All Forum Posts by: Jeff Bridges

 Get connected with an agent from National Insurance Brokerage from NY (I have never used them before, but I have used an independent broker and they are worlds better than a rando call center agent writing up a quote on a new policy). They are an independent brokerage In Islandia NY and use Travelers, foremost, hartford etc. like others suggested above. They can shop around for you and tell you your options for coverage. Ask lots of questions. You might need to switch over all of your insurance policies with them like your umbrella (definitely get this too and ask them about this as a landlord) and auto insurance, but its totally worth the hassle of moving your other policies. Your premium quotes will be much more competitive than you received. I ran into the 4 rental policy limit on many of the smaller providers that you wont have with a independent broker that can help you scale up in the future. Good luck!

https://nibony.com/carriers/

 Duct cleaning is to help with allergies, but its a waste of money to resolve improper temperature or other HVAC performance issues. Sounds like they were looking for an out and the HVAC provided them with one. You should also verify proper operation of the system once they move out... Skip the duct cleaning as that doesnt get you closer to the root issue which is heat and cool performance for both floors.

I have an option to do a cash-out refi for a penfed 10 year balloon (3.875% interest, 30 year amortization) or a 30 yr fixed with a mortgage broker(4.75% interest) for my BRRR method strategy for a SFR rental. Payment is $470 v $522. The 10 year balloon nets $6240 less interest over the 10 year period. I plan on long-term buy and hold, but not sure if I would be selling close to year 10 and re-positioning. This property would net me $500/mo cashflow after debt service with the 4.75% 30 year rate ($558/mo cashflow with balloon). Cashflow is more than adequate for both loans so I wouldn't be in a bad position with either. I know I could refinance the loan at year 10, but the risk is higher interest rates at the time. the refi costs would still be less than the $6240 saved over the life of the balloon loan. I'm thinking that rates will be higher in 10 years, so I'll just end up paying more in interest over the next loan term if/when I refinance vs sell. small likelihood I might sell and reposition in 10 years (1977 property).

Any thoughts for or against each option? Thanks in advance.

@Jon Holdman had good advice re: items you should itemize on the bill/letter to send to tenant demanding excess after subtracting deposit. That's a must. In addition to the mailing tip for the tenants he proposed, you might also try texting/calling either tenant that used to be your friend and asking where they want the deposit to be mailed after deducting any damage. If they are expecting their deposit to be returned, they might provide an address. Send them the itemized letter and be done with it. Or if they don't respond, you now have an address where to mail the certified mail summons for small claims court if you choose to go that route. Looks like you're chasing 1950 after taking the deposit? up to you if thats worth your time in small claims court with mixed results in recovering funds. You can get a judgement but getting the funds returned will be more headache depending on the jurisdictions process. Focus on cleanup and re-rent to reduce vacancy time as that will guarantee you more immediate income than you might ever recover from your prior tenants.

Are you talking about in reference to taking cashflow as income to use for living expenses? I personally average out the repairs I would expect over the year based on how old items are within the house and understand that I cant anticipate what month each item might break down, so it would be foolish to take a single months expected repair cost as cashflow, when a repair could come up in november for 900 (I had a HVAC compressor need to be replaced) when I budgeted 1000 for annual repair costs. But as far as budget planning, the priority should be establishing 6 months reserves first for each property including repair budget, then you can take your budgeted cashflow. This way you are not expecting to have to cover a repair from personal expenses when a single months rent wont cover that repair that pops up. You can reassess at year end to see if your repair budget needs to be adjusted for next year and take additional cashflow then if repairs were mininal and your reserve fund is funded adequately.

I would talk to @Zach Zander for feedback on townhouses in that area.

I'd point out that some of these communities are beginning to deal with deferred maintenance to common area like repaving the private streets that make up their entire communities. Thats not a county responsibility. In the below case, watergate assc. took out a 140k loan to re-pave their streets after getting help from councilmembers to get a low interest loan. There are some risks to owning in these associations and  possible association special assessments to owners that may follow. So besides normal tenant quality risks, you have to consider the lack of control over the association and management of financials that could increase your expenses and hurt cashflow.

http://www.baltimoresun.com/news/maryland/harford/...

There are some of the articles here that are important to reference with regard to violence in the area several years ago that I'm not sure are still applicable:

http://www.baltimoresun.com/news/maryland/harford/...

http://www.baltimoresun.com/news/maryland/harford/...

I agree that negative cashflow makes this a good candidate to sell. You say you have 90-100k in equity built up. That allows you to walk away with 90k cash minus roof replacement/commission/settlement costs. Seems like a good amount for you to reposition your portfolio and find a property with good cashflow given the new knowledge on deal analysis you have learned from BP to make better purchase decisions. If you were talking to your stock broker about repositioning your stock portfolio to find something with a better chance of return, they would be giving you the same pep talk about selling the dog and find better options for your stock portfolio. The market is doing well, so you're most likely to get top dollar and sell quickly. Now about the roof, it sounds like its in bad shape and not something you can kick the can on to your buyer, whose inspector/bank will definitely notice and make you address ASAP. Your best bet is to seek additional bids on the roof repair (get 2-3 more bids) and see if you can get that roof replacement expense down from 11k.  That seems unusually high unless the hurricane has roof contractors busy and created some artificial price increase lately. Not my market so I cant eval pricing. Once repaired, put it on the market. maybe consider some strategic but low-cost upgrades like paint/flooring/backsplash/ inexpensive bathroom/kitchen upgrades to make the unit  pop and sell for top dollar (get your agent to make some recommendations on what they think would make it pop in your market). good luck!

how about you ask for a 2nd portable unit or window units for one/both of the bedrooms? You cant make the compressor component ship faster from the vendor which they have no control. I've gone through this before as a landlord. Service company goes over and diagnoses the unit, but doesnt call owner or Property manager about the results. PM finally calls to see whats up and then they finally agree to order compressor. Compressor always takes 3-5 days to get shipped. then schedule the repair 24-48 hours afterward. Things don't always come together perfectly. If its going to be another week, window units should be satisfactory. good luck.

Ah. You might be best served by a licensed/insured roof contractor. Just let them know you are looking for a flashing inspection and repair for a roof stove/microwave vent that might be letting in rain intrusion. I've had good luck with Thumbtack app or website to solicit bids for a specific repair. Gets responses from several vendors quickly so you can compare bids/ check out contractor reviews from previous jobs. Might also need bids from a regular contractor to help you with the interior water damage. Some companies do it all but not all contractors have or maintain roof liability/ workers comp insurance to do roof repairs. It has a higher premium due to higher injury risk. Just something to be mindful of...

Is it an ammonia type smell or a mildew/mold water smell? I had a mouse infestation in a kitchen once and they pee all over to mark their territory and to help them navigate because of poor eyesight. They camped out below the stove and behind the cabinets. Needed to pull out the stove and pull the base cabinets and have them sanitized and deodorized. Also used lots of "natures Miracle" spray bottle which neutralized the urine/odor using enzymes.  Let us know what you find out regarding the smell characteristics so we can help better.