually

Insurance: $1,000 annually

Grounds maintenance: $600 annually (property is on a 0.07 Acre lot with almost not lawn. Most of the $600 will go to plowing in the winter)

All utilities paid by tenants

Thank you for taking the time to share your thoughts! I really appreciate it.