All Forum Posts by: Nick G.

@Kevin Phu All homes have issues. The issues you listed don't bother me, but that's just me. I'd have cured the infestation if one existed, and probably tuned up the roof. Other little stuff, like the bathroom and the lock on the door are easy tiny issues, and the electrical panel is a maybe, only if my electrician thought it was necessary.

$3500 credit to me sounds like more than enough money, assuming further investigation didn't reveal much else, obviously I'm not privy to the details of the property. A credit is the best case scenario though, 99% of the time I never ever want a seller to fix something for me. Give me the money so I can do it right and hire my people.

I'm not saying you shouldn't have walked away, at the end of the day, your feelings are your feelings, and I'm confident your agent advised whatever was in your best interest. Just to me personally, this property's issues don't faze me at all. This being your first property, your feelings are totally understandable, knowing big issues from little ones just comes from experience/guidance. Next time, you could try posting this post before backing out of the deal, just in case!

Keep it up man, I've been following your success and loving the journey.

@Mindy JensenC.A.R. worked with authorities when we wrote the new Wire Fraud Advisory, including the FBI. If you'd ever wanted to do a little PSA on the podcast, I'd be happy to connect you with our FBI contact for an interview.

Personally, I think it fits right in to the podcast - empowering investors to do business better and smarter, and in this case, protect themselves from losing hundreds of thousands of dollars in a matter of hours. I specialize in risk management and forms within C.A.R., and I can say that is no faster-emerging threat to an investor's livelihood in existence bigger than cyber fraud.

@Trevor Baker That's terrible, really sorry to hear that. How did they get in? The answer to that would help me personally focus on where I might focus my efforts.

I agree that an alarm system would be pretty pricey - I'd probably go on amazon, find some fake security camera domes, find a couple "Smile, you're on camera" signs, and put one of each up at key entry points around the property.

Side note, make sure you disclose the break-in to your end buyer once you're in escrow, in order to protect yourself.

Hey @Tim Jones, just chiming in to give major kudos for the great attitude and your aptitude to do what needed to be done. Many people would have thrown their hands up on day 2. Keep it up and you'll go far.

I would accept those terms... but I would make the deal contingent upon you picking up the gum wrapper. And nothing else.

@Bob Razler

Lol. Happens all the time in my market, feel free rerun your numbers and make sure you're not being too optimistic anywhere, but I don't typically consider an appraiser's opinion too highly, especially in a market that I know well. 

Appraisals have a tendency to come in low due to using historical data, a trend which is exacerbated in an ascending market - plus, no appraiser will ever get fired for tanking a deal with a low appraisal, only the opposite.

@Kevin Phu Oh okay, glad to hear it! I was going to be really bummed for you if that deal didn't work out. Happy to lend some perspective.

@Drew Shirley You're hilarious - no, no cigarette, just the blindfold. (My expression was mocking the binding nature of a CA lease agreement.)

You are correct, you're not a California attorney, which is evident because you operate on a healthy Texan rationale, something which California courts sorely lack thanks to our incredibly tenant-centric laws that we operate around.

If a landlord tries to breach a lease, a tenant can easily sue them and win here, any day of the week. I have seen landlords held to honor the lease whether they like it or not plus pay for any damages, pay for the tenant's attorney fees, pay fines related to not following due process in certain areas, etc... It can quickly and completely turn a property from a profitable asset into a year-long non-performing nightmare-black-hole of ROI death.

California is pretty much the last place in the world that a landlord should screw around with tenants. Your ultimate advice, to consult a CA attorney, is spot-on. 

@Kevin Phu Depends, my friend. First off, you have a great plan. Second, VA appraisal guidelines are some of the most stringent out there, your property can be outdated at best, but most levels of disrepair, sometimes regardless of however mild, will need to be corrected before VA will approve the loan. I'm talking things as simple as chipped or flaking paint, electrical wiring that's not properly covered, etc., not to mention that VA still requires termite clearance (though to your second paragraph, the seller does not have to pay for the work anymore, that's a common misbelief.)

Purchasing a property with a purchase agreement and going through escrow in Southern California can be a more complex process than you can imagine, which is why people like me spend years studying it all. I'm a state director with C.A.R., I help write the damn contracts that 99% of California agents use, and I still don't know it all.

Don't let inexperience put you in a position where you're exposed to huge amounts of financial and contractual risk just to try and save a few bucks, that's a rookie move and you're way smarter than that. You might be able to get away with it outside of California, but not here, there's too much risk and litigation.

If you find an off-market listing, I would still have your agent be involved. If you're that averse to paying a fee for representation, maybe consider getting a license yourself - you'll have 10x more legal liability, but you'll save the commission, if that's important to you.

Separate note, weren't you just in escrow a couple weeks ago man? What happened? I've been rooting for you big time!

@Derek Bonanni I'm not an attorney or a judge so I can't answer that definitively, but I suppose it could be possible. If what you have heard about this tenant is true, you will want to dot your I's and cross your T's more than ever in terms of following due process to the letter, since someone like that may know how to game the system if you slip up.

Also bear in mind that just because your lease states something - even if the tenant agrees to it - it may not be legally enforceable, or worse, if it contradicts the law or the tenant's rights, it may be totally void altogether.

You appear to be an agent in CA - assuming you're a Realtor as well, I'd recommend sticking with the C.A.R. lease agreement, since you'll also have C.A.R. at your back in the event that language in the lease is ever contested.

Forgetting legalese and risk managagement and bla bla bla for a second, here's what I might do in your shoes before getting worked up about something that hasn't happened yet:

I might reach out to the tenant via email, saying something to the effect of "I wanted to let you know that one of your references did not have positive things to say about you. I made the decision to lease to you based on trusting you and what you have told me, and I wanted to give you a chance despite not having a credit score. I'm not sure what happened between you and this prior landlord, but I hope that we can have a good relationship with each other as we move forward, out of respect for each other and our families who you and I work to put food on the table for. Please let me know your thoughts."

I have been able to save doomed situations in the past by humanizing issues and the real people whom it affects. Might be worth a shot. Plus, anything the tenant writes you back will be in writing (and by the way, don't communicate with your tenant at this point unless it's writing.)