All Forum Posts by: Paul M.

The hyper heat ones are supposed to be able to handle very low temperatures.   And it is possible some models have an electric backup.   Plus you will get AC with it.   In general the ductless units are very low maintenance, efficient and growth in installations is explosive.   Though powered by electric, the heat pump technology means they are very efficient compared to electric heat and maybe gas heat too.   Plus environmentally speaking, it is good to start transitioning away from natural gas.

Allocating not based on actual usage is going to lead to fairness issues and conflict (and is often not legal).   Unless you can't actually separate it would be better to just charge more rent.   Presumably the market rent for utilities included is higher (though I realize from experience tenant shoppers don't fully take that into account, may not know how much value that is, and often just looking at the price first when screening apartments)

If for owner occupied then go with a local bank.  If inv property not as many offering.  Bank of Canton and Century Bank do.  Your experience with appraiser seems very rare.  Unless there are no 2 families in your town.

"They will care" doesn't seem to translate them into making changes to their ratio requirements. I could have W2 income equal to 5 times the loan payment and the DSCR will remain at 1.2-1.25. That's what I'm seeing so far.

I'm learning about/shopping for financing for 5+ unit residential properties, after having only owned 2-3 unit buildings. I'm finding that the banks only care about the property itself supporting the loan, even though they are not non recourse loans. Having a high income or net worth ("global factors") doesn't seem to factor in (I imagine it would factor in if personal finances were negative though!). In the 2-3 unit world it was always the combined finances that fed into a debt to income ratio and that was the hurdle. The rent to market value ratio is weak on some properties in my area so it seems to meet the 1.2-1.25 DSCR I've usually been quoted I have to put down 40%. (I realize that I could go to another area with more favorable cap rates etc, but I don't wish to do that for various reasons beyond the scope of this post)

My question is if I keep shopping will I find a bank that will lend at a weak DSCR based on my global finances or are property finances always all that matters? I have been talking with local banks. I spoke with one national bank and that was a waste of time (they required 1.5 DSCR and 50% LTV)

So we are sure that depreciation taken in the past is taxed at 25%, not ordinary income tax rates?   Where does the ordinary income tax rumor, if it is that, come from?   Are there other types of assets where depreciation recapture is taxed that way?   It is definitely something I've seen in my life, somewhere...

 Which services involve me being able to delete people's accounts?   Obviously not Zelle or Venmo.  

I don't use one, it would be more work to supervise them, fix the mistakes caused by the fact that they just don't know all the facts as well as me or are too busy, inputted data wrong etc.   I also like that with turbotax I can prepare the return look at it, then make changes easily, all in one sitting.   Rental property tax law at my level is not that complicated.   It helps that I have an accounting degree and am an accountant myself, (but not a tax accountant), so I know what I know and what I don't know.    I have worked for other real estate professionals and as the financial accountant on staff have liasoned with the external tax accountant CPA and while I felt they were great for those businesses never felt like they would have added value for my own, smaller, simpler rental property business.    It is also a matter of meeting the right person (tax accountant) and someday if I do I may change!

My research so far has failed to uncover an electronic rent collection service where I have the ability to reject/stop unwanted payments.  EG to prevent tenant from extending an eviction process, extending a month to month agreement etc.   I would be willing to do some sort of quickbooks type thing where they can only pay for an open invoice, but they'd have to be able to pay by bank draft not credit card.  

Does anyone collect rent electronically and do you just live with the legal risk it entails if you get into a conflict situation?

Is there a way to avoid the tenant forcing a payment on you (eg to avoid an eviction)