All Forum Posts by: Todd Pultz

@Jimmy Lieu a lot of conventional lenders will count your rental income. All have similar requirements for seasoning, but the standard rule of thumb is that you can count 75% of your gross rental income to offset your debt. Usually you are required to produce current leases to justify your statements and some want to see P&L

I always have DTI issues due to real estate being a large part of my income. However, I keep diligent books, current leases and I never have an issue with lenders.

@Jake Garrity great write up and congratulations on the success! Keep that momentum rolling.

I would suggest using a software like househacker Pro or something similar to do your scope of work. I can’t help but to think how much of a grand slam this would have been if you could have pinned down the demo and electric costs. Those number sound outrageous to me for Ohio. I’m in Dayton, but our contractor prices are not much different. To rewire a quad from scratch including main service we usually get in and out for under 12k. To demo a duplex to studs we can usually get it done for under 6k. It is hard to find good contractors that will be reliable. Start building if a solid team in Cincy so you can get those cost down!

Great job on your first brrrrrr. Anything I can help you with Ohio, let me know!

@Brady Aman nothing new, here in Ohio we have been competing with out of state money consistently since about 2010 or so! Inventory is down right now, but being local give you the off market advantage so you have to use it.

I actually met one of my partners through out of state money. He was investing and bought a property from me and a bunch of others, but started losing quickly and having issues with PM’s. I stepped in to help, turned it around and we started partnering on deals and are great friends now!

@Collin H. I could not agree with you more on insurance! Actually, I was shocked when I started reading on BP that anyone with any kind of rental had a homeowners policy oppose to commercial!

You have some real experiences on why it’s important. I had 1.1 million in damages during a tornado last year and the coverages and extras my commercial policy provided were phenomenal!

If you do any kind of rental, get a COMMERCIAL POLICY!

One last advantage that I love, when I buy a new property Which is often, I send an email to my agent and shoots back a conformation within a few hours that he bound coverage on my new property with my commercial policy! Simple.

@Jack Norris your question is not diffrent than many new investors and always hard to determine at first.

It really depends on how much cash you have and where you plan to invest! Let me give you a great easy example......this is less risky. I use the brrrrr in most of what I do and long before it was a fad lol. But here’s a path I take new investors down in my area that don’t want rehab and want less risk.

If you had 100k cash to invest in my area, we can buy cash flowing 4 units 80-100k all day long. I have several lenders that will lend 80% of purchase price to new investors on these. These properties easily cash flow 1200-1300 monthly. So with your 100k, we could scoop up 4 of the properties easy and you would be cash flowing 4K minimum monthly. The after collecting rent for 1.5 months, we would buy your 5th same scenario and now your cash flow is 5-5500 monthly! Not bad right? Very doable in certain markets.

These markets where this is possible is also harder to pull off a great brrrr on these buildings and you have to go to larger buildings to see the rewards in refinance that others see in other areas of the country by buying distressed.

My point, figure out your tolerance level, make relationships with lenders(I have several I can share), hook up with a great investment minded realtor and get rolling! Best of luck to you

@Bryan Noth I think your question was missing a very important piece of due diligence. You can not simply ask if you would rather have tenants or be vacant. While doing due diligence it is very important that you inspect each lease to understand the terms, deposits and end dates of each tenant so you understand what your actually inheriting. This also can affect your offer on the property.

Example, recently we acquired a 21 unit and the rents were $125-$150 below market rent. Great opportunity right????? WRONG! The seller had given 12 of the tenants a “sweetheart” lease for 24 months and they all had 22 months left on them. In Ohio when you buy the property, you buy the lease! So, we actually negotiated an additional amount off the purchase price due to this!

While your question had good intent, it did not contain enough content for anyone to make an informed decision.

@Melanie Stephens I have so many stories, but here recently I took a tenant in on subsidy and she somehow associates me with her father. Every Sunday morning I get a phone call at 7:15 where she wants to tell me a bible verse. Always different, but it makes her feel better if I listen. With hundreds of tenants I’m lucky this is the one lol

@Erin Snow welcome aboard! I’m here in Dayton, OH if you need anything at all. Best of luck in Denver

@Jill F. Completely understand, but as a new investor becomes bigger with more doors they have to be educated with fair housing and their state housing laws. You need to have a valid reason to turn down someone or they could call discrimination for about anything. I’ve personally been there myself as a landlord for something I did not even consider.

There are ways to always have control of that though.....make your income requirements higher than most would be able to qualify, require certain number of references etc. all kinds of ways to skin a cat, but you have to do it legally.

I don’t think his situation applies under fair housing, but new landlords need to be cautious and under the laws that govern us

@Kyle Barger completely ignore those traffic violations. I could give you list of famous people, millionaires, well know investors and others that have way more than a few traffic violations. I wish that’s all some of my tenants came with.

The Facebook is on you and how you feel in your gut, but I would not push him away because he has political beliefs!

With that said, I would read up on the Fair Housing Laws and your state laws regarding what you can turn someone down for.

With this, as long as you didn’t list with a broker and you don’t own more than 3 homes, fair housing does not apply to you