All Forum Posts by: Tommy F.

@Jack Paradowski 

As far as I know, renting to parents does not have state specific restrictions and I have no reason to suspect Virginia is any different. The Family Opportunity Mortgage is a Fannie Mae loan product, it's 100% legitimate, simply ask your mortgage broker. A Family Opportunity Mortgage is primarily for (a) Parents seeking off-campus housing for their child in college, (b) Adults seeking to purchase property for their elderly parents, (c) Individuals seeking a residence for an immediate family member who is unable to do so on their own. It provides the opportunity to purchase an investment property at a lower interest rate than commonly available while providing a home for an immediate family member. Since you're the parent, obviously you'll need a child to work through the scenario described in this thread of posts. I'm not an attorney nor a CPA, so seek professional guidance.   All the best!

@Trevor S Foster Upper Marlboro is a small town so you should be able to go into the Planning Dept and speak to someone about zoning and how to apply for a change - it's probably a very small department. Five acres is not something that's going to get developers and investors excited unless you have something unique about the 5 acres, i.e. ocean front. Your description of the land makes it appear to be in a rural area. Does it have public sewer? If not, you need the soil perc tested - somebody has to pay for it, you or buyer and delaying this step will only drag out your plans. Assuming the soils are good, you'll likely need one acre per house for waste water disposal and repair area - this is a health department hurdle. You can shoot for ultimate zoning density, but if you have no way to flush the toilets you're dead in the water, no pun intended. Does the land have access to county water? If not, you need to dig wells and if you have wells and septic...you need more land per house which may be the reason it's zoned in it's current state. A quick look at PG County website and it appears that wells and septic systems are prevalent.

http://www.princegeorgescountymd.gov/2133/Wells-Sewage-Disposal-Systems

Wells & Sewage Disposal Systems

Services

Prince George's County Health Department provides several services to residents as part of the Environmental Engineering Program, including:

Percolation tests to determine the suitability of soils for individual sewage disposal systems (See our Percolation Test Application (PDF).)

Review of septic system plans and issue Septic System Permits for the replacement of failing septic systems (See our Septic System Design Manual (PDF), for review and permitting of conventional septic systems for new construction.)

Site evaluations for replacement wells

Well Permits

Inspection of well and septic system construction in existing homes

Disbursement of funds from the State's Chesapeake Bay Restoration Fund for the installation of Best Available Technology (BAT) nitrogen-reducing septic tanks or connection to the public sewer. (Download the Bay Restoration Fund (PDF) application form.)

Oversight for backfilling of abandoned wells

Review and approval of subdivision plats to be served by individual wells and/or septic systems

Site evaluations for the potential installation of Innovative and Alternative (I&A) Septic Systems where conventional septic systems will not work

@Trevor S Foster Is this a project for you to get your feet wet in land development (OJT) and make money for yourself or make money for your mother? Why would she need to give you power-of-attorney or have a contract? It's her land. If she wants you to find a way to improve the value, you can do it without a POA or contract, just do it out of the goodness of your heart, and explain it to her along the way, and then she signs-off on anything needing her approval.

Are there ways to increase property value? Yes.

1) Rezoning for greater density. Go to county website and learn about the rezoning process and be prepared for a potentially long process depending on the current zoning and surrounding area. It can be daunting in some areas for the uninitiated.

2) Is there public sewer nearby? If not, get perc tests done on the land and have a civil engineer sketch lots for you based on potential rezoning or lot(s) based on existing zoning. This is a due diligence box to check for a buyer anyway, get it done in advance. Could cost up to $4k to $5k.

3) Trees can be a blessing and a curse. With 5 acres, there's not likely to be a big appeal to a timber company for such a small haul. Go to your State University's forestry department for guidance. Depending on zoning ordinance there may be "tree save" requirements for certain tree sizes which can complicate things. Trees can possibly help value when coupled with advanced septic systems (not traditional septic) because trees will take up large quantities of effluent. If public sewer is available and ordinance requires tree save areas, you may be better-off clear-cutting to avoid red tape. Do your homework on this one.

4) Your lumber company connections probably won't be helpful unless you're building a house for yourself. A builder will not have the time, patience, or will to go through you each time they need materials, and your employer may not be to keen on the idea of discounting materials for your benefit outside the scope of building your own home.

