All Forum Posts by: Account Closed

Hey guys, 

I will try and summarize the situation quickly.

One of my apartments (5plex) has back office / basement area where we store some of our repair equipment for the property management, such as desk, office equipment, paint, tile, windows, some files, and keys to the 20 units that this particular property manager of mine manages for me, plus other misc items as needed for repair work. This area also has access to the basement of the 5plex which is where the gas meters / water meters are held. I pay all gas bills at this property, tenants pay electric and water. The electric meters are outside. 

Currently The owner (myself), my property manager, the city administrators office (to read water meters), and my repairman have a key to this location. One of my tenants is complaining that I am breaking the law not allowing for full access to his water meter 24/7. This is a difficult tenant, and probably contributes to 30% of the calls that my property manager makes for his property load that he manages for me. 

In place at the moment, we have in a rule that he can request access to the meters Monday - Friday as long as he is accompanied by another team member and this request will be met within 24 hours. One of my workers, the property manager, or myself if I am out there - I check in on my properties at least once a week in person. I will be releasing this memo as it was only a verbal communication when put into place as to cover my butt, and also present the concern to city council on the matter at the next meeting with the memo also presented. 

I want to ensure that I am doing enough, and that I have a leg to stand on here as I stand my ground on the issue. I simply do not want to grant unlimited access to a tenant to an area with thousands of dollars of equipment and materials, and keys to 20 units within a 5 mile radius. Am I in the wrong? Any input on how I can best meet the tenants needs without stepping over any legal or ethical boundaries? Let me know what you guys think! Thank you! :) 

@Wade Fisher, @Thad McNair, yes and no. I did get financing against the property and yes they do pool property together. I had to meet with a commercial loan officer for this to occur as well which my local branch only had every Friday - if you pursue this, they may not be in everyday dependent on the size of your city. This had a multiple property pool against the total appraised value of each property listed. A recent appraisal had to be completed per unit. (6 months recent from a third party) The seasoning requirement is one year though which makes this unattractive to most flippers / buy and hold investors who want to BRRR the process and not endure the holding costs, I think it may be more attractive to experienced buy and holders who have property already beyond the Rehab stage that is stabilizers The terms I had was a 20 year am schedule LOC 3.99% with an LTV of 70% against the pool of properties owned free in clear listed in your schedule of real estate.

What threw me was that this was through the commercial officer, but the pool only included 1-4 unit properties. I did not structure this or ask to include the 5+ multis in my portfolio and honestly found those much easier to get financing on through my local credit union - Hancock Federal Credit Union.  

Dave, 

Thank you for taking the time to answer my question! That makes sense all around. I appreciate it sir.

Quick question about record keeping. When you ladies and gents have a new appraisal done, do you keep the records of the old appraisal? Example, I had a recent appraisal done at the purchase of one of my flips and it came back at 34k we paid 30k put 32k in it and it was just reappraised at 84k. Now do I need to hold on to both the old and the new, or can I just keep the new? Please let me know what you guys think, would do, or have done. Thank you!

Darrin, I cannot speak to straight partnerships but I have had a few investor colleagues who have worked in an LLC partnership with defined roles in Ohio. After 4 years they went on to pursue different things and it was very easily dissolved with one of them forming a new sole proprietor LLC. Now under this situation it was an amicable dissolution, but they sought out the LLC portion for income portions as it gave them the opportunity to flow income through their rentals and flips on there own terms through their personal tax filings. It would also depend on how you would be structuring responsibilities, liability, and profit. I've seen this model be successful, my biggest piece of advice though would be to clearly define contingencies for things that could go wrong. A partnership works until it doesn't.

@Andrew Michael thank you! It was a challenge but it paid off in the end! I hope the deals keep flowing on your end as well!

Alright, ignore the low numbers, I invest and flip / buy and hold in Ohio. I follow tax and sheriff sales in my local counties in northern Ohio. When I see something announced for sheriff / tax in the local papers I dig in deep to find the owners info. At that point I approach in person and then see if they'd be interested in a short sale. Anyway I just completed my 6th time doing this. Property was in Tiffin, Ohio - Commercial building storefront with a 1 bedroom rental unit up stairs, I bought for $8,000 put just shy of $6,000 in it for $14,000 sold the property for $40,000 walking away with about $22,000k profit after transactional costs and such. I just want to say that the biggest factor for success in this deal was the language barrier. The owner was of Indian descent without an oz of English speaking. My day job is that of a nurse at the local hospital, I asked around to find translation services through the hospital and paid an interpreter the $50 per hour to help us through this process. I know it sounds annoying and like a hassle but to me it was worth the footwork for the profit. Here's to searching for the next one! For my Ohio Flippers, don't forget to winterize! :)

I do not charge a deposit but rather charge $50.00 a month for having a pet at the property. I also explain when reading through the lease with new tenants that they are responsible for any damages their pet may cause. I also do not take on any tenants with dangerous breeds per home owner insurance. It's seemed to work thus far.

Hey Jon Joseph that's pretty good at $12,000 a unit in Columbus I imagine? Which part of Columbus? And is that from current tenants, any work needed? Terms left on leases? I guess essentially what's the rest of the story? Have you looked at other financing with a longer term to allow you to be in the black or cash flowing sooner rather than a 5 year time table?

Calvin Niese welcome! I invest / rehab then buy and hold primarily in the Tiffin / Findlay / Fostoria market so in Ottawa we're practically neighbors! Welcome aboard. How far does your business reach? We should connect!