All Forum Posts by: Account Closed

Property managers will make money as follow:

1. Placement services

2. Monthly management fees

3. Yearly inspection fees

4. Maintenance and repair services

My experience is that property management companies mark up the cost of their maintenance and repairs. They either charge a project management fee directly or they just bury it into the cost of the repair. I would just ask them how much they mark up the cost of the maintenance and repairs. Now some property managers don't mark up the costs.

 So that would mean this method the book mentioned will no longer work & is not one of the above methods i mentioned.

Property managers typically earn commissions as a percentage of monthly rent or according to the particular actions they perform, such as finding a new tenant or performing a clean out.

 Yes, you need to look at the amortization schedule and find that point where you will have the required equity to refinance. This includes your down payment, principal paid and appreciation, forced by improvements or increased rents and market increase. 

If you can't hit 20% equity at the end of 3 years, it's not a good deal IMO. 

Additionally, you can consider cash flow, if you can pay yourself a management fee for the brain damage messing with it, additional cash can reduce the principal. 

With this strategy (or any other, like options) you need to be in a position to refinance or sell within 6 months, depending on how fast foreclosures get to a sale due to the due on sale clause. There is a risk and it does happen, so simply be prepared with a plan.

All roads lead to conventional financing unless you're going to sell in the short term. Generally, selling within 3 years, without rehabbing, won't make you wealthy. At some point with "seller financed" deals you need to obtain conventional financing, long term financing. Any long term lender will be going closely by conventional requirements. 

Even getting private money long term needs to be done with conventional loan thinking, you get granny to give you a 25 year note at a lower rate than what should have been paid with a fixed rate and you may well have issues ahead of you. 

Need to understand the difference between purchase money loans and refinancing, sub-to you are refinancing, options are purchase money, installment contracts are a combination of both underwriting requirements. Good luck :)   

You will need to be apart of the contractor selection.  Remember its your money and you get to say how to spend your money.  Depending on the size of the project, a lot of people just try to use a contractor to do everything but this can back fire on you.  If the project is mainly cosmetic you could use an interior designer or an architect.  Either of them will be able to assist you in your needs.  A lot of architects will provide a free consultation to inform you of your options before you start. 

Hey @Account Closed-

Condos have their benefits and draw backs.

Personally you have less liability on you for the condition of the property. However as part of the condo association, if there are issues that aren't addressed or don't have a plan to be addressed, then the individual unit owners are on the hook.  Special assessments can be costly..  So I'd suggest to take a look at everything. Interior and exterior of the building and any facilities.

Also be sure to review their condo budget and plans for future improvements.

Hope this helps!

Is the thing i look into the HOA budget is about the changes of a special assessment, and what should i expect to find in their "Plans"?