All Forum Posts by: Pat Jackson

I know this question has been asked before. I'm convinced it's worth it.  Here are my questions.

When adding coin laundry to small multis (I'm really talking 4-plexes), how is:

1. Rentability impacted? I know I wouldn't want to live some place where I had to drive to do laundry.  Honestly I don't want to live anywhere that doesn't have laundry in the unit, but I've never lived in a multi unit.
2. Does anyone believe this justifies raising rents?  I'm not trying to squeeze blood out of a turnip, I'm thinking $10-$15 a month a unit.
3. I have heard of companies that install their units and maintain them.  The utilities are up to the owner, and once a month they receive a check for part of the funds.  Does anyone have such a company they recommend, especially in the Kansas City area?  I've heard they exist but can't seem to find them online.  Perhaps I'm not doing the proper word search.

I sort of did this.  We bought a 2017 Subaru Forester, 0% financing for 48 months.  Then I sold an older vehicle.  Gave us cash, dinged my debt to income ratio.  Have you thought about that?

An update. The tenant is real. He’s been getting ripped off by whoever lost the house. He has been paying rent to whoever lost the house. I assume that’s not super uncommon. He wants to buy the place, the REO company has given him a week to secure funds. If he doesnt, then they will accept my offer. Gives my realtor and contractor a week to get into all 3 units and see what the story is. Will post how it goes!

To clarify, I'm not in this position, but wish I was!

Let's pretend someone financed a 150,000 house with an FHA loan. After 3 years they owe ~147,000 and the house has appreciated to 300,000. Now let's say this person inherits, makes, finds, etc 147,000 and they want to make the most out of it.

They could:

1. Keep paying their mortgage for another 27 years, or until they move and invest the 147,000 in real estate.
2. Pay off their mortgage and take out a HELOC. Some banks will loan up to 90% LTV. PenFed will loan up to 85% LTV and require interest only payments for 10 years. This person will now have a line of credit for $255,000 and won't be paying a mortgage.

Seems like a good idea to me.  Worth it?

Originally posted by @John Ching:

Looks like some pretty good advice given so far. But I'd like to know more details. 

Where in MO is the property located? What sort of "deal" do you think you are getting? Did you take into account eviction/rehabbing/property management fees when doing your property analysis?

Stepping right into an eviction/REO is not something everyone is willing to take on. There is much more low-hanging fruit to pick.

It's in Saint Joseph. Each unit would likely rent for $600-$650 a month, and all in I believe purchase and rehab could be done for $100,000. The numbers work out really well, at least on the surface.I was really heavy handed on the repairs since my contractor hasn't been able to get inside. I suppose the risk is, upon buying the place, they're so far gone they'd have to be knocked down. I guess that's a risk with any REO you can't see before you buy.

Much appreciated. I like the idea of passing this up, on the other hand I’m ok with babysitting it 6-9 months if the end result is 3 well rehabbed cashing flowing units.

I'm considering buying a "triplex" (its really a duplex and a SFR on the same lot" It's in a C+ neighborhood. Fixed up it would cash flow very well. It's located in Missouri, and is an REO. It's on the MLS

My realtor (I live in Nevada, so this is long distance) went by, the downstairs unit has a tenant that claims to have been paying rent to the owner, unassumingly to whoever lost the house. The upstairs unit has been gutted and isn't inhabitable, and the SFR out back has squatters.

I'm likely just going to run away from this deal. However I'm curious how easy it is to evict people in Missouri.  I'm mainly interested in the situation with the owner losing the house and the tenant who claims to have been paying rent.  If that's actually the case, what rights do they have?  

Anyone think this tunnel could have light at the end, or just run away?

Originally posted by @Caleb Heimsoth:

I believe so, although not an attorney. There’s an attorney named Scott Smith I believe, who was a guest in the BP podcast who talks about this.

For 3k he will set it up and put each property in a series LLC and then it's 300 bucks for each property after.

No legal advice given

 He's who I'm using.  And its 5k now.

I had forgotten about the owning the property in the trust.  

Can one get financing on a property through a trust?  That would be easier :)

I know this is talked about a lot, my question is a little different.

I'm in the process of setting up a Series LLC to protect myself. I'm working with a particular lender that is very investor friendly. I'm preapproved, and discussed my plans of buying up to 10 1-4 unit properties. According to them, my w2 income, credit score, and DTI are all good to go. After owning a property for 1-2 months and having it rented, they'll use rent check receipts as income and allow me to have another mortgage. The paperwork is a little more complicated, but you get the gist.

I'm planning on financing these in my own name, the moving them over to the LLC. I'm not worried about them calling the "due on sale" clause. What I am worried about is after I finance a property and move it over to the LLC, then go to do it again, they'll be like "hey, no more mortgages for you since you're going to keep transferring them to the LLC". And I don't want to ask the lender for fear they won't issue me a mortgage at all (maybe that's a bit extreme).

In short, does anyone have an opinion or experience on what lenders will do if you continue to use them but are constantly moving properties out of your name into a LLC?