All Forum Posts by: John Newman

It helps to have roommates that you get along well with.  I've had my share of good and bad ones.  I would say that renting to friends is not out of the question.  Just screen them the same way you would any other potential tenant; income, credit, references, criminal, employment verification, no evictions, etc.  Require them to sign a lease.  Be professional.  Set clear expectations that you're not going to give them any consolations just because you're friends. Get a fair security deposit and charge a market rent.  

You can also get parents to cosign the lease.  

I'm with @Steve Rozenberg.  A convenience fee or transaction fee will likely be less than a late fee.  I think she will figure something out when she receives that first notice.  

Hi @Andy Basler,

I would buy two washable, reusable filters for every HVAC unit.  When you change them, install the clean ones and take the dirty ones with you.  Then you can wash all the dirty filters at the same time, probably 15 minutes with the garden hose.  Let them air dry and simply swap them out next time.

This will save you a lot of money on filters.  The high quality reusable filters are typically 3X the cost of the single use pleated ones, but can last a lifetime (many of them have a lifetime warranty).  They filter better and will extend the life of your HVAC equipment.  

With regards to the interval, you should really be changing/cleaning the filters monthly or bimonthly, not every 6 months.  

I only use high quality washable filters and clean them monthly.  It's well worth the time.  

Hi @Luis Rojas,

I am also working on a deal for a house in Raleigh with a damaged septic system.  In my case, the septic was too far gone to be repaired, and replacement cost just wasn't worth it.  I had a couple plumbers come out and quote on connecting the house to city sewer, since it is available on this street.  I had several people recommend doing this for long term reliability and maintenance reasons.  You can't always trust your tenants to respect the septic system.  I compared a pump driven sewer connection and a gravity fed sewer connection.  Gravity is more reliable, with no moving parts to fail, but can require a higher upfront cost for digging.  

Here is a rough estimate of the associated costs:

Sewer Tap: $3500

Capital City Sewer Fee: $1500

House to cleanout connection: $8500

The city can install the tap for you or a licensed utility contractor.  They will also place the cleanout somewhere in the front yard.  Any plumber can connect the house main drain to the cleanout.  The biggest factor in determining the cost is the depth of the sewer main.  Once you go past 12 feet deep, they will no longer be able to trench with a mini excavator, and will have to bring in a full size excavator.  The deeper you dig, the more dangerous, the more safety precautions are needed for the install, the more money. 

"When it comes to effluent, the less I have to see it, the better." 

Maybe @Upen Patel can weigh in.

I have also found that the interest rate depends on the loan amount in addition to the down payment. Some lenders don't want to offer loans of $100k because they don't make as much money on them. Instead of saying no or charging more fees, they generally charge a higher rate. On a $200k loan, the same lender will probably offer a lower rate.

I am curious about the rents in this area.  I used to work in Middletown a few years ago.  Is this near the local Penn State campus?

I am also a big proponent of the mini split system.  They give you a lot of flexibility (no duct work) and much greater efficiency.  I'm not sure what the cooling needs are up in Massachusetts, but anytime you can offer heating and cooling with one system, that's a bonus.  The heat pump will be more efficient than electric heat, and not susceptible to variations in fuel prices.  Installation costs are very reasonable as well.

Hi @Uriah D.,

That's great news!  I'm glad you were able to get a better deal.  I would definitely do that one.  Let us know how it goes.

@Jenna Cameron and I will both be at the meetup on Thursday so hopefully you can share more with us then.

What they're offering you is called Lender Paid Mortgage Insurance or LPMI, in which they pay the PMI for you in exchange for a higher interest rate.

Whether it's worth it or not depends on how close you are to 80% LTV and how long you plan to own the home. Mortgage insurance is currently tax deductible, although that may change very soon. Mortgage interest will likely remain tax deductible for a long time.

Regardless, I would not pay a fee for this. Also, I think the interest rate increase is too high at .5%. I know lenders that offer LPMI for .25%.