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    Thursday, March 5, 2020

    Real Estate Investing: Recently closed on an multi family property and the seller acted like a thief towards the end

    Real Estate Investing: Recently closed on an multi family property and the seller acted like a thief towards the end


    Recently closed on an multi family property and the seller acted like a thief towards the end

    Posted: 04 Mar 2020 11:06 AM PST

    Looking for suggestions

    I hope I give you the whole context.

    I closed on a multi family investment property around 12th of last month, and before closing, me and my agent figured out that the seller's agent specifically asked the title company to not include the February rent inside the title statement because the seller *usually* collects the rent on 10th of every month, and they don't want the rent money for the first 10 days. (which is very unusual that they are not after their 1grand of money), and we are not copied on the email chain.

    Fast forward to this week, we get into contact with the renters, and we figured out that the seller drove past them around 18th of this month, and collected the rent for the entire month of February, by hand, in person, without any receipts, (this seller is an idiot who never had never maintained any paper trail, apparently collected rents by cash in person, and we are trying to get many of his mess cleaned up). The renters are pretty naive, and not english speakers, and they do not have any receipts of the collected rents from them. However they are willing to attest about that and sign that the seller collected the rent on 18th of this month after the house was closed. (He did not even tell the renters that the sale was made)

    I want to start a claim in the small claims court on the seller, and what are my options here. How do I proceed.

    TLDR: Seller collected rents for the whole month in person without receipts after the sale was closed on 10th on a multifamily property. How do I proceed?

    submitted by /u/mwmwmmw
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    Advice on how I can purchase a second property

    Posted: 04 Mar 2020 07:01 PM PST

    About me: I'm 24 years old and make around $70k per year with bonuses and overtime. I have around $30k in a high interest savings account and $20k in retirement accounts.

    I'm currently house hacking a duplex, live in one unit and live in the other. Purchased in March of last year.

    I have a 30yr fixed FHA loan for $318k remaining. House appraised for $340k when purchased. (6.5% equity.)

    Total principal and interest is $1,495.05 + $223 in PMI per month. Total cost including property tax and home insurance brings the total to $2270.24 per month.

    Other unit brings in $1350 per month (undervalued) making my total out of pocket $920.24 per month.

    If I move out I could rent my unit for $1,400 at least making it cash flow at around $479 per month.

    I tried to refinance about a month ago to take advantage of these extremely low interest rates and to get out of my FHA loan to do another one in the future. Lender said I needed at least 15% equity in the house in order to refinance a multifamily into a conventional loan. This past years market in my area was very good and I though that my house had appreciated enough for me to put a little more into the equity to refinance. BUT when I had the appraisal done it appraised for $340k (exactly what it did when I first purchased). I'm confused about how it is even possible that my house didn't appreciate a single dollar in the course of an entire year.

    Anyways, I'm looking for advice on how I can proceed and get my hands on another property. Has anyone else been in this situation. The lull between buying a first property with FHA and then not being able to finance another? Are there any other loan options out there where I don't need 15% equity for a conventional refi?

    submitted by /u/hthomas757
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    Calculating the maximum conforming investment loan

    Posted: 05 Mar 2020 01:44 AM PST

    I plan to acquire my 2nd rental property, but first I'd like to figure out how much I can borrow under the best possible terms (lowest rate and cost) on a conforming mortgage with 25% down. I'm in California, if that matters.

    Let's assume the following numbers for simplicity:

    • W-2 income: $10K/mo
    • personal debt obligations: $2K/mo
    • rental #1 income: $2K/mo (owned & rented > 2 years)
    • rental #1 PITI: $2K/mo (don't judge, the 1% rule doesn't apply here and this is just an example anyway).

    My understanding is that there's a DTI cut-off to get the best terms -- a "front-end ratio" of 36% and a "back-end ratio" of 45%. But I don't understand how rental #1 income plays into these and whether it's subject to the same ratios and further, how rental #2 potential income might play into this.