5) Five acres is really small. It will take a developer as much time to get 5 acres ready for building as it would 20 acres and the economies of scale are in the favor of larger parcels.   Depending on how much time you have and money, you could build your own home on a lot, live it in a year or two, and then builder another on an adjoining lot, and so on.  Good luck.

@Eric Delcol 

Why do people use Amazon, eBay, Letgo, Craigslist, Uber, Airbnb, FSBO, etc.? Answer, price and convenience. The internet is the disrupter to the status quo. The internet puts at people's finger tips information that was once held in monopoly, i.e. the MLS. Brick and mortar retail is a dying breed. Cab companies are competing with everyday drivers. Hotels are competing with private homeowners for nightly rooms. So, why would anyone think that a real estate agent is needed to bring together a willing buyer and a willing seller of a house when the power of information is at everyone's finger tips? Yes, agents can bring value, convenience, and service, but they are not absolutely necessary. Consider this last point, according to the Bureau of Labor Statistic "Employment of real estate brokers and sales agents is projected to grow 3 percent from 2014 to 2024, slower than the average for all occupations." Repeat, job growth is "...slower than average for all occupations." Does that mean it's a dying breed? I don't know, but those who succeed will be the ones who bring real value, not just a sign in the yard and a listing on MLS.

Mat O'Grady lease the land to a hunting club or lease to a farmer and that may cover a lot of the taxes.

@Account Closed You displayed a lot of courage by sharing your life and situations on this forum with total strangers. Sometimes the advice we get is not what we want, but what we need to hear. You're very mature in the way you're receiving all of the feedback and for that I commend you. I encourage you to continue reading motivational books, REI books, or anything that helps move you forward. You will get there! Take care.

@Account Closed You're asking for advice on how to save to invest in real estate, but there is more to it than that. So, I will take the liberty to address some things you mentioned about yourself. You're living with parents, and you're a parent. You say it may or may not be relevant having a husband/partner. It's relevant especially in your situation. If you don't already get it, I recommend you getting child support from your daughter's father. I recommend that you not borrow a DIME for a MBA, especially for an online program. You're 24 and don't mention any full time work experience. IMHO a MBA is more valuable when you have work experience to couple with it. Find a full time job and you may find an employer who offers tuition assistance. Get in the habit of paying something, anything, to your parents. It sounds like they may have a rental that you want to live in and pay only utilities...not a good idea. Pay your own way. If they choose to "gift" money to you, so be it, but if they have a rental property allow them to treat you as any other tenant. However, if you have money for rent, then you can pay a mortgage assuming you can qualify for it. Consider house hacking. Get a trusted friend to be a roommate...special emphasis on "trusted". I'm not trying to be a buzzkill, but you have some larger issues looming and if you don't get those things in order, you'll be throwing gasoline on the fire with a rental property. Get your house in order and then implement your plan(s) to invest in real estate. You not only need a down payment, you need quick access to cash to pay for vacancies, repairs, etc.  Even if you're able to go low or no money down, you still need cash reserves.  

Wishing you all the best. Take care

Todd Concienne have you done the math on renting the house? If there's on $50k equity, do you expect a bank to cashout refi the mortgage or get a second mortgage? Does rent cover all expenses including propery management? Do you have cash reserves for repairs, vacancies, etc? Also, when you move to NC, do you plan to buy or rent? If you're buying, the rent from the TX house will not be considered income until you're a seasoned landlord with usually two years of documented experience usually evidenced by your tax returns. So, that means your debt to income ratio will include two mortgages which depending on your income may put you in a pinch. Is there any other reason to keep the TX house? Would you buy the TX house as an investment rental property if you hadn't lived in it? Consider moving on, sell the house and get started on your investing plans in NC. All the best and good luck.

Christopher Smith "repairing" a roof is a deductible expense. Replacing a roof is a captial expenditure subject to depreciation. IMO, there's a thin line in what you're calling a repair vs a capital expenditure. IRS code specifically disallows as a "deduction" any amount paid for permanent improvements or betterments to property. The code further defines capital expenditures as an expense to prolong the life of the property among other things which are subject to depreciation. Good luck.

Ben D. My suggestion is nix option #2 and not lie and don't post on a public forum that lying is an option you'd consider. Focus on the other choices. You'll get what you need with a little effort.