All Forum Posts by: Alex L.

If I had the opportunity I would absolutely switch to the fixed rate. I've been watching my rate climb from 5% to 10%, and I don't anticipate it going lower anytime soon. 

 You can do quite literally whatever you want with the excess money pulled out of the refi -- blow it at the casino, remodel your bathroom, or put it into another investment. It's not taxed as it's not considered income, it's part of the loan, and you're still going to owe it back to the lender in the long run.

Assuming no legal issues, and also assuming the inherited tenants are on a MTM lease at this point (if not, I'd wait until the lease expired and would continue with their tenancy under a MTM basis), I'll typically raise rents by $30-50 every six months to get closer to market rates. I also let the tenant know well in advance (3 months or more) when the increase will happen. That way it's not too jarring and is easier to digest and prepare for. You can certainly dump the cold water all at once and raise the rent to market rates all in one go, but I personally prefer not to.

I have one property that I'm getting from $550 to $750 using this method, and then once the tenant leaves I'll go in, do some updates, and rent it back out around $1k. The tenant may very well decide to stay though, and in that case, I'm comfortable allowing them to stay there below market with reasonable yearly increases for inflation and whatnot since the tenant in question is long term (2018), causes no issues, and rarely bothers me for anything. I've only had three issues to address during their entire tenancy -- replacing an old, faulty HWT ($650); having racoons removed from the attic ($200); and replacing an electrical breaker ($50). Nothing beats a tenant who doesn't bother you lol.

Speaking as someone who used to work in the insurance industry, the owner can indeed be sued if someone drowned in the pool due to negligence (the negligence in this situation would be the owner's failure to secure the pool). 

So, just make sure the insurance co. knows that the property has a pool, and ensure that it's properly secured -- that means a lockable gate around the pool (you'll see this more with in-ground pools, some properties will literally have a separate gated pool area within their fenced in yard), or a door with a latch to the deck of the above-ground pool (if there's no deck, there are some pool stairs that have a lockable "door" or something on it to keep people from climbing). This is pretty much non-negotiable from an insurance liability standpoint -- the pool must be secured, one way or another, as unattended wandering children who could drown are the primary concern here.

Having a fenced-in yard is beneficial, and the insurance co. may accept simply having a fence enough to consider the pool secured. However, to really ensure safety from liability, you'll ideally want both a fenced in yard, and a secured pool. If a neighborhood kid hops the fence, swims, and drowns, the property owner likely won't be held liable as the fence was adequate security, and the neighborhood kid had no business being there. However, if the kid is a tenant of the property and has regular access to the backyard, and while playing in the back unattended one day decides to go swimming alone and drowns, the property owner can absolutely be held liable because they didn't properly secure the pool. 

EDIT: As an additional measure, I would also recommend that the property owner or manager ensures that the tenant is instructed on how to properly secure the pool when not in use, and have them sign some sort of documentation stating that this instruction was provided, and that they understand the pool must be secured at all times when not in use. That way, god forbid something awful happens, the tenant won't be able to cast blame on the owner/manager for not showing them how to secure the pool.

Hope that makes sense.

Pretty much every property I BRRRR cash flows between $300-500 with $0 to ~$10k of my own money still in it, and frankly, I'm absolutely chuffed with those numbers. I'd call it a win.

If you're just worried about asset protection, an umbrella policy would suffice more than enough and would be easier/simpler to manage rather than a business entity. If it's privacy you're after, you'll want to form the LLC and purchase the properties through them outright, otherwise there would be a paper trail if you were to purchase the property under your own name and then transfer it to the LLC (i.e. where I invest, the auditor website shows transfer history).

Like others have already said, you're going to have to pay out of pocket for this. As a former insurance adjuster, home insurance would only pay for removal of the tree after it's fallen... and even in that situation, there's often a limit on the amount paid for tree cleanup (at my previous company, that limit was $1,000 for every policy that came across my desk. Many policies don't even cover tree cleanup unless the tree caused damage to something else. In pretty much every situation, however, if you're aware that the tree is rotting and dead and the tree causes damage to a neighbor's property, you yourself can be held entirely liable for those damages. 

My best advice is to call the smallest licensed and insured tree company you can find... the more local, the more cost effective it'll likely be as well. I have a MASSIVE oak tree at one of my properties that is very much alive, but is damaging the driveway and sewer lines. I've had about 6 different estimates to take it down, ranging from a low of $2,450 to $6,800. The $2,450 estimate came from a local well-loved licensed and insured company that is based in town and has their main office about 5 minutes from the property, so I imagine that's part of the reason why it's so cheap compared to everyone else... nobody else came in under $4k.

Good luck.

Are you saying that you'd like to move someone else in the unit or use it as a STR while it's already rented to a tenant who just doesn't happen to be there often, yet is still paying their full amount of rent? I personally wouldn't make any changes at all... seems like too much potential trouble than it's worth. I'd rather have a mostly-empty unit that has it's rent fully paid by the absent tenant vs have to manage what seems like it'd boil down to a situation where you're juggling roommates/two or more leases on a single multi family unit. I don't even want to imagine what kind of drama would arise when the absent tenant returns to find someone that they simply don't gel with sitting on their couch watching TV lol.

The bottom line is that I am simply an anxiety-ridden individual with OCD among a slew of other 3 and 4 letter acronyms, and so I am absolutely willing to pay the price for a better night's sleep assuming it's not an exorbitant amount (and while also understanding and agreeing with you that anonymity is overrated because if someone truly wants to cause harm, they will find a way). The perceived anonymity is just a little extra layer that helps me sleep better at night, knowing that most people won't dig too deep unless there's a valid, reasonable purpose. Ever since organizing my anonymous LLC and purchasing/holding properties solely through it, I haven't received a single unsolicited communication from outside parties offering to purchase them, and just that peace alone is so nice to have. I also hang out in a few spaces that aren't exactly landlord friendly (simply the crowds that I run with; I have no interest in changing this, and have since learned to live with my conflicting interests), so I enjoy having as much distance between myself and my investments as I can get.

To determine what rent should be, I use a mix of rentcast.io and rentometer, and then compare to what other properties are currently renting for through Zillow. 

As for what my goal is when it comes to monthly cash flow, minimum $350/door after PITI + $125 for maintenance fund.