All Forum Posts by: Calvin Thomas

Hi all, my wife and I, after many years of analyzing, finally purchased an 4 unit apartment in western NY. Now that we are deep into the winter months we have noticed our heating bill (gas) continue to go up, our latest bill is over $400. We have a single boiler system with four zones and looking for advise or suggestions to lower the gas usage.  One thought was to move the thermostats from the apartments to a single conditioned space and place temperature monitors in each unit to make sure the apartments are at a comfortable level. We are not sure if one apartment or some are leaving windows open of if something else is happening. We have sent letters to each tenant asking them to be mindful and, if needed, to let us know if they have a maintenance issues with a window or door. Has anyone done this? Is there any other suggestions you may have?

Thank you

Jim 

Assuming you go the HELOC route, another option to reduce your costs assuming you have decent credit is to look at credit card balance transfer promotions.

Back in 2003-2004 I had HELOCs on my investment properties and interest rates were increasing. I was also getting credit card balance transfer offers at 0% promotional rates for a year to a year and a half and I started transferring my HELOC balances to the promotional credit cards. It saved my quite a bit on interest costs. Short term my credit score did take a hit, but once the promotional transfers were paid off, my score jumped higher than it was before.

These days, the "pure" zero percent transfers don't seem to be around anymore as they typically charge a 3-5% balance transfer fee as part of the promotion, but this is still better than current HELOC rates. Obviously if you go this route you need to be very attentive and make sure to zero out the credit cards as the promotion ends. It is something you don't want to try if you are not sure you have the liquidity to make this happen.

Does anybody have recommendations on the various alternatives to requiring a full security deposit?

I know there is surety bond process and there a a few companies that appear to offer a service (Like Rhino)

Furnished Finder has a new feature called Worry Free Waivers but when I tried  to better understand their process, it was clear they have not done a good job of vetting this out.  They have outsourced the entire process to WAIMO which appears sketchy. 

Full security deposit for a three month MTR is causing me to lose business and I need an alternative!

Options - collect full payment for the 3 months up front and lower the deposit to secure against damages only, require insurance. Let them pay the deposit with a credit card. Collect first two months rent up front and deposit on next month. 

None really reduce the amount of money they have to come up with, but if they are broke as a joke do you really want them as your tenants?

Hi all! Just digging in to this forum and learning a lot. 
Have recently started a renovation company with a friend, both of us successful business owners and talented in the trades. Also both enjoy freedom in our schedules. My question is, for a fix and flips, I'm considering financing the whole thing with a HELOC instead of hard money. I have 100% equity in a home valued at about 400k. Secure income from a thriving business as well. My partner is considering the same on his home, however, he still owes about 100k with 300k equity.

Is this a wise strategy? Is there another way I should be considering? Thanks for any and all advice!!

I purchased a fix and flip that got complicated when we found one of the basement walls was bowing in. It ended up being an easy fix, getting steel braces installed for about $6000. Then things went south...

I decided to gut the rest of the basement since it got water damaged from the foundation issue. I noticed quite a bit of mold growing up the walls, but didn't think too much of it. The day after I gutted the basement I got really sick. I was dizzy and off-balance for weeks following. A couple months later finally starting to feel better.

That's when I called in a professional mold remediator. Long story short, his crew blasted through the job in a few hours and the clearance test failed. I asked if there was anything else we could try, he got very angry and demanded I pay him in full. After a few nasty emails and him threatening to sue me if I left a bad review, I paid him in full, $7000 and moved on. Worst contractor experience I've ever had.

I then hired a second remediator. They pointed out all the things the last company did wrong, and gave me a quote for $4000. I had a better feeling about this contractor so I hired them. Just received the clearance testing and still have "slight mold elevation" in the basement, still indicating Stachybotrys and a couple other bad types of mold. Not the clean report I was hoping for.

The numerous remediation attempts and testing have wiped out my profit on this flip. Now I'm just trying to get out. Anyone with experience that can recommend a path forward?

Ok, to those who think % base assures a PMc will "make sure property is leased" you are wrong, and I will explain why and the reality of what it does. 

A flat-fee PM has MORE incentive to get a property leased than a % PMc. Yes. Because the simple math. What is $109mnth? It's diddly-squat! And in contrast, COMPLETING, keyword completing, a NEW Tenant Placement brings about 1 full month's rent, for the tenant placement fee. 

So, which is the most incentive? Getting $109 for doing nothing and watching paint dry. OR 1 months rent for a Tenant Placement fee? Say $1,750? 

What REALLY happens when a PM get paid % of rents, for incentive, is the PM is more incentivized to keep BAD tenants in place who are paying. Especially those who have the nerf'd TP fee. 

Property damage, excessive wear and tear, but paying, that PM has an incentive to look the other way, don't they. 

A flat-rate PM fee incentives keeping things as SIMPLE and EFFICENT as possible. That is done via placing the highest quality tenant possible, keeping issues to absolute minimum, keeping maintenance and service calls to minimum, because to make it work properties have to operate on cruise-control. That's only achieved with QUALITY. 

So the whole idea that $109mnth is some "big incentive" to do nothing is just FAKE-NEWS. It's not. 

But it is a heck of a lot of incentive to do whats BEST in interest of a Landlord, which is getting high quality tenant with low occurrence of issues that operates on cruise control of consistency and quality care of property, for a duration. 

% based, it's just about getting bodies in and keeping them in, and that's done by taking the first most desperate trash off the street who says they'll pay. 

Flat rate vet's the snot out of people to assure QUALITY. Because it has to, it's operating on a razor slim margin and can't afford the issues. 

Just like the Landlord. 

Lol, yeah what do I know I only manage 1,500 odd SFR's.