All Forum Posts by: Christopher Pound

Hi @Yair Tapia

It's stabilized for the most part. I have no big complaints.

I have found them to be less communicative than other PMs, and their portal interface is a bit dated. I have to sit on them from time to time to get answers to questions. However, for the most part things are running smoothly, and income is pretty consistent.

Not the best; not the worst. Pretty average. Nothing that would warrant a PM switch as of yet.

Thanks everyone! That's what I was suspecting.

Hi everyone!

I've owned 2 Detroit rental properties for about a year. I'm thinking about selling one of them to fund the down payment for a FL duplex.

I'm wondering if you would use a 1031 exchange for this type of situation:

• Purchased all-cash for approx $62,000.
• Rents monthly for $850.
• Thinking of listing for high $60k, low $70k to keep the rent/income ratio over 1%.

I know that I would really not need to 1031 if I break even (no capital gains). Was wondering your thoughts on 1031'ing if my gains are in the $5k-$10k range. Worth it for the hassle, or should I just absorb the gains?

Thanks!

Thanks, @Chris Mason.

My lender rep told me the same when I asked about using HELOC funds in the recast. Obviously good concerns to have.

My thoughts on using the HELOC in the recast was to lower the monthly payment of 30 years worth of amortized payments, while working aggressively to pay back the HELOC as quickly as possible. Essentially this would be akin to using a HELOC in a similar manner as a truth-in-equity hack. In other words, I'd rather have 30 years of lower monthly payments and a couple years of working hard to repay the HELOC, than have 30 years of higher payments and no HELOC.

Perhaps my thinking is fundamentally flawed, though...?

Well here is what I found out so far...

I can recast 1ce only throughout the life of the loan. I can also open a HELOC and use those funds in the recasting process.

My understanding how it works is that I would set aside any extra funds I want to use in the recasting process in a separate bank account. When the times comes I want to recast, I would communicate with my mortgage lender and let them know I want to recast. They would then let me know how to apply the funds I've set aside to lower the monthly payment after the recast. Once it's done, it's done.

What I don't want to do is take my extra funds and immediately pay off principle on the back end of the loan, then expect to recast based on the new principle balance. In that scenario, there would be no funds to use in the recast process... rather, I would simply have a lower principle balance with the same amortization. Essentially there would be nothing with which to recast.

When the time comes I actually am ready and do recast my loan, I'll follow up here if the process is different than my understanding that I've outlined above.

Hope this info is useful to someone. ;-)

Hi everyone,

New investor here, relatively new poster, longtime lurker, lover of all things RE. I have a question about recasting of a mortgage loan, for any of you financing experts out there.

Acquired my first 2 rental properties last year, and the original plan was 1 property/year to start out. After running into some financial issues, looks like my 2019 purchase is my own primary residence. We're downscaling into a smaller home, which we picked up from another investor who got it as a foreclosure. It stank =) but we're really fixing it up nicely.

The plan is to hold 2 properties for a couple of months (mortgages on each) until the timing is perfect to sell our current primary residence which we'll put up starting sometime in April. Also gives us some time for rehab on the new one. To facilitate this, we got a mortgage loan that can be recasted. When we sell our current home a couple months from now, we'll put any profits into recasting the mortgage for our new property, with the idea of making the monthly payment as small as possible.

My question is this...

Any thoughts on getting a HELOC on the new property, using it to immediately pay down the mortgage loan on that property, then recasting that loan on a much lower total? I'm not very familiar with how recasting works, so I don't even know if we CAN recast it with a 2nd taken out on the property. My thought though is that with a much smaller monthly amortized amount on the first mortgage, we can pay down the HELOC pretty quickly then take advantage of lower monthly payments for the next couple of decades.

Whatcha think? And thanks for taking the time to read.

Thanks for the input everyone! These are my first investment properties, so I want to make sure everything is on the level.

I did just receive the March rents (minus $900 for repairs), but still not February. Still trying to get answers.

@Brian M. thanks for the response.

It was actually pretty smooth. They treated me well, and kept me in the loop during the rehab process. The first property took about 4 months to rehab, the 2nd took about 3 months. I have before and after photos of each, and they look nice. The individual I worked with to buy the properties is no longer with Morris Invest, but he was fabulous!

In all, the properties were ready for rental about November 2018, and the Principle Property Management took the first month's rent as the tenant placement fee. I saw a full month rent from the first property in January and a partial for the 2nd property.

At this point, I thought everything was set and that rents would be pretty regular. It was at this point, though, that Principle PM merged with Suite Properties, so I guess some things got fuddled up. I did get a note back from my contact at Suite, and she mentioned that it was initially thought I owned a commission on one of the properties, but upon closer inspection Principle paid that commission to Suite, and/or it was billed improperly.

Essentially I'm still in a holding pattern waiting on Feb rents.

To answer your questions:

• There was renovation that took a few months. All is done now, and I have final pictures of each property. My understanding is they had renters ready to go as soon as they were done.
• I did not visit the properties before or after. I've not seen them in person.

TBH, my experience with Morris Invest was overall very positive. I've now been passed on to the PM company(ies), and I think I'm just caught up in the administrative red tape of a PM company acquisition/merger. *sigh

Hi everyone. Longtime lurker here ;-). Love this community though, and all the resources BP shares.

I was curious if anyone has ever used a PM company called Suite Properties out of Detroit. I purchased 2 turnkeys from Morris Invest last year, which went really well. They handed me off to a PM company called Principle Property Management, but they soon merged with Suite Properties.

The reason I'm asking is that my rents from Feb never came in. I inquired and apparently the tenants paid on time, but the PM company as of yet hasn't deposited funds into my account, which they do approx mid-month. It's almost time for Mar rents to come in, and Feb so far is a no-show. They told me the accounting guy is a bit behind, but would hopefully get caught up by the end of last week. Nothing yet.

Anyone have any experiences with them, good or bad? These are my very first 2 rental properties, so maybe I'm just being overly cautious?

Thanks!

Phrish