All Forum Posts by: Jon Holdman

Should they?  Perhaps.  But it really doesn't matter to the land contract buyer.  The LC buyer pays whatever their agreement says to pay.  When they meet the terms of the contract they get the property.

Now, where this matters is to determine if the seller can actually deliver.  If the terms of the loan vs. the LC are such that the seller is underwater at any point in the term of the LC, then the seller may not actually be able to deliver clear title.  That would be a problem for the buyer.

So if the monthly rent is $500 then you're paying $6000 a year.  To pay $6000 a year on a bi-weekly basis you would pay $6000/26 you would pay $230.77 every two weeks. Certainly when I've had jobs that paid every two weeks vs. twice a month that is EXACTLY how they did the math.  It doesn't really matter if there is an "extra week" in the month.  You pay every other week.

If you're asking your landlord to switch to paying every two weeks and he's asking for $250 to make that change, then he's wanting extra rent to make the switch.  You would be paying $250 * 26 = $6500 a year which is equal to $541.67 a month.  If that's what happening you could try negotiating for something in the middle.  Say $240 every two weeks.  If you're asking for the every two week payment schedule you should expect to pay extra.  

OTOH, if the landlord is asking for this change, I'd insist on the correct amount - $230.77.

Well, we don't actually need your payment and income, just the ratio. If the total of all your debt including this car payment is under 8% of your gross monthly income this won't have much effect on your ability to borrow for a primary residence. If its over 8%, yes, that will reduce your ability to qualify for a loan by the amount over 8%. Typically lenders want your total PITI to be under 28% of your gross income, and total debt to be under 36%. But this can depend on your credit score. Have a look at the Fannie Mae Eligibility Matrix for details.  Page 4 shows DTIs and credit score requirements.

Doesn't matter that your girlfriend makes the payments. Your name is on the loan.

To answer your question, yes you can buy with the tenant in place.  They become your tenant.

Is this a residential lease?  In which case residential laws would apply and the tenant is probably violating that lease by running a dentist office.

Or, is it a commercial lease.  That are usually much more complex but also much less restictive in terms on what the landlord can do.  For example, with a residential lease the landlord cannot just lock the tenant out.  With a commercial lease the landlord typically can.  You should discuss the situation with a local attorney.

If you do buy with the tenant in place you need to factor the cost of dealing with this situation into what you pay for the property.

When you close on the refi you would get a check for about $10K.  Most of the proceeds from the new loan will go to pay off the old loan.  You start paying on the new loan per the loan terms.  The new loan terms will likely be similar to the existing loan terms.

Because you're doing this only two months after the original purpose, the new lender may use the price you paid, $73,250, for the value, as long as the new appraisal is higher than that.  You typically (though not always) need to wait at least six months before the new lender will use a new, higher value from a new appraisal.

As a buyer there is NO way I would go for this unless I intended to default.  On a $184,900 loan at 7.75% interest compounded annually the interest after five years would be $83,684.86.  You want that plus 90% of the principal at the end of five years.  So, in addition to paying interest on the unpaid interest, I have to write you a check for $250,058.86 at once, five years from now.

As a seller and lender, no way either.  Even on a hard money rehabber loan I want payments.  If I (as buyer) was just looking to live there for five and a bit years I might sign up with no intention of actually paying.  Especially being older.  Maybe I die before the five years is up and leave nothing in my estate.  You get the house back, but I lived for free.  Or, maybe I just plain plan to default and walk away rather than paying you the $250K.  You foreclose.  If the house is worth enough, someone bids and wins, you get paid off and again, I lived there for free.

Evictions are all or nothing.  You don't evict some of the residents and not others.  Your tenant is the issue here.  He or she violated your lease when they allowed the family to move in.  This is a good reason to avoid mixing business and pleasure.  Your "friend" made an agreement with you then violated it.  And in a very serious way.  To me, that ends the friendship and now you can focus on business.   Evict them all.

No, you cannot just tow the inoperable vehicles.  That would be a "self help eviction" and would make a bad situation worse.

Sorry, I have no references for an attorney in your area.  You need one.  Try contacting your state bar association and see if they have lists of attorneys by specialty.  Sometimes these are online.  Or look for an apartment owners or landlords association in your area.

If you bought a property with the intention of renting it, then got an offer you couldn't refuse and sold it within a year it would be taxed as short term capital gains.  That is at your ordinary income rate.  If you sold that property after holding it at least one year, it would taxed as long term capital gains.  In both cases, you will also have tax on unrecaptured depreciation for the amount of depreciation taken (or allowed, if that's greater.)

If you bought a property intending to fix it and resell it the holding period is irrelevant.  The gain is ordinary income and taxed just like any other earned income.   The income is also subject to self employment tax which is both halves of medicare and social security.

I really don't know.  @Mindy Jensen?

Bummer of a situation.  This is the sort of thing you really must investigate before purchasing rather than relying on any seller representation.   Any sort of non-conforming use carries greater risk than if you're in conformance.

Duplexes and SFRs are appraised in the same way - comparable sales. The size of each floor is the main determining factor. A duplex with the same total size, beds, and baths as a SFR in similar condition in the same area is going to appraise at about the same value as the duplex. Sometimes investors think a duplex is more valuable based on the income it generates. True for the investor, but not so much for an appraiser. Big properties get valued based on income, but for a duplex or SFR its all about comps. So, could you convert it to a SFR and do the refi?

If you want to address its zoning you need to be talking to the planning and zoning office rather than the mayor.  There is usually a process for rezoning a property, provided the desired zoning is somewhat in line with the neighborhood.  The zoning office should be able to advise you about the possibility of changing the classification.