All Forum Posts by: Mike Dorneman

@Steven Joseph Fogarty Adam Corolla also did about 4 years ago 😂

@Benny Gelbendorf you can get very close by calling the local municipality in which you plan on buying. Many of the areas we own in have water, sewer and garbage directly through the county, so they’ll be able to give you a fixed cost on garbage. My country also has a fixed sewer cost ($75/month flat rate). Water will vary based on consumption. Personally I factor in $50/month, on average most of our proertiesnuse about $40/month with a random outlier.... As for electricity, your tenants should be responsible for that because it’s completely based on their behaviors and car vary widely. I also have a $50 max water clause in our leases. Eliminate all risk of unexpected exposure and only commit to fixed costs as much as you can. Run this like a business (which it is). Landlords “guess” what hire costs / profits will be each month, business owner know what they will be. Best of luck!

@Joe Benson What are properties in that price range currently fetching for rent?

@Dick Stevens I would agree, usually. In this instance, the tenant has passed our credit, eviction, employment and criminal record check. He just retired with an honorable discharge after 20 years in the Marines. He says that he’d like to just pay annually so he doesn’t have to worry about monthly. Trust me, I’ve turned these offers down before and I’ve heard many stories from potential tenates from all our other properties. However this one seems legit. I’m more interested in what, if any legal implications this could possibly lead to...

@Deanna Sapp That’s a BRRR! 😁 Buy, Renovate, rent and repeat. I buy every property with cash, renovate it, get it rented, then HELOC or HELOAN my cash right back out for the next deal.

@Joe Benson Depends on your budget, your time and goals related to cash flow and appreciation. If you could lay out your “best case scenario”, it’d be much easier to give you some specific advise.

@Benjamin Z. Pickens Hey Ben- If you could provide some details about the deal like property type, cost, cap rate, estimated renovation cost, rent, etc... can’t really answer your question without knowing any details.

I know everyone has an opinion on accepting rent on an annual basis Vs monthly, however I was hoping someone could speak to the legal implications accepting an annual (or 6 month) rental payment. The obvious issue could be if the lease is violated and the need to begin the eviction process comes up. I would think a prorated refund would solve for this. Thanks in advance!

@Chris Montalvo This is very common Chris. Typically 80+% of homes sold have a mortgage hold still on them at closing. The title company or lawyer you’re using distributes the funds at closing to the lien holders in corresponding position then the seller. Additionally, buy purchasing title insurance you are protecting yourself against any other lines that could possibly exist and were not identified. Go forward!

@Jenny Cuevas Hi Jenny- I’d be much more inclined to go with the agent who is also an investor themself. Agents that that understand investing and basic principals like cash flow and appreciation are an enormous value add Vs the agent who is showing you a house because it has a “pretty” kitchen. Find an agent who understands your business model and understands that an investors needs and wants are far different than a buyer who is looking for a “home”. Good luck!