All Forum Posts by: Steve Babiak

He's got a 6.8% commercial loan on that; he's not going to be lucky enough to get better financing than that at this point (from a recent commercial loan presentation I attended, that was at the lower end of rates for my area).

Looks like other posts are spot on - he paid too much, and if he can find an investor to buy it on a short sale, that might be his best way out.

Not only should you give them each an application, you should qualify each of them "by themselves". Roommates tend to get into disputes, and one moves out - leaving the other behind. No matter which one gets left behind, you want that person to be able to afford the rent on their own.

Rich,
I don't have too much more of a clue about the scoring system either. Maybe Josh can help us to understand a bit better.

One thing I do: I will press the little + symbol on a post that I like, and that makes good sense and isn't just BS. I think that does help boost influence.

BTW - I finished the Edelman book you recommeded; good reading there. Now I'm looking for some more reading material (hint)...

At a presentation given at my REIA last year, the speaker said bankrupts fall back into foreclosure at a rate of 80% of cases. You want the ones that get dismissed; the ones that get discharged are in that 20% who solve the problem by paying things off.

Check back on the houses you are following in several months; if they are back up for foreclosure sale, then you have some very motivated sellers.

Dismissal explained:
http://www.totalbankruptcy.com/news/articles/how-to/dismissed-vs-discharged-debt.aspx

Not only is Rich correct on this, it is a really straightforward to do.

As your tenant/occupant/resident makes payments that you then use to apply toward your mortgage, eventually you will gain equity by having the lower loan balance. You can then leverage that built-up equity via second mortgage or line-of-credit secured by that added equity. That levered money gets you into the next property. Repeat same process.

So do both.

Whenever there are multiple names owning the deed, you will need to get all of them to agree to sell their portion. This could be easy if all of them just want dollars; this could be a challenge if somebody is sentimental and emotional about the memories in the house. You should find out to what extent the other eight might be motivated to sell, otherwise you could put in lots of effort for a non-candidate house.

Regarding question 1: Get a partnership (and operating) agreement in place, defining every detail in advance (as much as possible at least). Once underway, disputes may arise, and your agreements will be the governing documents that determine the resolution to those disputes.

Re question 4: University students as a group can be very "hard" on rental property. Set specific qualifying criteria for them so that you get the cream of the crop; graduate students, medical students (not just pre-med, but in the med school), law students (again, not pre-law) - these are the students moving toward a bigger payday ahead of them, and they spend more effort on studies than the partying.

Also, get yourself a landlord friendly lease that complies with your local laws, and that includes specifics for college students. Understand how to have all of the college students get their lease co-signed by parents (preferably real estate owners) so that you have those co-signers to pursue for any non-payments and damages. And if those parents own real estate upon which a lien may be levied... you will have a better position of strength. If you can, find out how the real estate is owned so that you get all parties listed on the deed as co-signers.

I read Scott's post a bit differently. I guess.

I think Scott is trying to say that the fact that you aren't directly buying the property is being detected by the seller, and that the seller is jumping to the assumption that you have some objection to the seller's property - otherwise you would buy it yourself.

So, if you don't have any such objections, then that seller won't go that way either.

For a list of dogs that are considered vicious, see my reply in the related thread about dogs in a rental:
http://www.biggerpockets.com/forums/52-rental-property-questions-landlording-issues/topics/33749-dogs-in-the-rental-apt