All Forum Posts by: Brad S.

 If it's a legal duplex, it will be appraised as a duplex. If it's 2 attached sfr's (depends on the legal description and if they are on separate parcels-zero lo-line units, etc), then they are 2 separate properties, and will be appraised as such. Or, if it is a legal sfr with an accessory unit, it will be appraised as 1 property with an accessory unit.

FYI. - Here a is part of some new underwriting guidelines from an online lender I know of. Basically, just because it may not ding your credit, it’s still possible it may affect your borrowing power.

• “Applicants may not be under forbearance or deferment on any mortgage or consumer loan (excluding student loans) and must certify that they do not intend to request a forbearance or deferment.“

FYI. - Here a is part of some new underwriting guidelines from an online lender I know of. Basically, Although it may not ding your credit, it’s still possible it may affect your borrowing power.

• “Applicants may not be under forbearance or deferment on any mortgage or consumer loan (excluding student loans) and must certify that they do not intend to request a forbearance or deferment.“

@Eric Levy  

Great! Sounds like you may've picked a good area and I'm glad you are aware of the additional expenses. Good luck, I wish you well!

I'm assuming your mortgage payment includes taxes and insurance? But, I don't see separate line items for repairs and maintenance or vacancy and collections. Those items should be taken into account and will cut into your expected cashflow. Even if they don't rear their ugly head for a while, they can and many times will come around and eat up a significant part of your cashflow with an immediate vengeance.

I'd say your decision/s of what to do, depends on what your goals are. If your goal is to jump into the landlord business and get your feet wet, and you can afford the potential expenses and pitfalls which may come up, then maybe you want to keep it for a while. But, if your goal is to build capital, then you may want to decide if that property and area is a good bet.

But, one thing I don't hear many people post, is that this property can also be a liability weighing on you. I have had rentals which may have cashflowed in the short run, but caused me more headache and held me back from progressing toward my goals, due to the costs that came up (both actual costs and opportunity costs). I am convinced that having those properties kept me from better opportunities. 

I had properties for almost 20 years, that took a long time for me to get rid of and cost me money to sell. They cost me money to sell, since they needed work to get them in salable condition, and then sat vacant for months till they finally sold, while I had to pay all the carrying costs. And, because I didn't do good due diligence when I bought them, they sold at or below what I originally bought them for. Looking back, I would not have bought these properties, if I had to do it over again.  

I've had other properties over that same time period, which cashflowed about the same, but, made me good money when I needed to sell it. So, bottomline is, consider if that property is getting you closer to your goal, and if so, keep it, and if maybe not, consider selling it and getting prepared and ready for an opportunity that will.

@Andrey Y.

Appraisal - 

1. At that transaction amount ($90k), the "Appraiser" does not even need a license (transaction value below $250k), and therefore, would not be bound by the same standards as a licensed Appraiser. This is even more true for a non-federally regulated Lender.
2. Although it is unclear, I am assuming the condos they sold were all within the same project or neighboring projects. Contrary to some other comments, just because there are 2+ closed sales in the same complex/neighborhood, does not mean they are comparable transactions. The "Appraiser" should be able to discern those transactions involved the same Seller/Developer and therefore, may not represent typical market transactions. The Developer or investment group would not have the same motivation as a typical Seller, and therefore, those transactions may not represent "Market Value." This is why many Lender appraisal guidelines require a recent sale outside of the Subject's project and/or neighborhood (in new projects).

Anyway, unfortunately, since the Appraiser may not even be licensed, they also probably don't have any Errors & Omissions insurance to go after. 

Also, the Appraisal report is for the Lender, NOT the Buyer. It is for the Lender to assess their risk in the transaction, which is why they are listed as the client in the report, and the Buyer is listed as the Buyer/Borrower only. This is true UNLESS a Buyer specifically gets their own appraisal separate from the Lending process. Practically speaking you (Buyer) get a copy of the report and should be able to generally rely on it, since it should be an "objective" assessment of the property's value, but again, in this case, the Appraiser may not even be licensed.

But, I'd imagine all the parties still have a responsibility of disclosure, including whether they knowingly sold you the condo for more than it's worth. But, proving that is the challenging part, since they will defer to the Appraisal and not be willing to divulge that they knew it was overpriced, etc.

With all that said, I am not an attorney and you should never take any advice from a social media and/or message board website, without fully vetting it and discussing options with an attorney. But, it does sound like it may be worth finding an attorney local to the Subject, and consulting with them to see if there is any recourse. If there was a licensed someone involved (Broker/Agent, Appraiser, etc), maybe there is a better chance for some relatively quick and easy resolution.

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On another note:

I'm sorry this happened to you and you don't deserve this. No one deserves to be scammed and taken advantage in this way. There have been many people that have been scammed and deceived, even after doing all the proper due-diligence.

Now that said, you are responsible for your actions, decisions and the situation you are now in. I would take an in-depth look at that local market, either doing your own statistical research, or contact a few top agents and independent property managers in the area. Find out what the short and long-term prognosis is, regarding, ease of re-renting, market rents (including historical and future guesstimate), typical "rent ready" costs, potential future appreciation, etc. Look at the data, your cashflow, etc, and decide your next move based on this information. My basic point is you already made a decision based on little or no info, now is not the time to make another uninformed decision.

Most of us that have been in the RE investing world have made decisions, that in retrospect, we might've done differently. These are what helps us to grow ...hopefully.  ;)

Good Luck...

I need a stated income cash out loan program for a rental I have in TX. I have plenty of equity and will be around 60% ltv, but need to get some cash out for another project. And my self-employed income may make it challenging for a full doc loan. 

So, does anyone know of a lender that may have a stated income cash out program available?

Thank You

@Karen Chenaille

a quick google search came up with this:  https://www.proper.insure/

i would imagine you could find more. Also, you may want to call some of the short term rental property management companies and ask them for their recommendations. There are vacasa, manorshare, evolve, turnkey, to name a few.

Good luck!

Michael,

Thank you for your quick reply. There is a Spencers near this house and that was suggested by our property manager, so I'll check with them about floor models. I usually don't provide refrigerators on any my rentals in other areas, but the manager suggested it, so I was curious. But, we are in the $1,300/mth range, so it sounds like we don't need to provide a fridge. Thank You again.

Hi There,

We have a rental just become vacant and our property manager says we should change out the range and dishwasher and also provide a refrigerator. I was wondering if anyone knows of a place to find ""scratch and dent" appliances in the Avondale, AZ area, so we can get quality appliances for a good price.

Or, if anyone has any other advice to help us save money on the appliances.

Also, for those of you that are familiar with the local market, is it customary to provide a fridge as a Landlord? Although, we have had this rental for years, we are out of state Landlords and aren't "hands-on" familiar with this market.

Thank You