All Forum Posts by: Bill Tyler

Does your  rental contract with the tenant have a section about "guests"?  Many here in Texas will add a clause stating that you may not have any guests longer than ____ days (typically 7). 

If so, boot her out quickly.  Change the locks now.  Michigan tends to favor the squatters over the owners.  It may seem cruel, but if you have to call animal control for her 2 dogs, then do it.  Was there a clearly stated pet policy in the rental contract?  What about restricted breeds?

I have a friend that at one time owned over 70+ single family rentals.  He had the police knocking on HIS door in the middle of the night to take him straight to a Judge.  One of his tenants had a police visit due to a noise complaint.  The police smelled marijuana when the tenant opened the door which gave them probable cause to search.  The police found multiple types of drugs AND a baby in one of the closets that someone had traded for drugs.  Long story short, because my friend was well known in his town, the Judge started the eviction process immediately.  I would MUCH rather lose some rental income than have the State seize my property because of tenant drug use.

Do you have contracts from the previous owner that you have to honor? If so, follow them to the letter and make sure your renewal contracts are detailed with any fees and all expectations.  You might also look at options so the tenants can pay online so you won't be waiting for a check in the mail.

In most cases, the more access to credit the better your score. BUT - you need to use only 30% of you credit line or less. For example - if you have a $1,000 credit limit - do no use more than $300.  You don't have to use each card all of the time - just twice per year will keep them active (maybe lunch on your birthday and a tank of gasoline some other time during the year). 

Another thing to keep in mind is that you need to be able to pay them off each month. PERIOD.  If you can't pay it off at the end of the month - you don't need to purchase the items with your credit card.  Also, by paying the entire balance each month you avoid paying interest with most credit cards. 

I have paid cash for everything for so many years that my credit score didn't really exist.  I started with a secured card from USAA.  I use the card for all of my day to day purchases because it offers better protection against fraud than a debit card.  At the end of the week, I pay off the charges.  I now have 2 unsecured cards as well and in about 6 months have boosted my credit score by 85 points.  

Good luck! You might also sign up for a free account at CreditKarma.com and you can follow your score and get other suggestions.

Great job with the deal and some very useful information on financing an all cash deal!

I purchased a house in Detroit through Homepath in 2011.  I went through the "First Look" (owner occupied) and actually moved up there for a year. It was a very good learning experience for me being from Texas.  However, keep in mind that there is a HUGE learning curve for Detroit.  In many cases, I found that it was like a 3rd world country.  

Unfortunately, I'm not able to help you regarding the LLC. I would highly recommend find a good realtor from that area that has experience with Fannie Mae processes - because they can be tricky. Also - make ABSOLUTELY CERTAIN you add a clause to the offer/contract that ALL back taxes and water bills must be paid IN FULL before close. DO NOT deviate from that. They offered an allowance on the water bill of about $250 for mine and I would be responsible for the rest. Come to find out the outstanding water bill was nearly $4,000!!! Oh - and Fannie Mae spent nearly $10,000 to sell me the house for my offer price of $600.00

@Andy W. Congratulations!!!  Check the garage for a boat - it might come in handy!

@Jon Klaus Thank you!

Get in touch with Grant Kemp at:

http://www.texaspridelending.com/

He is licensed in 39 States as a RMLO - find out if he is able to prepare contracts in Maryland.  You can connect with him here on BP also.  I'm sure you've already listened to him on BP Podcast 070 - if not, it is well worth your time.

What a great podcast!  For all of us with less experience - this may be a very good way to add both instant income (from the down payments) as well as monthly income. 

Could this method be used for small multifamily properties?  I have my eyes on some in DFW.  The owner has 2 quadplexes and 1 triplex on the same block.  I would love to be able to acquire them with some creative methods using as little of my cash & credit as possible.