All Forum Posts by: Ronald Perich

You can, provided the SFH can be converted legally and would be suitable as a two family unit. Separate entrances, separate HVAC, separate utilities, etc. Usually too expensive for an existing SFH because it wasn't designed that way from the beginning.

Congrats!

I scan my signed leases and send them a copy of the scan. Also keep one with the PM software and one on my cloud drive. All dated. I believe i would be covered if they try a fast one. But I loved this story!

 He's not going to be liquid if he's holding a note. The zero% interest note would be very illiquid in my opinion. He could certainly get more by just selling the property outright for a discount. 

From an estate perspective, holding a note might be better. Not really sure on this one. The valuation of the note at zero percent might reduce the overall estate value which in turn reduces estate taxes. I'm not too familiar with estate tax laws to say for sure and don't really know his situation.

That would just be added to the reasons why the judge would grant for you as they've broken the lease as well. But this could also be a signal that they are finally giving in and vacating. Have you spoken with them on this? You should also check with Ameren and see if they've also ordered a shutoff of gas and electric. This could also be a nefarious action being taken by the tenant in a ploy to get the judge to side with them for an illegal shut off.

If you can, get the water company to provide you written proof that it was the tenant, and not you, that ordered the shut off. 

As for keeping it on and in the name of the LLC, you should keep the water turned on. Unfortunately for you, this could get really expensive depending on how vindictive the tenant is. All they have to do is turn on the faucet to the tub and let it run and you'll be looking at a lot of cost.

But imagine if they are still living there and they have no water. What happens to the *ahem* "waste" they generate? They could also call the building department and have the place condemned. That's just an additional hassle you do not need.

If they aren't moving out by Monday, make sure the water reading is taken when they transfer over to your name and that they are prepared to do another reading when you finally get the eviction finalized. Hopefully you'll be able to get the water costs as part of the judgement for you.

@Ryan BillingsleyWhen I was looking for my primary residence, we saw a true fixer-upper. It had an above-ground pool. My agent said something I won't forget. "Pools will eliminate 50% of the population right away. The next 25% will not care one way or the other. The last 25% will be really excited about it." An in-ground is a rarity in this area, so I imagine the last 25% will be even more excited about it.

That said, you have to really be cautious with an in-ground pool around this area of the country. If it hasn't been cared for correctly over the winter months can cause numerous problems. 

As for me, I would not keep a property with a pool for a rental. Liability aside, it's difficult to get tenants to mow grass - how easy will it be to get them to take care of the pool? Shut down in the winter and start-up in the spring will be costly. A SFH with a pool as a rental does not seem cost effective IMO.

To your continued success!

The seller should pay all of 2015 taxes since they owned. That's very standard practice during closings. I could see maybe not prorated for 2016 as a concession since we are only 1/6th of the way through the year. But if it takes until mid-April to close, different story. That's several thousands.

@Carolina E.

If the numbers make sense on paper, then the next thing you need to ask yourself is why the units are all vacant? 

Is it because they are trashed and un-rentable? Will $25K really be enough to get them into shape? Without knowing the particular building inspection authority, you really need to get a sense for what they are going to hone in on and what things like permits and inspections are going to cost. Perhaps reach out to a contractor familiar with the area.

What is the neighborhood like? Do you need body armor if entering after dusk? Will the quality of resident permit you to keep them occupied and full (and paying)?

You won't have to worry about appealing 2015 taxes (the seller should pay most of those at closing). Tax appeals are really helped by your closing documents. Just make sure you have those ready to go and to watch for notices from the treasurer. You have a very small window to do appeals if they don't automatically adjust them based on the sale price.

I use rentecdirect.com for my PM software, and it has an ACH process built in for an additional fee. Haven't used them for that yet. Cozy.co has a neat looking system but I haven't used.

I'm using Rentific.com for online collection. Seems to work OK, but takes a while for payments to clear.

Sorry to hear you're going through this @James Syed. The advice you've been given about needing an attorney is correct. You are not a lawyer and the LLC is considered an entity separate from you therefore you cannot represent that entity. I haven't done it myself, but one of the guys in the REIA we talked about did say he's done evictions by himself even though the property is in an LLC. Of course, most of the time the eviction never gets to the judge as he tries to find the evictee ahead of the scheduled court time and convince them to a settlement of some sort. And he says he's pretty successful with that approach.