All Forum Posts by: Derek Brandi

Understanding where she is coming from is key. A vacation home for the two of you is what you have not a rental. When you rent out the room the the student her privacy is compromised and perhaps the reason of owning was to get away from the monotony of the the day to day in your current town/residence.

I don't think you will get a lot of feedback here because every persons different and if your dead set on doing this your going to have to sell it to her. What closes a sale for one person is different that what does for another.

Perhaps sell it.

I don't buy vacation property for myself or time shares etc because I would rather buy another rental and then if I want to go on vacation there are so many fully furnished lake houses or mountain retreats out there the list is endless. (I also don't go on holiday as much as you)

Either way - Good Luck

@Jason Jones 

I had the same issue with a unit in one of my triplexes 6 months ago. We had a tenant that moved in a roommate to help pay rent etc and 2 weeks after we approved his move in all of a sudden we are hit with the bed bugs issue. Now its fairly easy to say "well we didn't have this issue before you moved in" and try to make the tenant pay for the extermination. Unfortunately it its extremely hard to pin point this on one person or event and under law it is my responsibility to provide the home free of an infestation. This problem needed to be handled swiftly to prevent spreading to the other units.

SHOP AROUND. 1st quote Orkin 2000 per unit for the first visit and for any visit after that ONLY 1000.

I called a few other exterminators and found a local company that would do the whole complex for 600 dollars and any treatment after that for 300 dollars a treatment. I negotiated with the exterminator to include standard spraying of the exterior for pest as well as the bed bug treatment for the entire complex.

I also advised my tenants roommate on throwing his mattress out since these bugs were isolated to his room.

I have not had a problem since.

@Nathan Click -Thanks for the info. With commercial lending does the bank view the DTI the same as when getting a traditional loan? I have been told that traditional conventional loan all mortgages count toward DTI.

Hello All!

Hopefully I can get some pretty solid advice. So my career in REI is almost at a fairy tale level. Everyone is paying and have not had a lot of issue except some bed bugs! I seem to be able to find some pretty decent deals for my buy and hold strategy that instantly cash flow. Right now I buy and hold duplexes and triplexes but am also open to any SFH-MFH that makes sense (and if I can get it!)

Hitting a wall. I acquired another multi family property and my banker is telling that loans are going to get increasingly harder to get without going commercial or having some private investors. My pride showed its ugly head as I nodded in agreement like I knew what she was talking about.

I like the stability of 15yr/30yr conventional financing and am not fond of the commercial arms. I have never used OPM for anything in my life so I do not really understand how that works.

Long story short I believe I have an investor that is willing to loan me at 2pts upfront 10% interest only/mo with a balloon of the balance at the end of loan.

I would only do this if I was certain that I could refinance the property and pay the PI in full with out any hiccups.  If iit is set up as a personal guarantee and the lender does not require a mortgage does the refi work the same as Freddie and Fannie loans such as how many you can have and the rules applied to them or is it different since I would have the collateral to loan against?

Hows everyone else doing it?

Trying to maintain momentum and as some people have 30 40 or even 100 properties - I cannot see them putting 20 percent down and getting another loan for everyone of these to acquire them.

All my properties right now are small multi-family duplexes or triplexes. I am not opposed to anything really but in my area the multi-family cash flow much better. SFH tend to keep tenants longer but I find that being a good land lord keeps the renters in place longer no matter the property type. If good deals were easy to find everyone would be doing this so have a little patience and keep looking. You may have to cast a wider net.

I use Buildium and can accept debit and credit cards as well as Echeck. Buildium is more of a management software rather than just a straight paying option but it may be viable if you have several units. The main feature I love about Buildium is the constant contact. My tenants get statements auto emailed at the end of every month as well as reminders for missed payments, late payments, late fees, and much more. It really eliminates the need to hear excuses about forgetting about rent or anything else. It works like how a credit card or any other online bill works in which I become faceless. Fees and notices are not questioned as I simply state one time - "its not me in control of it. Its the software and accounting" and they always pay.

@Ashley Schroeder I use Buildium. It is web based software that is updated frequently - click the name to check it out. 

There service is not free so it may not be viable unless you have some units for it to make sense. I manage my own properties instead of using a property management company so the cost for me makes sense.

But there are tons of other paid and free management software out there.

just google rental property management software and you will find tons. Cozy, Quicken, rentpost, appfolio etc.

Buildium allows me to enforce rules without being the bad guy and lets me collect payments in the form of electronic check, debit card, credit card or good old fashion cash. If you have questions about it let me know I would be happy to help you.

@Ally Kumar The amount you charge is generally relative to the amount you charge for in rent. Certain areas have limits and restrictions on how much you can actually charge for a late fee. Best is to check with your state tenant landlord laws. I rent to lower and middle income so my policy is 5.00 dollars a day. The first week grace period the five dollars is waived until the 9th but on the 9th $35 is charged and then its $5 dollars a day going forward. This scales to your property as a 1500-2500 a month rent would be obviously be a higher fee. Today is a digital world and most people have a smart phone and can get emails like a text message so I find it beneficial to use software that can auto email statements, receipts, notices, late payment warnings and fees.  The software takes the human emotion out of the equation and tenants react to it like they would getting a bank fee or credit card fee which leaves little room for the typically excuses as well as having to deal with them. I do explain the lease in great detail with every tenant and there are repercussions for not paying on time other than the fee. Example being if a tenant pays on the 8th every time while they do not get a late fee they are still considered late which reported if used as a future reference. My system is not for everyone but if you have adequate cash reserves it works pretty nicely.

I looked at it like most mortgages work where its due on the 1st but not technically late until the 15th.

 If paid after the 9th the fee is retro to the 1st. I rent to the lower to middle income levels that have a hard time managing there bills which is what the tenant the OP mentioned reminds me of. Most people in my area are paid bi-weekly and are living paycheck to paycheck. This works for me may not for you.

I have a nine day grace period in all my leases. That being said nothing deviates from the lease as I feel I am more than generous with my grace period. People tend to pay late when there bi-weekly paycheck falls on a certain Thursday or Friday of the month. Having my grace period allows me to be flexible while still enforcing a strict lease agreement. My late payment is a daily fee but the grace period allows payments up the the ninth with no penalty. On the 9th rent is officially late and the daily amount is changed from the 2nd to the 9th after that each day is the daily amount. Our software emails the tenant every day its late so keeps the reminders going. We have very little issues.