All Forum Posts by: Tal Eisenberg

Another concern I have and maybe this is getting ahead of myself but if we do win the auction how do I go about with the current tenants.

It is a 6 unit building - not all the apartments are occupied.

1) If the current landlord has security deposits from them, does he hand them over to me?

2) If the current tenants do not have security deposits, can I force them to give me a deposit before their lease is over?

3) Do I have to wait for their lease to be over to try to get rid of them? I just prefer to put my own tenants in there...

4) If there is a tenant in there that hasn't been paying rent, can I start eviction process ASAP?

5) If I can't get current leases from the owner can I get a copy from the current tenants?

Anything else I should I know HIGHLY appreciated...

Most of it makes sense...I think the only question I have here is how did you get to a $465k mortgage with the $100 a door rule?

I have my title rep doing another search for me. Everywhere I have looked points to no Fed Tax Lien. We shall see if I'm right

This is definitely a first lien. I've triple confirmed through the broker, on my own & the county clerk.

I've been trying to find out if there is an IRS lien. My title guy just txted me there is none on there, but he also is under the impression the referee needs to notify of all liens prior to auction....?

This requires local knowledge of that area and the practices there. But I would imagine that title can change hands without taxes being paid in full; when those taxes go unpaid, the taxing authority then has the ability to take the property through some type of foreclosure process. In my area, when I buy at sheriff sale, I expect that there will be delinquent taxes I pay after the deed is recorded. That might also be the case where you are looking.

I've been reading a lot of everyone's post. Learning more and more!

Thanks everyone!

My range of rents is actually $1,250-$1,350. I did lower the range a little bit because it is a rent stabilized building and although those range of rents fall within the rent stabilization law, I wanted to be conservative with a lower number. My real expectation is within the $1,250-$1,350 range.

They way I have broken down the expenses is:
$3200 for taxes
$3000 for insurance
$3000 for heat and hot water
$3000 for incidentals/upkeep/etc.

We are not using a management company. Trash is taken care of by the city. The units are individually metered.

So let's say I go with a more realistic rent of $1250 a month leaving me with $15,252 yearly cash return. After that you lost me a little bit. We will probably be taking a loan out, but there's a chance we may paying all cash too. It depends on a second partner that may be involved.

Isom - I happened upon this auction from a friend. But the local newspapers always have notices of auction in them. Plus I will probably be subscribing to property shark in the near future.

Jake - I will be reading this later today. I'm sure I will have more questions too. I thought the 3 day turn around sounded off, considering I was able to do the search myself. Im waiting to hear back from another Rep, see what she says.

Is flippingriverside your blog? I've been in touch with the Title Rep from my class and he said it would take him 3-4 days to do comprehensive search. He point me to ACRIS, which I mentioned before, and showed me where to search for Federal Tax Liens, none of which I found. I suspect I will have him and looking to find another Rep in the meantime.

Thanks Jake. The auction has been postponed once already. It was first scheduled in February of this year. If it gets postponed there should be other properties going up for auction and will be a good experience for us nonetheless. I don't have a relationship with a title company but do have someone I took a class with who works for First American Title Insurance Company. Maybe I will ask him....

Also, would like to know what you guys think should be the high bid on the place. It is a 6 unit building - going rents in the neighborhood are $1,000-$1,400. That brings gross income to $72,000 - $100,800. Annual taxes are $3,200. We estimate yearly expenses to be about another $10,000. Improvements to the building could be anywhere from $35,000-$100,000.

The amount owed on the mortgage is ~$260,000 + fees & interest. My guess is the bidding will start around $300,000.

With a conservative net cash flow of $59,000 and conservative improvement expenditure of $100,000 I think our cap should be at $450,000. That brings total cost to $550,000 bringing a net ROI of 10.7% annually....thoughts?

Hi All,

First post (besides introduction) for me. My father and I will be going to our first auction as bidders this Friday (in Queens, NY). We have scouted the property numerous times, actually been inside the building (not any of the apartments) and have decided to bid on the property. Property taxes are all up to date. I have called the county clerk and they told me there are no liens on the property except for the foreclosure.

I know that at a foreclosure auction everything is expunged except for taxes. There is a broker representing the note holder and he has told me that he believes that title can not change hands if there is an existing tax lien. Is this true?

I've looked on ACRIS (The Automated City Register Information System) and see no record of any open tax liens on the property (county, state or federal). Is there any other place I should look? I have until Friday morning.

I know this is last minute to post for this kind of thing, but I've only recently found this amazing website. I will be coming on here more and more for future investments, questions, etc.

Thanks in advance

Tal

Hi All,

My name is Tal Eisenberg. I am a Real Estate Broker in NYS. For the last 7 years I've been mainly renting apartments to people and have recently decided to move on to investing. I am also in the process of opening up a property management company with a partner. My goal is to purchase 1-2 buildings a year for the next few years, specifically distressed (REO, short sale and foreclosure auction). Hope to discuss with and learn from a lot of you hear.

Best,

Tal