All Forum Posts by: Dean Valadez

Quote from @Chris Ayars:

@Dean Valadez I once owned a home that had a similar problem. Each time it rained hard, water would rush down the hill and go into my basement via a too low window well. I erected a brick barrier wall around the window well. Problem solved. Sometimes you have to think outside the box to resolve a problem.

 Thanks for the idea, however, I failed to mention that one of the window wells is along the side of a narrow driveway, thus anything built up around the well could get in the way of vehicles trying to use the driveway. This would also mean that any well covering would need to be flat. I’m not concerned with a cover that would support a vehicle since any vehicle would not get close enough for a tire to fall through. 

Any other thoughts?

Hi All. I have a SFH I am rehabbing to get it rented out. The basement gets wet/damp during heavy rains. I am having a mudjacking company jack up some concrete that is sloping towards the property, possibly causing most of the dampness issues. I also re-sloped the land around the non-concrete parts of the property and put in a French drain. My last line item is to cover the window wells. However, the top of the metal well is currently flush with the concrete, and after the concrete is lifted, will be below the grade of the driveway. Does anybody have an idea as to how to put a window well cover on that? Most covers extend beyond the well and then have clips that attach to the well. However, with the concrete, there is no room for the cover to go beyond the well and no room for clips (since the concrete touches the well)?

Quote from @Tyler Carter:

Quote from @Dean Valadez:

I am curious about this as well as I have a single family that was once my primary residence, I moved out and am turning it into a rental property. If I have it under an LLC, would the deed also need to transfer to the LLC to avoid having my personal name attached?

Dean, yes. If the property isn't financed then that is probably not as big a deal - Check tax implications and know there are other LLC rules to follow. If it is still financed then that is where the issues start in my case. The mortgage holders may call you to pay off the mortgage (refinance) if the deed is moved over to a LLC. Considering a lot of my properties still have sub 4% rates, that is not something I am crazy about at all.

Thanks, Tyler. The property is financed at about 3% rate with maybe $45k left in the loan. I hear some people say that most/many lenders won't care if an LLC pays the loan so long as they are getting their money. As this is my first time doing this, I cannot speak from experience. 

Newbie question: what is the best way to transfer the deed to the LLC? Go through a title company? Are there closing costs associated with that? Go through a lawyer? Same closing costs? DO a quitclaim? How do I do a quitclaim?

Quote from @Jeremy H.:

I did an LLC so I could build a brand - it's to limit your liability, it's really up to you. Not necessary, but easy/cheap enough to do and helps me think of the business as more separate. Also easier to separate bank accounts etc

You don't need to put the rental in an LLC. I personally would transfer it through a title company - costs about $150. Your loan probably technically doesn't allow this because there is a "due on sale clause" but I have never heard of a loan being called as long as it's being paid

My advice to you would be to screen potential property managers, read reviews then set it up to be managed by them. 

Open a bank account for your rental and keep 4-6 months of reserves - could be a HYSA. 

What's your long term goal?

Would you recommend letting the mortgage lender know the LLC will be paying or is it safe most of the time to not say anything and just start paying from the LLC?

Quote from @Kinju Dudhia:

We have used Title company in the past to transfer our rental properties to LLCs.

Does this transfer the deed from one's personal name to the LLC then? Is this necessary? What happens if one does not do this but is paying the mortgage and the other bills with the LLC, and the rent is submitted to the LLC? Thanks for any insight!

I am curious about this as well as I have a single family that was once my primary residence, I moved out and am turning it into a rental property. If I have it under an LLC, would the deed also need to transfer to the LLC to avoid having my personal name attached?

Hi! I've read various ways to go about this, but wanted experienced insight. I turned my former personal residence into a rental and have it listed as such, with occupancy coming up within the month. I also have this property now set up under an LLC. Up to this point, I have been paying for the mortgage out of my personal account, but moving forward, will pay from my LLC's business account. Should I:

1.) Not call the lender and just start paying from my business account. I realize they might want to call the loan due if they see a business paying for it and make me pay the remainder. I have only $45k left on the loan and can scrap the funds together to pay it, however, I wish not since the loan is at 3%, and I can use that $45k for other properties to not pay as much of the 7% interest rate loan I would need.

2.) Call the lender and tell them they will receive payments from an LLC. They might not care since I have been a solid paying customer for the decade and a half of having the loan. Or they might call it due still anyways. Note: this current lender bought the loan from the previous lender, so the current lender has received my payments for about 3-4 years now.

Let me know your thoughts! Thanks much

Quote from @Nathan Gesner:

As mentioned above, you can change ALL the terms of a lease when the current lease expires. 

When you renew a lease, you can change the dates and some of the terms, all of the terms, or none of the terms. You can give them an entirely new contract. It's called a "renewal" but it doesn't have to be the same agreement.

I do not recommend incremental rents. If the tenants are $200 below market and not paying pet rent, bump them up $200 and add the pet rent. If they don't like it, you can find another tenant willing to pay market rate and pet fees.

 Very succinctly said! Thank you. I like the strong position taken. I may blend it with some of the other input here too!

Quote from @Colleen F.:

@Dean Valadez with the cost of utilities going up and the fact that these units include utilities if they are the same size and similar condition you should be charging more for them. So yes you should do the increases. 

When it comes to electric and gas is that heat related? If it is something that is related to heat you might want to use RUBS Ratio Utility billing by square footage.  If they are the same size a flat fee yes would be okay.   

Expect that some people may leave even if you are fair with the charges they may opt to go somewhere new. 

I can't comment on pets but I would be less worried about a smaller pet increase than being under market.

 I like the idea of charging by the square foot. Perhaps a flat fee may not make as much sense since one unit is quite a bit larger than the other. I agree with being less worried about the pet increase and more concerned about being under market. I am thinking that by charging $20/mo for the pet though, and charging $20/mo less for the rent increase (say an increase by $100 instead of $120, for example), I look like I am not increasing the rent 'as' much but am also recognizing that the previous landlord let them get away with no pet fees, which is not industry standard. Thanks for your insight! It has helped me develop how I will talk with the tenants about this issue.

Quote from @Ned J.:

You are starting a new lease with these tenants, so basically you can charge whatever you want, including pet deposits and pet rent (assuming its legal to do that in your state), and increase in rent (again, some states limited how big of a % you can increase it).

Its the balance of increasing it closer to market and protecting yourself for eventual damage by having pets in your units vs inducing a vacancy and starting over.....which can be scary but often its a good thing when you take over someone else's tenants. 

I personally would increase it to within 5-8% of market, collect a pet deposit and forgo the additional pet rent. 

I like that - seems fair. I might swap it around though to collect the pet rent and forgo the deposit. I am thinking that 12 months worth of pet rent will equal about the same as a deposit, and with pet rent, I would keep it no matter if there is damage or not, but with a deposit, I would only be able to keep it if there is damage. Thanks for your input to generate my thoughts!