    How do I calculate the maximum PITI for the new loan? My guess is it's total_income * 45% - total_obligations = (10K+2K)*.45-(2K+2K) = $1400/mo, but it could be more if rental #2 potential income could be added in somehow. Am I missing anything? Thanks in advance.

    submitted by /u/FWF_scripta
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    New Investor, Looking For Advice on how to grow

    Posted: 04 Mar 2020 01:56 PM PST

    Hi there! I have a small condo that I rent out, and I have recently bought into a duplex and live on one side. I'm 26 and I work full time but struggle to make enough income to live and save up enough to grow my real estate investments. Any advice on how to do so would be so greatly appreciated. I would love to speed up my growth in rental properties, and hopefully dabble in some flipping as I have already done that with my currents properties, just held on to them and rented them out.

    submitted by /u/anoncafe
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    ideas how I can analyze options to sell, buyout partner, or buyout partner and pay off mortgage

    Posted: 04 Mar 2020 08:32 PM PST

    Own a home in Hawaii (Oahu) with a partner. Worth about 720k with about 370k remaining on a 3.25%, 20 year remaining mortgage.

    Partner wants to sell and contract states that if one partner wants to sell, the other has to agree or buy them out.

    Estimated home value: 762,383

    mortgage balance, 3.25%apr with 20 years remaining (370,000)

    equity 392,357

    equity - realtor fees 346,614

    half of value - fees 173,307

    cost to buyout partner's half (150,000)

    potential rent income - mgmt fee, per month 2,500

    mortgage, taxes, and insurance, per month 2,250

    3 options:

    1. Sell house and invest in SPY (S&P500) - this option looks better with the more recent dip

    My net out after fees would be about $174k

    1. Buy out partner and continue renting out house.

    This would cost me about $150k and the net income would be about $250/month best case. More likely break even after periodic maintenance.

    1. Buyout partner, continue renting out house, and pay off mortgage.

    Total cost about $520k to get about $2,500 rental income per month. Could sell house in future.

    I think option 1 is the best option but i'm not 100% sure.

    Any ideas how I can analyze these options?

    submitted by /u/caucasianinasia
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    Wholesale down payment question

    Posted: 04 Mar 2020 08:16 PM PST

    As an investor, do you have to buy a house from a wholesaler fully, or can you do a deal with 20% down payment and pay off by financing?

    submitted by /u/mediocre232
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    Commercial vs. Resedential

    Posted: 04 Mar 2020 10:49 PM PST

    Been searching for a multi family in my area for a bit now. A bunch of commercial properties have come on the market in that time and a few have actually appealed to me as they seem pretty active and that the business appear to be healthy. I have little to no experience in either market but commercial properties seem like black magic to me.... Mind giving me some good direction for commercial education? Any thoughts on starting with a resedential vs commercial?

    submitted by /u/IceDog5
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    When do you do a rehab?

    Posted: 04 Mar 2020 10:12 AM PST

    Lets say you purchase a property with tenants occupying the space and you want to rehab so you can raise rents... when/how do you do the rehab?

    I found a Triplex - all units occupied... The biggest unit currently has a smoker in it and the place smells horrible, but could probably get 300-400$/mo more if we gut the unit and start from scratch. How do you rehab a place with tenants occupying the space?

    submitted by /u/RubeNation
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    What to do with 125k?

    Posted: 04 Mar 2020 10:02 PM PST

    What are some good recommendations for someone with 125k to get into real estate investing? Think I might try to find 2 single family homes in the 200k range and put 25% down on each plus closing costs and any minor renovations. Both would cash flow a couple hundred dollars a month while the mortgage is paid off for me and the property appreciates

    submitted by /u/HairBones69
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    Private Lending with Family

