All Forum Posts by: Michele G.

Are you trying to get a personal loan for the investment property? I talked to a guy up here from mb Financial yesterday. He was willing to do a 30yr conventional up to 450 (maybe 475 I don’t have my notes here) with a slightly higher rate because it’s an investment property. If I ran it through an LLC it would be a completely different issue.

I would check with your bank about their stop payment policy. Our old bank would charge the fee to place a stop payment, but they would not guarantee that the first check would not be processed as well as the second. They stated they would make every effort to not process the first check, but sometimes it slips through the system. They specifically told me it was possible for me to end up paying for both checks. That is why I do most payments electronically now.

Am I misunderstanding the listing? Does the business generally come with the property? I understood it to mean the property was for sale and the tenant was an ALF who was willing to sign another 5 year lease when their lease expired. How would that be any different than buying an office building and leasing it out to an ALF? I have no desire to oversee a business (I already have 3 counting my real estate investing).

Thanks for your advice. Should I stick to using COC & monthly cash flow as my metric for whether to investigate a potential property further? I can’t compare properties on a $ per door metric since some have 1 door and 6 beds and others have 3 doors and 3 beds. How much should I allot for vacancy in a high demand student rental market that rents units out a year in advance? I used 3%. The unit is rented for the next 2 years. 1 year leases are the norm so the students pay even if they leave for the summer. There is only a 2 week period properties are empty to allow for turnover repairs & cleaning.

Is there a search word I should use to look or would I need to go down to the county offices? I found the info once for the next county over a couple of years ago, but now I can’t find that info anymore and I’ve never been able to find it for my own county.

Should I be using the cap rate to analyze student rentals? Each property is different because they are usually converted houses. Some are one big house with 3-6 bedrooms. Others have been split into separate units with their own kitchens and utility meters. Given the different structure of each unit I was thinking it might be better to use the cap rate. My vacancy % is low because 99% of student housing has been booked for next school year. The signing period opens in September for the following year. This particular property is rented through 2020 so I know what my income will be for the next 2 years. 

Am I missing anything? Does this look like an ok deal? 

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Is there a way to find out how much someone owes on a property?

I was researching this in my area tonight. Our state puts them online & separates foreclosures (live auctions) from bank owned auctions (usually online). There is a lot more inventory than I expected. I’m interested to see how much they actually sell for. There is an auction this week close to me. I may go see how the process works.

It is a condo in OC. The buyer would most likely be the homeowner and not an investor. So they will want to move in and not put money into remodeling. 

While I have been looking for properties I have come across several SFHs that have Assisted Living Facilities operating out of them. I had didn't realize this was a trend. Some of the listings say the ALF is a tenant and has a multi year lease. Others specifically state the business is being sold with the property. I have no interest in running an ALF business. I have done some research and the state does allow these businesses in residential homes. 

My goal/focus is to find a passive income, cash flowing property. Should I steer clear of these properties or could this be a good investment if the numbers work out?  Are there risks involved if I am merely the property owner and not the business owner? The businesses are already established in the homes and the one I looked up has had regular state inspections each year.  What additional due diligence should I be doing? I am thinking this deal would be a hybrid of a commercial and residential purchase. Things I am thinking of....

• Verify the city allows this business to operate in a residential neighborhood
• Verify the house is up to code for the type of business 
• Would I need a different type of insurance or higher limits
• Who would be responsible for any upgrades to the property if code changes for their business
• Is this any different than a commercial building leasing space to an ALF?
• Are the properties altered significantly so that if the business decides to leave at the end of their lease it would be expensive to convert it back into a SFH?
• How big of a concern is there if people were to die in the house? I know that has to be disclosed upon sale, but what, if any, would my responsibility be to know that information? How much could that potentially affect resale value?