All Forum Posts by: Brendan F. Nagle

Think of tenants like NFL draft picks. How high is the ceiling, how low is the floor? I family tenant at best will be a tenant who pays on time. At worst, you get to hear how much of slumlord you are at Easter, Thanksgiving, and Christmas assuming Covid-19 allows for family dinners in the future. 

The other more dicey side of this is how would your relationship change if your B-in-law can't pay. The only good side of this is you could have a practice tenant to work on your landlording skills. Good luck in your journey.

I have had good luck with a non conforming SFH that has a mother-in-law suite. SFH financing and I was able to have roommates that cover 9/10th of the Mortgage. Trying to find the Unicorn that is the ready to go Tri or 4plex that is affordable in a neighborhood you want to live in is difficult. Not impossible but difficult. The positives of the big or weird SFH that could be a duplex is that you aren't competing with other MF and your looking for the ugly ducklings that many SFH buyers don't want.

To find these gems will take work. Walk the neighborhoods you want to live or invest in. Look for the odd ball house or a separate side entrance that can pay dividends later. Good luck on your journey. 

Please read 4 hour Work Week by Tim Ferris. The math of how do I get to 5000 a month is easy. The reality is that 20 doors will cashflow ebb and flow differently. You will need reserves, 6 months expenses in the bank. A property manager and team that take care of your property. Tenants that pay on time and no black swain events in the next 10 years. How many people on this website, had Airbnb dreams or vacation rentals that just went splat a month ago. One winter repair bill or surprise from the HOA of the condo will take years off your cashflow for a unit. The book also relates to how to solve problems remotely.

Now how to accomplish it. BRRRRR each house or MF to get to the desired amount of units. Use the cashflow to get a large cash reserve, then poor the rest in to debt paydown. Decide how long you want to be in Spain retired for. 2,5,10 years. Sell your worst performing rentals and redistribute that equity to other asset groups with dividends. Retiring forever, requires unlimited funds. But a finite amount of time can be eaten like an elephant, one bite at a time.

Good luck on your journey.

As I write this, I have 3 late rents to collect of my 10 doors. All tenants have been contacted and reminded to communicate if there are issues with the unit, jobs or their ability to pay rent/on time. I called and texted each tenant. Collected emails for the ones I didn't have. I found Zenlordpro software to give me the landlord the ability to receive rents electronically and gives the tenant more options to pay rent ACH or by credit card. As well as maintenance reporting without having to physically be there. 

When talking to tenants, empathy towards Covid-19 related issues or layoffs, pay cuts or less hours is a must. These are unprecedented times. Most of my tenants paid on time and if we can collect the last few my units this month, it should make things easier for the coming months. There will be more jobs lost, some will have hardships, some just won't pay due to no teeth in the eviction process. I am thankful, my partner and I have good quality tenants. I hope we can continue to help provide housing in the interesting times.

Regards,

@Johnny L. What was your plan for this property? Does your current life make sense with this plan? If so keep it, avoid new closing costs.

If not, then Refi and restart your 15 with about the same terms and for 8k getting 700 less on your payments.

This is a life style choice over a what's the math says choice. Total payments below. Considering nothing else.

2390*12*15= 430200

Math at 3050= 357390 

@Rick Oaks

On my first deal with my dad, I complained about half a point. He kicked me under the table. “I paid points to get 12%.

It’s about perspective. My dad and I differed, now I can tell you now that I would pay more for a rate if it was an easy, no surprises, closing.

Good luck on your journey.

@Spencer Hartz

Find a few banks/credit unions to work with. Build a relationship and understand what hoops you will need to jump through to get your loan. DTI, Loan to value, and credit history will come into play.

@Angela Hagen

Just updating. We closed in August. Start with the bad. Sellers numbers were off. Not terribly but enough that I won’t continue buying from them. A tag along to a tenant took 3 months to be rid of. Washers bought are not making money.

The good stuff. Fully occupied for 3 months. Most tenants are paying on time. And we were able to cross collateral with another property. No down payment. We have a good plan and will follow through with it.

@adam carskadden 

Best advice I can give. Start with an end goal then work backwards. 

Goal-Have a cash flowing rental.

5. Pull the trigger. Buy it. Then the hard part. Follow up. Do the things that will make this business successful.

4. Put a team in place. Realtor, bank/pre-qualify, contractor, prop management, handyman, plumber.

3. Break down the numbers. Find accurate Rents and expenses for the property.

2. Find a property, SFH or MFH. Something you can afford the down payment for.

1. Take action. Make your plan, execute. 

Don'ts. Don't research every rabbit hole. Don't worry if the first property isn't a home run. Don't regret other oppertunities. At least your aren't on the side lines any more. Good luck on your journey.

Not a laywer, not your lawyer, But could you consider the basement a part of one of the units and have roommates? My house in MN, we just finished the Basement out. Added a bedroom and bathroom. I don't have it as a separate unit. I see it as adding it to my part of the house. So instead of a 2/1 it would be a 3/2 with roommates.