All Forum Posts by: Steven Gesis

Welcome Shawn! We are turnkey operators in CLE outside of your immediate area, but, until I got into turnkey I was part of the rat-race and I am happy I got out and I have not looked back since. You will want to begin on BP and read as much as you can, do your homework build a strong team. Don't be afraid to make mistakes, but if you could find a mentor that has made the mistakes its a lit cheaper that way :)

 I think the most important element in this process if for you to keep the emotional element out of the equation and treat this as a business transaction 100%, everyone will be fine and everyone will continue to live together. This is the nature of a month to month, this is not your fault, these are the risks tenants incur when choosing to not secure a long term or timed contract, a month to month is what it is. Just think of the flip side, if the tenant who is month to month elected to leave you would have a vacancy join your hands, it is a 2-way street, at the end of the day you pay the bills. I do not think there is an easy way to approach this, I think you just need to pull the band-aide and call it a day. Change the locks when you move in, I suspect you have this planned out. 

A 60 day notice is ample warning and very courteous/generous, again the best advice I propose is keep it professional keep the emotion out of it and operate your business, grow your wealth and enjoy your new home:)

#TeamTurnkey

Matt, this is a very bold and blanketed statement, I think this is false, again just my opinion and being from Cleveland and doing/being apart of over 1,000+ deals in SFR Cleveland NE Ohio real estate, I will be the first to say, this can be as easy as any other city, the name of the game is building a good and competent team. Its not always about price, now, I do not play in the low end arena, however, I do play in the $75,000 begging range and cap out at about $1,500,000 for SFR, plenty of multi-family to work with as well. Cleveland is the epicenter for BioMedical Research and Development amongst many many many more things, with sophisticated arts that are world recognized to having all major sports teams except Hockey & Soccer, being positioned on one of the worlds largest fresh bodies of water.

I can say that head winds exist in every market, certainly plenty of competition all over the country. You mentioned some crime stats, there is crime everywhere it fluctuates in all areas every year some years more, some years less, I do not know if a single cit yin the country that is immune to crime.

Investing is risky no matter SFR, multi-family, commercial, flipping, holding, stock, bonds, IRA - this is the pure nature of investing it is a risk.

I am not trying to be controversial or pose an attack in any means, I am just saying, if you build a good team around you and you do your due diligence you can find a means of investing in any part of the country if you ave the financial means to do so and can capture the deal.

Happy Investing! #TeamTruneky

Great point! We work 95% of our deals in the suburbs, however we do find great asset talent in the City of Cleveland itself, we have some awesome neighborhoods that have took off and continue to rise at least they are certainly notable:

City of Cleveland Neighborhoods to Consider flips:

• Tremont
• Ohio City
• Gordon Square
• Battery Park
• Duck Island
• Cams Corner
• Midtown
• University Circle
• Little Italy

Their are several neighborhoods aforementioned that, are near impossible to even find something and when they do become available there is a very high demand and bidding wars ensue. I just had a very close friend shopping in Tremont, good luck if you can find something and if you do expect for it to be off the market same day or next.  Again, I am not saying this is the be all end all, Im just saying the City has some awesome opportunities itself. I failed to mention that our downtown living is currently booming and we cannot build enough units to accommodate the demand and rents are at 99% occupancy, with self service living along with full service concierge living. Cleveland is happening!

Suburbs are certainly a a necessary space to explore as I defined in the bringing they are th go to space for investing, but we do have more than just the suburbs. 

#TeamTurnkey

 Kyle, welcome to CLE! A beautiful and booming city, a city being reborn and redefined with new development spurring in nearly every corner of the city and surrounding areas. CLE is electric lately, it offers a unique investor position, you can define assets under $100k in suburban neighborhoods producing well over $1,000 month rent, I suppose it depends on your investment strategy. A good place to being when considering Cleveland, is breaking down your personal goals defining your financial structure and building a good foundation of team members you will be working with as you are situated outside of your immediate assets. A good management group will be critical in your exploration. Furthermore you will want to work with a qualified contractor.

Cleveland Construction/General Contracting: Ohio does not require contractors to have a licensee, you are susceptible to inexperienced and ill prepared contractors to handle your renovation whether it is a hold strategy or a flip strategy. You want someone who has experience in the immediate hyper local area to be able to define specific design criteria to match th neighborhoods. Some older established high end communities have boilers for example, ultimatley the transition is to to forced air however in some cases you may want tor retain the boiler system as it is a "lifestyle choice" in that area (this is merely one example). We can also discuss that in many of the NE Ohio suburbs we have a Point of  Sale (POS) municipal assumption violation list, this list must be assumed by the new owner that you will correct al the violations defined in that city report, you will need to place 150% of that repair violation list into escrow with the city, as you can see it is booming more and more complex. Understand and having established relationships in these various municipalities is critical, you want ot make sure you do not sign up for smoothing that is beyond the necessary actual repair, this happens n comes in to play.  the time, inspectors over state the condition of the problem and make you take extreme corrective measures that may not be necessary, this is where local contractor talent and reputation. I can go on and on about this, you can always PM me for more information and discuss these nuances that exist in this her local area. Been through so many of these variables int he area that no obstacle stands in the way any longer, just need to have the proper network in place.