    Posted: 04 Mar 2020 09:34 PM PST

    My FIL told me that he would be willing to give me a loan to purchase a condo. The condo is in a competitive market and listed at 80k. I am able to take out a mortgage for the property but I believe that coming in with a full cash deal would give me an advantage and maybe even allow me to pay a bit less. My FIL is not interested in making interest from the deal but would expect to get paid back within a couple of years. Other than the obvious advantage of paying cash, are there other advantages to paying in cash? How does a deal such as this get written? Again, it would be a loan, not a gift

    submitted by /u/Uniform2512
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    Single Family homes or Multi-Family Housing

    Posted: 04 Mar 2020 12:49 PM PST

    I am new to real estate investing. I currently have one rental; a single family home. I'm wondering, based on your experience, what is easier to manage? Multiple Single Family homes or Multi-Family housing such as duplexes. What are the pros and cons to each? Thanks in advance!

    submitted by /u/TheGreatPNW
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    First time buyer - Wise for couple to invest in 2 units in same community?

    Posted: 04 Mar 2020 09:12 PM PST

    Town homes in new, well maintained community in high developing, high demand area in outskirts of major metro area in Florida.

    There are 2 units, one large and needs repairs the other is smaller and move in ready. Bid was accepted on the move-in ready.

    If price drops on larger unit we are thinking of trying to get it too and work on necessary repairs (small cosmetic stuff). Once repaired it could easily sell for atleast 15k over current list price.

    Units cannot be rented for first 2yrs.

    So thinking to live in the smaller, and pay on both units but obviously the larger home will have to sit empty for 2yrs. Then we sell or rent smaller home and move into larger home.

    Is this type of plan reasonable and a good investment given the location, even if it stretches the budget for those 2yrs? Or is it not wise since it will have to remain empty?

    submitted by /u/underwatergrl
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    Deal Check on Duplex (Owner occupy for 1 year then rent both sides)?

    Posted: 04 Mar 2020 10:04 AM PST

    Got offer accepted on a duplex in my city.

    Price: $210,000 (Seller paid credits at closing: $10,000)

    Total Down Payment 15% down (minus credits) : $28,000

    Total rehab needed: $18,000

    Total Cost to "Get In" (down payment + rehab): $46,000

    *TOTAL* monthly payment (PITI, utilities, insurance, taxes, etc.): $1106

    *TOTAL* estimated vac/maint/capex (19% of rent): $361

    Rent per month (once both sides rented): $1850 total

    Cash Flow per month: $383

    Cash on Cash ROI: 10%

    This is a duplex in a "C" Area of my city. Isn't super nice area but also isn't ghetto. Some ghetto people nearby in one direction, + some nice people nearby in other direction. My market is definitely a "high appreciation" booming market... but I don't want to factor in appreciation into calculations because that is unknown.

    Do you think I should move forward with this deal?

    submitted by /u/nclandlord420
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    Thinking to invest in Buffalo (Duplex) out of state

    Posted: 04 Mar 2020 08:29 PM PST

    I am thinking to invest in real estate out of state in Buffalo NY, I have friend lives there. Is anyone have experience in that market?

    submitted by /u/ForRealRofl
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    Buying A 4-plex with Family

    Posted: 04 Mar 2020 07:48 PM PST

    My father is selling his rental home and wants to go in on a multi family complex with me (3-6 units). I would be willing to live at the property and be the property manager along with my day job and he would be a hands off investor. I believe that this scenario is tax advantageous for us as I would be living on site? And a better mortgage rate? I'm trying to beak the tax and bank man for the best deal. Suggestions? Anyone done something similar?

    submitted by /u/spankyassests
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    Stay in the house a year after a refinance?

    Posted: 04 Mar 2020 07:57 AM PST

    Currently live in a house we always intended to keep as a rental. Been in the house for a year now, but are going to refinance because the rates have tanked. Do we need to stay in the house another year after the refinance before we can move? I understand that is the general rule for buying a house, didnt know how it works with a refinance.

    submitted by /u/357mags
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    How nice was your first property?

