All Forum Posts by: Steve Combs

I'm in agreement with you. Even if they are in a new relationship, if he is moving in after 2 weeks, they had to have talked about it while she was looking. So, I wouldn't approve him and I wouldn't trust her. If she ends up terminating the lease, your better off.

I would still run a credit and background check. You can ask how she plans to support herslf if there is no job. You can do a six-month lease and ask her to re-apply to see what her finacials are like at that point.

Not sure of CA laws, but in NC long term leases need to be recorded with the county public records to be enforceable. Have you thought about buying out the tenant?

@Douglass Belt

 You can Google "Operating Agreements" to get some samples. But I would recommend having one prepared.

Items you want to consider are: what happens if your disagree on buying a property or on a aspect of a renovation or sales price, what happens if the project needs more money and one party can't or won't contribute, what happens if one party wants out mid-project, or one party makes a big decision without consulting the other party.

As stated above, you and the seller need to sign a contract, pick a closing attorney and a lender. 

Earnest money is a security for the seller. If they don't ask for it, I wouldn't offer it. But it does make you look like a more serious buyer if you have. If there is earnest money involved, let the attorney hold it not the seller.

The lender will coordinate anything they need to complete the loan process, such as a termite inspection or an appraisal. The attorney will reach out to HOA, if there is one, and the sellers mortgage company. But if you want any home inspection or repairs, it is up to you to coordinate those items.

Do your parents need the equity? Can they carry a second mortgage. The lowest transaction cost would be to leave the existing mortgage in place through either a sub2, wrap or lease option. You would just need to figure out how to pay the existing mortgage off and how to pay your parents their equity.

@Charley Park

 I wasn't sure from your post, but have you purchased your own home or are you renting? If you are renting, your first step would be to purchase a primary residence.

If you are looking for investment opportunities, you need to think about what is best for you. Do you want passive investments? Do you have the free time for a flip project? Are you good at project management? Do you enjoy networking and sales? Maybe wholesaling would be an option.

@Douglass Belt

 be sure to get everything in writing, including what to do when you disagree and create an exit strategy. I have seen many friendships destroyed by business deals. Invariably there will be times when you disagree and other times when one of you will feel taken advantage of. Keep things in perspective and remember your friendship is more important than money.

Your area may be different. But in NC, if they have any claims against you, they must file those with the court before the hearing in order for the judge to listen to them. If they go to court with a sob story about they don't have a place to go, it will not matter. All you need to do is show the judge a valid lease and that you demanded the rent in writing and they did not pay. 

Again in NC, if ordered to vacate the premises, they have 10 days to pay or appeal the decision. After the ten days, you can have the sheriff remove them from the property. 

Down here, if you accept any partial payment and/or payment plan and they don't follow through, you will have to start the process over.

Convincing your parents may be easier than you think, especially if they are paying for your student housing now. My son will be starting college in the fall. For student housing, his bill will be about $600 an month. A good 2 bedroom apartment off campus rents for around $700 a month. I could probably purchase a decent property for around $400 a month. 

So, if the year goes well and he goes back next year for his freshman year, I will be buying a place there, charging his roommates $300-$400 a month and he lives rent free.