All Forum Posts by: Brian R.

Talk to the case worker.  If she did leave, and HUD pays you for the future, then finds out the tenant had left, they can, and in almost all cases, will come after you to refund the money they paid you, and can take legal action against you for accepting the money if you knew they were gone. 

Thanks for the input.  As I said in the original message, if it sounds too good to be true, it probably is.  I will not be contacting him again.

I have been looking at options to purchase another property, but won't have the normal 20-25 percent for a conventional loan for a little while. I saw someone reply to a Facebook message that he is a private lender, and he will lend 100 percent of the purchase up to one million dollars, over that is 85% LTV. I sent him a message asking for some information, as it intrigued me. He sent me a response back with some information. I would like some others perspective, because if it sounds too good to be true, it probably is.

Here is the response I received with the requirements:

1.  Borrower must have an active bank account

2. Borrower must have an active identification (drivers license, passport, etc)

3. Borrower must show two months bank statement to prove income

4. A signed purchase agreement on the property

5. First payment due in two months

6. No early prepayment penalty

7. Interest rate of 5%

8. Loan term of up to 30 years

9. Loan amount of $10,000 to $10,000,000

10. Upfront loan origination fee of 1.5% must be paid when approved for funding.

Like I said before, all the terms sound OK, but the way number 10 is worded, I would have to pay them the 1.5 percent before they put the money in my account.  Will I ever see the loan is my concern and be out the 1.5 percent. Is this a scam.

I want others opinion on this. I can't find anything on-line with his name. He included his phone number in the e-mail, but that number does not come up with anything when I search it on-line. I found a business filing with his business name (an LLC) with the SOS of California that expired the middle of this year. The address associated with that listing comes up with a CPA firm in California. I am going to call it and see if they know anything.

I have never been involved with private money financing from someone I don't know, so I want to be careful if I was to go forward.

Thanks

As someone who works for an ISP, DON'T DO IT.  The tenants will not be able to contact the ISP if they need help, unless they are listed on the account as well as you. (I have to go through training on that every year, and the federal laws associated with that*)  If they download something illegal, your name will be associated with the IP address that was used, not the tenants.  You will be the one in court.  If you are charging tenants for the wifi, it may be against the terms of service for your account.  The ISP finds out, they can shut your service down, and not provide service to the address. 

*I just realized you are in Canada, so I can't speak for Canadian laws

@Nathaniel Wenner I ended up getting outbid of the property, so I didn't buy it. I ended up buying a property in Madelia instead, and my property manager is out of Mankato.

I am assuming you, as a manager of the LLC, are applying for the permit to do the work, but you hire contractors to actually do the work.

I would require the contractor to get the permit themselves. 

Where I am, even if the property is in my personal name, unless it is my owner occupied property, I can't get a permit to do work on it. I have to hire a licensed contractor to get the permit and do the work.

The other option is for you, as a manager of the LLC to get a contractors license for the LLC, and then you would be "legal".

I don't know costs for the contractors license in your area.  About 2007 I got my contractors license, and it cost me about $500.00 for the two day class and the test.  I had to go through continuing education every year after, but I only needed it for the one year, so I didn't renew it.  

I just read a local article from a local commercial property owner about this.  He said a letter he received from the chief financial officer of Caribou Coffee that said they would only pay rent on 5% of 60% of February sales, a letter from CorePower Yoga, they aren't going to pay rent, and someone in the comment section of the article said they received notice from Subway they weren't paying either. 

The yoga studio is currently forced to close, however the other places are still open for takeout and drive-up service.

Were they cooking it, or just using? 

Someone I know had a SFR that the tenants were cooking it in. After the sheriff office was done arresting everyone, the owners had to completely gut the entire house to the studs, and rebuild. Tests had to be done on the studs in different areas of the house. The tenants had been pouring liquid waste in the yard, so they had to put ground water monitors out. It ended up costing them close to $100,000 to comply. The state health department had to sign off on everything. This was a house the owners had planned to move into. They had been trying to manage it from California, and the property was in Minnesota.

Depending on how severe the contamination is, you could be in for some large expenses.  In their case, insurance wouldn't cover any of the costs.

One city I own property in, if the fire is bad enough that it needs to be boarded up, they call the company, have the work done and the company they use charges you for it.  You don't have a choice in the matter.  If you don't pay that company, the fire department will pay it and place a special assessment on your property. 

Pay the bill, and move on.

I found this document on the city website. It is an older document (from 2012), but at one point they were really watching for single family homes that were turned into rentals, and not registered.

https://www.garlandtx.gov/docu...