All Forum Posts by: Axel Norvell

I did some digging (pun not intended). In Texas, we have a government agency called TCEQ (Texas Commission on Environmental Quality).

https://www.tceq.texas.gov/

This agency regulates things like underground fuel storage tanks. Apparently, there's no record of this tank that TCEQ has, so according to an oil tank removal company the process involves registering the tank, then applying for permits to remove it.

That of course comes along with ground samples needed to ensure the surrounding area has no leak or contamination.

Ballpark cost is anywhere from $25k to remove, and add another $20-30k potentially if there's soil contamination (depending on the size of earth that needs to be removed and replaced).

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Takeaways - probably never a good idea to install an unregistered fuel tank on a residential lot in a major city :| 
 

Hi all,

Has anyone here dealt with an oil tank on a property they purchased in the Houston area? I'm about to go under contract to purchase a SFH with an extra lot that happens to have an old oil/gas tank underground.

I've done some preliminary searching and all I could find in terms of cost to remedy is anywhere from $2,500 for a basic removal, all the way up to $100k for a major contamination problem (replacing all the contaminated soil).

The sellers are selling the property as-is, but this is an item that has a massive range of risk so I'm wondering how to better mitigate and reduce that risk.

Thank you!

Finally got them to remove the taxes that did not apply. But now having to go back again and have them fix the appraised value taxes which they have wrong.

It seems kind of unfair and bad that the lender can so easily manipulate the escrow amounts without any quick-recourse for corrections.

It's taking me over 2 months of constant follow up, emails and providing proof to get them to fix these issues. I know that I'll receive a refund for the overpaid escrow, but having the ability to increase mortgage payments by hundreds of dollars unannounced and incorrectly during a pandemic seems pretty ridiculous. 

@Ross Rauschenbach thank you for the info!

I reached out to Greater Northside District and they said my lender made a mistake. Residential properties are not taxed which is what mine is.

I followed up with the lender and they're looking into fixing it.

Thanks again!

@Ross Rauschenbach thanks for clarifying!

What do you think I'd need to produce to the lender to avoid the $200+ increase to my mortgage payment for escrow?

Obviously it's one thing to call and complain, but they're going to want to know 100% for sure the tax isn't applicable.

Do I call HCAD and get them on the phone with my lender? Any insight on the correct process for disputing incorrect escrow amounts with the lender?

I own a property in Houston area code 77009, and the total property taxes for 2020 were $7,774.04.

However, my lender added a NEW additional tax for 2021 adding $5,574 to my tax obligations as shown below:

When I look at the the HCAD tax jurisdictions, I see this has always been a blank item going back for all past property tax records:

And when I look at past property tax bills, this line item has NEVER had an amount.

Does anyone in Houston familiar with property taxes have any idea what is happening here? I called my lender and they said that I was only paying $0.01 for that tax for 2020 which was wrong. 

In 2020, I did protest my taxes and get them lowered significantly. Is it possible that the $7k was reduced to $5k, and the lender got two bills and got confused?

The extra $5k tax was a huge surprise and increased my mortgage payment by $200 / month which is crazy.

I don't plan on property management anytime soon, but yes I understand your view. It's just not a part of my goals right now, and finding deals in my market that make sense after 10% property management is pretty tough.

If I did deduct 10%, I'm getting a 6% ROI on my cash which isn't great. But it's still cash-flowing and gaining equity. Plus, it's a property connected to a large lot I already own, and there's a premium in my city on selling combined lots in hot areas.

As far as the bills, the property technically isn't a triplex - but it could be configured that way. I would want to avoid the high cost of separating the meters, and avoid having tenants split the bill.

I think I'm going to end up doing a conventional loan on this one and putting in a down payment. That way I avoid a risky refinance situation, and avoid the seller's high interest terms which aren't great.

The fact that the property is next door makes it super easy to manage, and it'll add another positive income stream that also helps build up my equity. I'll save any cashflow I receive and put it right back into buying 3rd property.

I’m house hacking in the inner loop.

Found a 3-unit property. Includes a main 4bd 2ba house and a separate 2-unit apartment behind it.

I used an FHA loan and only put $12k down

My rents cover the mortgage, taxes and insurance. I’m only paying ~$300 in bills and I can completely eliminate that and get positive cash flow if I rent one of the spare rooms I have.

Happy to share details / numbers if you’re interested.

@Aaron Montague @Brian Ellwood - these are the numbers I'm working with. This would be with a conventional loan at 15% and a 3.625% interest rate for 30 years fixed. I ran the numbers through various scenarios I could do with the property. My best scenarios yield around 12% return on my $40k cash spent. The owner isn't giving me great terms on financing, so I'm considering just using a conventional loan to lock in a low monthly payment/interest rate and won't have deal with refinancing later.

What do you think?

@Brian Ellwood thanks for your thoughts. The owner is actually asking for 20% down and a $230k sale price as a counter which is a bit crazy. I might as well do a conventional loan at that point.

He expressed that he's not too excited about "being the bank" so I can understand why - he wants to see some cash up front. The problem is banks offer much better terms.

I'm also worried about the Interest only payment because I won't be paying down the principal balance. That means the property absolutely needs to appraise 20% higher than my balloon payment to hit that 80% LTV when I refinance.

I'm going to continue to negotiate and see where I can land and hopefully come out with terms we're both happy with.