All Forum Posts by: Aaron Rowzee

Originally posted by @JD Martin:

I don't think bedbug carrier is a protected class. 

Oh my God, I'm laughing so hard over here. This has got to be the quote of the year on BP!

And I would absolutely agree. Not protected, no way for them to sue and win. And do most people who are renting actually sue? I would think a majority aren't doing well enough to buy, so how would they possibly afford a lawyer?

YES! Great post! Investors who are absolute scumbags ask a wholesaler what their fee is, IMO. IT DOESNT MATTER! If the deal works for you and its a "great deal" then what does it matter? Every body is trying to make it doing what they love and are good at. I've done 2 wholesale deals myself making 13k on the first, and 5k on the second. I'm really not a good salesman in the wholesale realm, and I leave it to folks in my area better than I.

I've both met and heard of investors who will demand to see it, and won't buy if the wholesaler is "making more than me doing nothing". I blacklist every. single. one. of those people. They have no business being in business with me or any other quality investor I run with. And in case you couldn't tell, I'm extremely passionate about it. Investors either have the wisdom and character to appreciate a good wholesaler who can supply them with easy and quality leads all the live long day, or they can go be a communist and a thief elsewhere. 

And by the way, did you know this guy well? I'm super surprised he didn't do a double close and hide it.

This thread has peaked my interest. Following!

Originally posted by @Matt K.:

Originally posted by @Anthony Gayden:

Originally posted by @Steve S.:

BiggerPockets for a long time was a great place where investors could meet and exchange information and work together. Over the past year I have noticed a trend of a lot more newbies coming in just looking for information and a lot less real players who truly invest and work together. 

SO... I have two questions....

1) Has anyone else noticed this trend?

2) Where are the real real estate investors conversing if not on this forum?

Trying to figure out where everyone went.

-Steve

 The problem is defining who the “real” investors are.

How do you define it? Net worth? Properties owned? Years of experience? 

A doctor who owns a 24 unit apartment complex valued at $1.5 million. That is his only deal and he bought it turn key and out of state. Compare that to a mom and pop investor who owns 6 properties which he bought and rehabbed individually, he self manages and has been investing for 10 years, but the value of his properties is less than $1 million. Who is the more experienced investor? 

 Let's go by votes, if you're not over 1k votes you obviously aren't real....

(hopefully my sarcasm comes through loud and clear....)

I'm not a real boy.... (queue the sad face and Pinocchio nose)

Here is the lease for those of you wanting to look at it. 

Redacted lease agreement

@Craig Curelop and these forms any different then the ones that came with the BP book on property management? Does the lease agreement have stronger language and more clauses the other from Brandon's book?

Originally posted by @Walt Dockery:

Originally posted by @Aaron Rowzee:

Originally posted by @Stephen G. Wolff:

No, yes. The lease stands and you should negotiate with the distressed seller prima facie. Another option is to convince the seller to that they should negotiate a buyout of the existing lease and you then could obtain the property on month-to-month terms. It may be cheaper for the seller to give them a free month rent in exchange for voiding the existing agreement. However, you lose in this scenario you are the bad guy and jack the rent up.

Lose-lose consider passing. 

The numbers are pretty set as the owners are selling it practically at the cost of the mortgage still owed.

The numbers are never ‘set’ until you have a signed/executed contract. The market value has nothing to do with what the current owners owe on their mortgage.

They want (and on some level most likely need) to sell, and you do not need to buy. As you said in the OP, the #s aren’t interesting at the current price and rent.  If you can’t buy it where the #s are interesting, walk.  The below market rent isn’t the tenants’ problem, they got a deal and it’s the sellers loss that they signed a lease that much below market. I would counter the sellers at a price where it’s interesting to you, and walk if can’t get it at a price that makes it worthwhile. 

Awesome point! 

And to address others in the thread, I'm well aware that legally the lease goes with the purchase, but what I failed to communicate clearly is what are some creative ways to deal with it. There has been some incredible ideas about buying out, and renegotiating with the tenants which is exactly what I was looking for.

I guess the only other direction to investigate would be some sort of creative finance for the purchase. They owe roughly 100k on the home and really they are wanting to get the burden off of their shoulders and the constant bother of "dealing with tenants". I think they just emotionally and mentally want the home gone.

Can anyone think of a owner finance deal that would remove the wait from their shoulders, but keep me afloat for 12 months until I can get a higher rent and refinance the property? To be honest, I struggle with out of the box financing. Its like a mannequin: I have to see the suit and tie all put together before I can tell it looks good.

Originally posted by @Will Gaston:

@Aaron Rowzee I'm actually closing on a property next week with this exact same situation. I think it's a pretty simple really. I'm going to run the numbers and offer to buy them out. 

A couple of thousand dollars in my market will go a long way.

They might not take it but I think they'll definitely think hard about it when they know that there lease will certainly not be renewed.

 Will, what are you offering them or willing to pay for the buyout? 1 months rent? 2?

Guys, thank you all so much for the great info and points to ponder. I have to say, its refreshing to be able to ask questions like this and not get shouted down or banned on the assumption that I want to do anything illegal or unethical. As I said before, I have no intention to break the law or violate tenant rights, but seriously had no idea how some have changed agreements before... then enters @Chris Youssi with exactly what I was wondering:

So you can give them the option to renegotiate on the spot with a new lease? This was really what I was trying to figure out. I see how leverage on my end would work, but I did not know the new lease could be replaced assuming both parties agree and sign on the dotted line. Correct me if I'm assuming incorrectly here.

Originally posted by @Stephen G. Wolff:

No, yes. The lease stands and you should negotiate with the distressed seller prima facie. Another option is to convince the seller to that they should negotiate a buyout of the existing lease and you then could obtain the property on month-to-month terms. It may be cheaper for the seller to give them a free month rent in exchange for voiding the existing agreement. However, you lose in this scenario you are the bad guy and jack the rent up.

Lose-lose consider passing. 

Great idea! I love how out of the box this community is. The numbers are pretty set as the owners are selling it practically at the cost of the mortgage still owed. I'll see if there is a way to do the buyout.