    Posted: 04 Mar 2020 05:20 PM PST

    I am considering townhome without hoa that looks very meh on the outside but nice on inside for 158 k. Should yield well just really don't look nice from outside

    submitted by /u/Firm_Salamander
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    Mortgage loan for newly self employed

    Posted: 04 Mar 2020 05:02 PM PST

    Is it possible to be approved for a loan while being self employed for only 1 year? I've tried multiple lenders and they all look for atleast 2 years of tax returns. Is my only option to wait?

    submitted by /u/YurrCaptain
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    Any of you have a view on Douglasville?

    Posted: 04 Mar 2020 04:54 PM PST

    Property management

    Posted: 04 Mar 2020 12:48 PM PST

    Hi everyone. I'm new to rental property investing. I am looking for a property management company to guide and manage my property in South Florida. Does anyone know of a great property management company

    submitted by /u/georgeleneljean
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    Thinking about investing in a property which has a Petrol Station along with another building that has fast food restaurant and a general convince store

    Posted: 04 Mar 2020 12:45 PM PST

    Hey so from the title, I might have an opportunity to purchase a lot that currently has a gas station and convince store along with an another building that is currently a fast food restaurant all on the same lot. All businesses are already leased out with quite a few years left on the term.

    I'm nervous about the Gas tanks, I case they start leaking into the soil? And if banks in the future will let me borrow off of this investment BC of the risk the tanks that hold the petrol create

    Advise, notes or comments would be appreciated

    submitted by /u/TheLonleyDoctor
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    Accepting lower rents than expected as you close?

    Posted: 04 Mar 2020 12:01 PM PST

    Hey all - would appreciate any advice if anyone's been in a situation similar to this.

    My partner and I are under contract for a 3 unit building - we intend to occupy one (currently vacant) unit. The other 2 units are leased, and, because this is the timing luck we have, the leases are expiring right as we're buying the place.

    The seller was basically willing to follow our lead with the leases - we said we were fine renewing, since the rent has been getting paid and the tenants have kept their units in good condition. However, one of the leases is actually paid by a non-profit (on behalf of a named tenant, so it's not like a lot of people will be coming in and out), and the non-profit has told the seller that although they'd like to renew, budget issues this year mean that they'll have to cut the monthly rate by $200 vs. last year.

    The lease before frankly was at the high-end of market rate for a unit like this, but the seller is now basically asking us to accept a property making $2400 less next year than what we'd planned (and what they'd said based on the real estate listing).

    Frankly, it's still not a terrible deal, but has anyone encountered this when buying a property?

    If so, did you ask for (and/or get) anything from the seller?

    My gut feeling is to ask for a credit equal to 1/2 the difference for one year ($1200), since that's the term of the lease and we're essentially splitting the difference. The seller has also offered (not in writing yet) to try and find a new tenant, but that just seems like it'll delay closing further.

    Any thoughts or advice?

    submitted by /u/coolerblue
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    How much rent would you want from an investment property that costs 200k?

    Posted: 04 Mar 2020 04:23 AM PST

    I have 50k to invest in real estate. Please help me. (Atlanta)

    Posted: 04 Mar 2020 07:58 AM PST

    Hello All,

    I wanted to get your opinion on getting into purchasing rental property in the Atlanta area. My current townhome in East Point is appraised at 125k and I owe 45k on it. That gives me roughly 55k in equilty to take out. I was thinking about using the 203k loan to rehab a quad and owner occupy.There are a few in the city (College Park and Clarkston) for around 200-250k. My other option would be to acquire a duplex in one of the hot up and coming neighborhoods (Westview,Westside,Oakland City, Pittsburg). With the rest I was thinking I could take advantage of the Homestyle loan to rehab another multifamily or just purchase a house with the remaining cash an sit on it.(Preferably Westview,Westside, or Oakland City). I have a few questions for the group:

    Does this seem like a sound plan?

    How soon after the quad is full do you start on the next property?

    Should I AirBNB my current space or regular rental?

    My credit is 750 and my salary is 190k. I do have 2 kids and most the multifamilies are 2bd but I think we can survive for a year.

    Any input would be appreciated.

    submitted by /u/lefhandit
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