All Forum Posts by: Mickey Harrison

just seeing if there's any fellow investors on here in the greater new orleans area?

Welcome Larry,

I'm also new to BP of about 3 weeks now and I'm loving the site. I'm sure you will too

You can call and tell them. However, i think it would benefit both parties if you talked first so see what's going on. If they become unruly, just leave letting them know they owe you for the rent and then get the constables to deliver the notices.In some states/counties the laws says papers need to be served by them to "officially" start the eviction process anyway. you wont have to see the tenants again til they make payment or in court.

During Katrina I lost a property due to flooding. I asked the bank to write me a letter saying they wanted the insurance money to pay off the remainder of the loan before any repairs could be made (since they had interest in the property). I kept what was left and they started repairs with that when i thought the time was right. According to my tax person it was not considered income because there was no profit. IE. House had value 100k loss in storm , Insurance recovers the loss 100k, but you still owe money 60k. left overs are yours from your loss. 40k was not a profit but making me whole for my loss. Therefore not a taxable event..according to the person that was doing my taxes at the time.

I was in a situation like that before. This may sound harsh but, I in formed the tenant that if rent was not paid they would be evicted. The tenant all of a sudden pulled out a butt load of cash and said "i'm moving in 2 weeks can i pay for the 2 weeks and that's it?" I told him no you can pay for the month (and me deciding to be nice) said "On the day i take back the house I'll prorate you the rent back." he left 3 weeks later (i would have lost a week of rent) and i prorated 1 week to him.

In your situation if you don't feel you want to evict him. Yes the deposit is normally kept but it would prob depend on what the lease says. In my lease it says that the deposit can't be used as rent payment. That's why whenever someone is late I instantly start eviction if it looks like I'm not going to get paid.

Also something to consider. What happens if he doesn't leave at the end of the month? You start the eviction process (which can take 2 weeks - a month where I'm at) and now you've lost 2 months rent.

Don't get me wrong I'm not a fan of evictions but i've been nice and screwed over in the past. So now when someone doesn't pay I just play it by the rules. Just remember once the tenant is served eviction papers they have time to pay you the rent and then you can stop the eviction process. But by starting it early on it lets them know this is a business and we're all grown ups

something else to consider or at least from my experience, which is novice in this area. Once you own the lean if the property is not redeemed within in the first year you are responsible for paying the taxes next year (however you don't need to)
Example
In St. Tammany Parish when you go to, lets say june 2011. The lean you are buying is from the taxes that were not paid in for 2010 year. If the person pays the late taxes they owes you all your money back plus 15% (been about 10 years since i've bought some)" and then it's 1% for every month that it's not paid. In order to get the property here you need to wait 3 years but it's really more like 5 to get it quick claimed to you without any problems.

so at action you buy $100
no one pays the taxes the following year you would need to come up with another $100 to pay the taxes but if they do pay the taxes in lets say june 2012 you will get

233 back

100*27% (15%for penalty + 12%first year for not paying taxes)
+
100*6% for (2011 taxes)
_______
$233

just remember every county has different rules. Also don't forget sometimes you need to notify the person that the property was purchased at a tax sale. If you don't you may have problems actually getting the property. This varies from county to county and the laws change talk to a RE lawyer about this if yo plan on trying to get he property and your just not after a nice interest rate.

anyone is open to correct me it has been a while since i've done a tax action and I was a novice at best but that's what i remember from when i would go.

After reading this thread a questions popped in my head.

If you own the property in your name and manage it yourself but you create an LLC for you managing it does this offer asset protection?

-In my case i own 3 houses 1 primary and 2 rentals. All have mortgages. I manage them and have no llc's but I do have high liability on each house and an umbrella policy. The reason I have yet to put them in an LLC is cause of my transfer clause in the mortgage. (diff. topic but have you had a problems with the bank when transferring to your own llc). Would me creating a management LLC protect my assets if sued by the tenants?

If the property is in a llc do you really need to form a LLC management company to protect assets?

I agree with James. A good way to see how bad an area is would be from crime stats. I know here in New Orleans we can go online and get crime stats from the local newspaper. OR like James said go to the police station and ask about the neighborhood. Also, I'd recommend maybe passing by the property on a weekend night.

Not sure if you've had experience with sec 8 but remember that there are yearly inspections of the property that are made by HUD. They really aren't that big of deal but it seems like they always find something wrong fix what they ask (as long as they don't sound erroneous) then collect the checks.
*i know the descriptions of the inspections are simplified but as long as your not running a slum you should pass after your first inspection."

Another thing regarding section 8, don't be lenient on late rent. I've known people to let their sec 8 tenants slide on their portion of the rent. The reason is they feel "well the rents 450 a month gov pays me 400 on the 1st hands down..so what if they're late 50 bucks I got 400." You wouldn't let a reg tenant slip on this i don't know why people let their sec 8 tenants.

@ Glenn I'm also there with ya. Thought about going back to school to get my MBA but not sure what I would do with it.

@ Shanequa oh mean I hear ya on the food. I was away from NOLA for 4 years and it was killing me not being able to eat like people do down here

I have had my house for over 2 years.

- I'm assuming the suggestions on using hard money is so that I can keep my cash in my pocket. In regards to hard money lenders what are the typical interest rates seen now & how do they secure their interest in the property a 1st mortgage or do they lean on another one of my properties? Also has any one ran into problems refinancing or doing a Home equity loan to pay off the hard lenders.