All Forum Posts by: Phillip Gainey

Curt,

PLEEEEAAAAASE!

YOU WERE THE ONE WHO RECOMMENDED THIS PM!! Ryan Lubin! You sold this property to the owner (who wants to remain anonymous) in 2009 when at Investor Nation! GEEZ O FREAKING PETE as we say in Michigan!

You guys ought to start a comedy show or something! You could call it "Memphis Deadbeats". You could schedule it right after "Policewomen of Memphis".

This is like dealing with traveling gypsies or something! You all know each other!

Kick over a few rocks and all kinds of things come crawling out! :-)

Time for Ryan H to chime in!!

Come on people, this is San Francisco. Right?

PG

Not informing the owner of damage to the property is unsat. According to the owner, he did a google search of the wife (not put on lease), found the shelby county court website. Saw she had 5 eviction judgements against her in a 14 month period. The owner called this pm and he tried to act dumb like he didn't know who was who.

Invest in your own area. If you do invest out of area, deal with someone you really, really trust. Join the local REIA. Get to know people.

I am moving more towards investing in paper not properties. I want to be able to drive by and see that a freaking garage door has been backed into! n The sooner you catch a pm in a lie, or withholding info, the better.

I wonder why he tried to talk the owner into keeping these tenants?

PG

The PM they recommended turned out to be a real zero:

1. Put a tenant in a nicer property with 4 eviction court appearances in one year. Actually, that was the wife who they snuck in under the radar. She never got put on the lease.

2. They had to eviction court twice in 4 months. Finally had to be evict them.

3. Despite the above, the pm tried to talk the owner into letring them stay!

4. This property is now on the 5th month with no rent coming in. Not good for CF!

5. PM they recommended was fired, then found out from the new pm that:

a) There was a roof leak he didn't tell inform the owner about. That's why tenants weren't paying the rent (so they say)!

b) The tenants backed the car into the garage door causing hundreds to fix. The pm they recommened didn't bother to tell the owner.

5. The owner told the pm he was thinking of dumping this headache they sold him. He passes this on to Investor Nation and they send an email to the owner a couple days later offering to help them sell it! Tried to make it sound like they wanted to help him. So they sell him a property, recommend a ZERO pm, turns out to be a mess and they are ready to dump and they TRY TO MAKE A LITTLE BACK END PROFIT! Precious!

Here me now, and believe me later. Avoid these guys. Join a LOCAL REI club! Get to know OTHER INVESTORS who know the area and aren't just trying to make money off you.

PG

Indiana seems to meet much of your criterea. Defitely low property taxes. I pay really low taxes on my properties there. As for cities, I avoid the larger urban counties and municipalities. Not trying to start a political debate, but i like red versus blue. Mishawaka or Goshen, versus South Bend, for example.

PG

James,

I'm on my third PM. I am hoping three is a charm.

PG

It was fairly cut and dried. The lawyer who had drawn up the DOT and promissory note handled it. It took one month. I had to pay the back taxes. The lying dirt bag (nautical term) I loaned to wouldn't pay the taxes due. Claimed he didn't have to. So I had to pay them,around 1k, and $800 bucks in legal fees. Both he and the mortgage broker who introduced me to him are on BP. Do your due diligence!!

Anyway, deed got recorded to me. The whole process took around a month. Sold the property on CL. The magic words turned out to be "Seller Financing". Time will tell if this turns out.

Lesson learned is to do biz ONLY with people who have a proven track record. Who say what they will do, and do what they say. When you find them, STICK WITH THEM! Be on the look out for any kind of dishonesty or deception. Go with our gut!

PG

I've grown my SDIRA at close to a 20% rate, passively by financing deals for investors. People who know their area, have a track record, actually make the payments and do the deals. No tenant, deadbeats, or eviction queens. No PMs to deal with. I've only had to take back one property out of around 10 loans. Just sold that property offering seller financing.

Now buying discounted notes. Just bought one with face amount of 40k with 8 month seasoning, for 24k in Detroit Metro. 10% coupon, 8 years to maturity. My yield is around 16%. Gonna collect on it for a while then maybe sell for a profit. Again, compared to rentals, fewer "moving parts" and people to trust or depend on. Still have to do due diligence.

When the economy turns around I will turn to investing for appreciation in traditional appreciation type markets. California, Hawaii, Seattle...etc.

A time for every season, turn turn turn.

That's kind of a fallacy of composition. Finding and dealing with a PM is an integral part of RE investing. It IS an investing problem. Especially if you invest out of state.

Tenant problems are not just a PM problem, but also an INVESTING problem.

Property manager management, and tenant management are "subsets" of RE investing.

Tenants are the most important part of the equation. If tenants don't pay, pay late..etc. the house of cards comes crashing down.

I just love it when property sellers (wholesalers, turnkey vendors...etc.) pass the buck on to PMs. Especially when they were the one's claiming such and such a neighborhood is such a "great rental area". And THEY recommended the freaking PM in the first place!

Then, the PMs pass the buck on to the tenants. "Ah, the tenants here in Memphis are a real challenge. It's hard to find an applicant without at least ONE financial judgement against them. Blah! Blah! Blah!"

Pg

People asked me to explain myself, I did.

Here to be fair, I'll point out another vendor. A couple years ago when shopping around, a San Diego based vendor, Meridian Pacific, was trying to pawn off a run of the mill 3/2 on Winterpark Dr (38141) for $100k!!! Market rent was around 1000. Outrageous!

There is a HUGE out of state investor interest in Memphis. Companies are out there to capitalize on it. Fair enough. But I don't get this "Hey your're not buying! Nobody's put a gun to anyone's head! What's you're problem buddy!"...etc. mentality on a RE investor board.

CAVEAT EMPTor