Finally, you get what you pay for, always make sure your contractor is pulling permits, do not cut corners, Again, its about building a good team and get references check them out, ask to see portfolios of prior work. Most important ask if they work with investors and if they understand the needs of the investor and the timing constraints, the budgetary goals and the final outcome your seek to achieve. Build loyalty through transparency, this can be fruitful for many transactions not just one, forge relationships to be able to generate a system of success. 

Happy flipping! Welcome to CLE, if you are visiting anytime soon and want o grab a cup of coffee send me PM. 

#TeamTurnkey

Timothy, congratulations! It sounds like you are applying the ultimate house hack in this case and utilizing someones else money to get you in the home and renovated. Just note that although the streamline now renamed to 203k limited does allow you to borrow up to $35,000 for a renovation the following minimum conditions need to be met:

1. *No Chipping or Peeling Paint (Interior/Exterior)
2. *Must repair all health and safety concerns - utilities, major mechanicals, trip hazards, etc.
3. *Complete walls does not mean they all need to be painted and uniform, the just need to be repaired and areas of repair need to be primed. You can paint yourself - save big $ allocate to more important mechanicals.
4. *Bottom line everything needs to be operational and habitable free of defects. Don't to hung up on it, water you miss the appraiser will note and make your contractor add it to the scope as a stipulation to be able to close.

Now the mechanics of the $'s = $35,000 - 10% contingency - banking fess = $29,500 typically this is the upper limit of the actual contract of work you will be bale to get once you satisfy the other parameters of the money first, so do not count on the entire $35,000 for your renovation.

Contractors and Lenders - do a simple google search and the 1st page results should be able to land you both of your missing parts that can complete and execute your closing and renovation. This is a small marketplace, the good lenders know the good contractors. Do not look to pay nothing for your contractor as a sophisticated contractor is worth every dollar, they will close you the fastest and they will be able to actually deliver the job in a timely manner.  

Checkout some of my other posts through my profile about 203k, I talk alot about different rescues you can use to find contractors in your immediate area, you will want to really check it out. If you need additional rescues please PM me, I can send you some links and informational pages you can utilize to simplify your search.

Its super important you work with someone who knows what they are doing as this will enhance and improve your experience. This is not designed to be complex.

Lol, great point! You are absolutely correct the likely hood of this profile having all the ducks in order is probably a very slim chance.

 Awesome post! Nice  answer. Would you believe me that I got an email from a lender that will do a 550 credit score for this loan product, WOW! I could not believe it when I got it in my inbox. I think this is an outlier and I do not know all the details on it. I think your credit range is more accurate for the majority of lenders.

Correct, but, you can purchase a duplex, triple or quad and live in one unit and have the others be rentals with the 203k streamline/limited or the 203k full/standard. Finally, if all else fails you can get a conventional renovation loan the downpayment is more but no PMI, much looser requirements on the renovation as well. Food for thought.

Peyton, I cannot assist you in finding the property, however, I can give you some pointers about lenders, HUD Consultant and contractors.

The following will generally apply to your situation. A simple google search for a 203k lender in Marietta should garner some results for you on page 1, I would go with this approach as those lenders have a sophisticated enough ability to get themselves on page 1, then you can vet them based on some simple questions such as: how often do you write these loans? Have they been successful? Someone with ample experience is your best bet, because they already know the lay of the land for the paperwork and could give you the best advice and keep your loan moving. Finally, just like anything else you will shop lenders based on the incentives they can give you, closing cost fees, % APR interest, closing points, etc. Some lenders service their own loans others sell them to investors, this is really a mute point for the most part, the larger operations tend to service them in-house themselves and not resell them, this does not mean they are necessarily more reputable they are just larger.

You need to determine how much construction money you think you will be aiming for once you define your property. Not every lender who does 203k does Full/Standard if you need more than $35,000.00. Keep this in mind so you do not waste to much time. If you do need more than $35,000 then you need to a HUD Consultant, feasibility report and scope of work.

Contractor, I think this applies more here then the lender, again, a simple google search will produce some page 1 results, these contractors tend to be more sophisticated and you can ask them a series of questions just like anyone else and vet them diligently. Finally an experienced 203k contractor will be able to get you processed and closed significantly faster, as they are equipped to handle the administrative burden set by the lender:

• Registration, Bonding & Permitting
• Proper Estimate Structure
• W-9
• Insurance & Workers Comp.
• EPA Certification
• Financial Capacity
• References & Past Performance
• ...... much more... varies by lender

I hope this helps a little, feel free to inquire more.