All Forum Posts by: Sylvia H.

My wife and I own a restaurant and we lease the building.  Our landlord just inherited the building from his dad that just recently passed away and he really doesn't want to be a landlord.  We are in a very small rural town and there are not any other options if we decide (or are forced) to leave.

Our landlord came to us last week and let us know that he wants to sell our building. Our lease is up for renewal and he was wanting to know if we would be interested in purchasing it. We said sure, how much are you thinking? He comes back with an asking price that is double the appraised value of the building. I asked why so high, and he said that a 'normal' person would only want to pay the appraised value, but since we have a revenue-producing business, we should pay more. His logic was that if we continue to lease at our current rate, we would pay more in 20 years' time versus just buying the building. I told him I am almost 50 and I am not sure I will be around in 20 years to realize the great savings that he is talking about.

Am I missing something? Should I pay more than the appraised value simply because my business is located in this building? He will eventually sell it to someone else, which is also a concern of ours. He put a clause in the new lease for a 60-day notice.  Meaning if he gets the building under contract for sale, he (or the new owner) can give us a 60-day notice to vacate the building.  Can we do anything now to protect ourselves from our next landlord?

Any and all advice is needed and certainly welcomed!

Thanks.

  Im getting an investment loan where the appraised rent amount must met or exceed the mortgage payment.  Long story short the first appraiser the lender used was horrible and gave a horrible appraisal amount of 30% lower than anything you can possibly get in literally anywhere in California (1 star yelp reviews across the board on how bad this guy is).  So now we are ordering up a second appraisal.  This time we want to take no chances and communicate with the appraiser before they come or when they arrive to do the appraisal.  

Any advice on how we should go about this?  We were thinking we have our agent relay some comps to the selling agent to give to the appraiser when he arrives or should we be a little more direct?

thanks 

 This is super common, we deal with this multiple times per year- you simply have someone who wants to get rid of a roommate. The short answer is that there is zero benefit to you, and you could very likely find yourself in court if you try to do this. There are two possible secenarios (but I'd reccomend you just tell the husband, "sorry, but nope.")

-Scenario 1: Wife wants off the lease: You could do this as a favor, but if the husband defaults, you can't go after the wife for rent, which benefits her, not you. 

-Scenario 2: She doesn't want off the lease: drop it there. She has the legal right to be on the lease and occupy the property when she wants and you have no legal reason to deny her that right. 

They are having a personal problem that has nothing to do with you or your lease. Don't make it your problem. I see this all of the time with self managers- getting roped in to personal drama and tenants wanting to use their landlord and their lease to exact revenge on their friends and family.  Just say no! 

No problem @Travis Felchlia.

Hey @Sylvia H. - Rent-to-own and seller financing are two different strategies.  

Rent to own = would be if you already own the property (typically single family house) and you rent it to a tenant with the option to purchase within a certain time frame.

Seller financing =  Acquisition strategy where the seller acts as the bank and you pay them a monthly payment and downpayment at specified terms to purchase the property.

@Luisa Trigo - We aren't too far from you in Missouri, just a little NE up in Chicago.   The answer to all your questions is yes, as long as the seller (and bank if in the picture) agree to the contract terms.

You can set up seller financing however you want actually which is why it is such a great creative strategy.  You can do seller financing with just the down payment and have traditional bank financing (more typical on commercial deals) the only speed bump is whether or not the BANK will allow it.  You can also set it up for interest only while you add value and then refinance.  Everything is negotiable. 

Sounds like you've answered your own question.  Besides, why renew a lease with a late-paying tenant??

Regarding possible eviction, you need to consult with an experienced eviction attorney now to prepare.

A word of advice:  Take the emotion out of it.  His circumstances are unfortunate, but they're not yours to consider.  This is business.  You're in business to make money with minimal headache.  He is no-longer an ideal tenant, move on to the next.

Hi BP pros,

Is it ok to let a renter rent my house if her credit score is 501?

I am new and starting my first rental property. Your response is much appreciated.

Sincerely,

Van