All Forum Posts by: Bob Young

Thank you Jessie. I do have a lot of pictures. The damages were a little more but i covered them. Had I known it would go this route I'd of been much more of a stickler and just increased the repairs more as I did come out of my pocket for costs after the fact. 

I don't own this as a business, its basically a home I left when relocating so now rent. As such I am probably too lenient than those that professionally do this.  Live and learn I guess....

Appreciate your response 

Andrew, this all happened in a matter of week in their last month. Regular inspections would not have prevented it. 

Thank you for the response Deanna. 

The focus of my claim would be on the provision of the lease stating they need to allow time for me to show the property. Here the tenant did not allow me to show the property at all and by the time we finally got access to the property it was not presentable to show prospective tenants. 

Is there a way to enforce it or just doesn't really matter in a dispute?

Hello, I am in NJ and own a condo rental. Had a terrible tenant for a year that finally moved out. Chronic late payments, bounced checks etc. however ultimately I was made whole and got rent for each month. Prior to lease maturity they request a 1 month extension which I agreed to and they were to allow me to show the property per our lease agreement. 

They became very unresponsive and I have documentation on all attempts by myself and realtor trying to get in the property. It was not until the 13th of the month I got a text notifying me they shattered a window, plus other damages. In the same message they stated that is why they were not responding. Long story short, I worked with my realtor and he finally was able to enter the property on the 19th (they kept delaying) and set in motion the repairs. He said the property was a mess and there was also significant damage to my hardwood floors which need full replacement in sections (tenant paid for that prior to moving). At this time it was not in a condition to show any potential prospects. 

Fast forward, they move out end of month and we make repairs. I had $3,000 in security deposit. Repairs were $780. Monthly rent was $2,000 and they got the balance in returned security deposit. I feel obviously that $2,000 should still be kept as I lost an entire month of opportunity to market the property and surely would have had a new tenant lined up. I received a notice from the former tenant requesting the money $2,000 returned and threat to sue. 

NJ not being too landlord friendly - I've come to learn, from an attorney, that the $2,000 in rent I cannot keep from the security deposit as it is "future rents." My only recourse is to take them to small claims court. 

I'd like to get feedback from others who have experienced this and if it's best just to suck it up and move on, or if there is legitimate chance of me be successful in court? I have a tremendous amount of documentation and every single text message conversation we had showing how accommodating as a landlord I was and essentially proving with their own words they are lying in the letter they sent to me being unresponsive and never asking them to show the property etc. But does that even matter?

Appreciate your time in reading this and look forward to feedback. 

Darwin, will try to answer and hopefully I reading your post correctly.

If you are looking to buy commercial property in which your marketing company will occupy over 51% of the space, then SBA financing is an option (504 or 7(a) loan). You would set up an LLC holding company for the real estate. That LLC will be the "borrower" and the guarantors on the loan will be your marketing company and you personally.

Ultimately this depends on your marketing company's financial performance and the ability to service the proposed mortgage. Since you currently lease that is good, as that lease payment is added back into the cash flow analysis.  (fyi, lenders also look at your personal income/expenses to make the loan decision - called "global debt service coverage ratio").

PM me if you have any additional questions.

Hi Kyle,

The seller carry note has a 2 year required standstill (required per SBA policy) which can then convert to an amortizing term loan once the 2yr period is over. During the 2 year standstill the loan CAN accrue interest at a rate agreed upon with the seller. What the loan converts to after the 2 years and repayment terms is typically up to the borrower and seller.

Lender policy may vary. I have done loans where the a lender really doesn't care what the agreement is i.e. payback over 3 years, 5 years etc. Others tend to like the seller note to be repaid at the same terms of the loan, which I see most often in business acquisition loans (they go up to 10 years terms w/out real estate). Others are fine for example matching the seller loan amortization to the term of the loan, but allowing for a balloon where the loan can essentially be paid in full well before (the lender may even be in a position to refinance it out for you both if the numbers work).

The SBA policy is basically the general guidelines for all lenders to abide by and then each individual lender will layer on their own preferences to meet their credit risk profile. This plays a big part in the type of financing that can be done or industry. For example, some lenders may want to stay far away from the hospitality or restaurant industry, while another lender may love it and have it be a main focus of their business.

Since this is a new purchase (and currently not renting the subject space), you will be required to put down money. SBA and USDA (pretty similar in many aspects) can allow as little as 10% down, however generally speaking I think it was sound advise from Scott that you may need to put down more down, possibly up to 25%, which of course can be a combination of your money and seller financing. Say 10% you and 15% seller. The SBA also has 2 programs for real estate purchase - 7(a) Program and 504. Each has their advantages.

Talk to lenders and they can provide insight to their potential structures (interest rate fixed vs. floating, seller note, down payment etc.). Also be prepared to share the business plan and likely need to do at least 2yrs of projections since this is really a new phase of the business (consulting to now operating a venue).

Hope this helps. I am new to bigger pockets and posting, but been all over these boards for months for my own personal investment knowledge.