All Forum Posts by: Russ B.

Not sure what the laws are in Sacramento, but I would start with a few general tips that are always helpful - keep anything you have in writing (especially your notice to vacate + any response, and any communication around the new tenant). For anything you don't, I would write down every detail you remember now. This way, there's not a question later on (ie, in court months from now) that maybe something happened that you just forgot.

The big question will probably be around whether the unit was ever actually vacated - is your old lease still active, or is this a new "lease" that they botched, or is it a squatter situation?

If your friend moved in while you were still there, or got the keys from you and moved in right after you left, then they can probably argue that "you" never moved out, but instead sublet the place without permission.

In this case, there's a good chance a judge will say that you do owe the rent (plus any damages), and it'll be on you to go sue the friend for it. 

This is where it would be great to be able to show that you gave back the keys on x date, did a walkthrough, got back your deposit, etc. If they found someone living there after all that and took their sweet time reacting, it would be on them. 

The other thing that may have happened, whether you owe the rent or not, is that you might have been named on your friend's eviction. If they're being evicted now, you might have a limited time to avoid getting an eviction on your background... probably worth asking a lawyer.

It's not that the deal itself is inherently scammy - it's that the one thing that would make any sophisticated seller run screaming, is typically the very reason why the buyer wants to do it this way (they don't have any money).

This is also the big difference between buying a business this way, and buying a house - the "why". In my case, the asset itself is on fire, and I'm putting it out (albeit from a safe distance). With granny's house, she's letting someone take control of a relatively safe asset, for the sole purpose of using in a dangerously overleveraged way. 

The tenant is technically right (even if they're being difficult) - you probably need a third electric meter or some kind of submeter. 

I can think of some ways to calculate how much of their electric the furnace has used based on the gas bill and some electrical testing, but nothing that quick or precise. 

In some states, you can't split up the utilities in any way that doesn't involve separate meters. In this case, they technically might be able to force you to make their rent include electric for the time the furnace was on their line.

If they're a new tenant, and you're in one of those states, I'd probably just eat the electric bill for the first month or whatever while it gets fixed.

You can totally rent to family as far as the IRS is concerned, and still treat it like a business. 

For tax purposes, you probably want the property to be treated as a "for profit" rental if possible, because the other alternative is that it's a "hobby", and you can't write off any losses.

One of the tests is that the rent has to be "reasonable" - it can be somewhat below market, but it can't be pennies on the dollar low. If he's not expected to be able to pay much (or regularly), you might find yourself in the latter category.

I don't know if you have an accountant now, but you probably do want to at least run it by one. Better to find out now, than after you already owe... 

As for a lease, I'd say you should have one even if you're going to charge very low rent - some kind of agreement that lays out the terms of your arrangement, that you would both stick to. Its main purpose would be to prevent (and minimize) potential conflicts as much as possible. Landlords and tenants get into it with each other all the time, so anything that can help reduce that risk would be a plus. 

Not exactly the same thing, but I've bought businesses (along with their real estate) in a way that's essentially a "subject to". 

In these deals, I'll take control of the asset right away (the owner appoints me and my partner(s) as managers), put out any major fires, and make some improvements, but I won't actually transfer anything into my own name until later, when things are stabilized.

I don't think there's anything inherently "slimy" about doing this, although there are definitely a lot of slimy things that people can do in these deals. There's also a certain amount of trust required, that the buyer can actually deliver. In this case, both sides at least have a lawyer though. 

Originally posted by @James Wise:

Originally posted by @Russ B.:

I'm still kinda surprised he managed to get someone from Wilmer Hale to take that turd of a case, given how well known their name is and the public exposure of getting smacked down + dismissed before it even starts. 

Riiiight. Clayton's supposed big shot attorney Louis W. Tompros even had some media coverage on the case. Jenna Greene, the so called "reporter" of the article linked below never contacted me for a comment on this story and I tweeted her a few times after they released it....Never heard a peep from her. Shortly thereafter they stopped with the press releases. I would assume because it didn't go down how they expected.

 Daily Dicta: Former ‘Fox & Friends’ Anchor Turned Real Estate Guru Turns Tables on Competitor

I'm sure the goal was never to win, but to get something (anything) out there to counter the video - try to claim that you're just some competitor who was spreading FUD about his operation, that he sued.

When the case gets dismissed 5 minutes in, the person he convinced (paid?) to write an article about it just goes silent.

This sort of gaslighting is a popular strategy that politicians (especially) and others will use, whenever they get caught doing something wrong. The point is to muddy the waters, so what was an open and shut case now looks complicated and hazy to the casual observer.

I'm still kinda surprised he managed to get someone from Wilmer Hale to take that turd of a case, given how well known their name is and the public exposure of getting smacked down + dismissed before it even starts. 

You should have evicted 2.5 months ago. Someone else can probably help with the exact process in PA, but it generally starts with someone (you in most places) posting a pay or quit notice on the door. The exact wording and length of time required varies by state.

Maybe an eviction lawyer / service would be a good choice this first time - then, you can watch what they do. They aren't all that expensive, and can also help with questions like whether you need to refill the oil (assuming it's in the lease). 

Alternatively, a PM might be a good idea. 

The last thing you want is to get stuck giving this person even more free rent because you did something improperly.

Pretty sure you can't ask what the disability is.. but you can ask for a doctor's note, and it should be from a doctor that's actually treating them (as opposed to one that just sells those notes online).

Petscreening seems like a good service.. but if you don't have to accept their ESA, why bother? 

I haven't used it in a rental, but one floor I really like is the floating stuff from Fusion. 

2/3 of my basement has their 12x24 "slate" tiles - they look nice, and whatever that surface is made out of is diamond hard. You need a new saw blade every 30 cuts or so - it'll start cutting really slow, and then you notice a smooth spot where the teeth are completely gone. 

I can't think of too many things a tenant could do that would hurt that stuff.. It's probably similar to the old asbestos tiles in terms of durability.