All Forum Posts by: Donald Robers

@William Huston - Your experiences seem to mirror those of most REI when looking at the property values. Many landlords and PMs have posted that the higher priced rentals draw a more stable and less demanding class of tenant. This is somewhat counter-intuitive to my thinking, as the stereotype in our society is the well-to-do guy that considers himself royalty and makes unreasonable demands. But the rental owners and managers that post here seem to have the opposite opinion when it comes to tenants. Perhaps having more money available promotes a sense of independence?

Demographics of age also play a part in your tenant histories.  It is natural that the couple in their 50s occupying your most expensive property will be more settled and stable than a younger family that may need to change living arrangements due to job or school factors.

So far as wear and tear it is obvious that a family with children will be harder on the premises than an adult couple.  And you will find that generally 2 children will make 4x the noise and damage as 1 child (this holds true for pets as well).  

Now having your property trashed is something completely different.  You are either dealing with anger or resentment.  As @Frank Maratta noted above, thorough screening can help weed out the serial wrecking-balls, but some people are always going to lash out at a perceived slight or out of frustrations that you may have nothing to do with.  Mr. Maratta also noted that about half of his tenants are funded by Section 8.  They have an incentive to be decent tenants lest they lose a valuable benefit, one of much more value than any security deposit you are likely to collect.

@Adam Dudziak - Per the funds seasoning requirement, why is a bank even involved if it is an all-cash purchase? Was the property REO?

@Paul Sandhu - I think my response would be more in the spirit of @Dylan Earl's suggestion.  When you involve the police you have little chance of de-escalating the situation whereas if you start by pretending it might be an innocent mistake you give the neighbor the opportunity to back down and save face ("Oh, yeah, I found it in my yard the other day.  Wondered how it got there.").

If the neighbor comes off belligerent that is the time to back off and get the police involved.  I am afraid that even with pictures and receipts you can only prove that you own a similar grill unless you have a serial number or there are distinctive marks.

Aside from engraving your equipment the best way to protect your property is to cultivate the neighbors; know something about them and let them know who you are.  You always want your property surrounded by watchdogs rather  than jackels.

@Jay Hinrichs - How about this?

Fishing License:

    Buy the license - learn the regulations to lawfully perform the activity.

    Find bait - perform market research.

    Assemble tackle - learn how all the parts work together.

    Cast your hook - advertise your property.

    Set the hook - close the transaction

Pilot's license - You learn that REI, like the sky, can be very unforgiving of ignorance, carelessness and hubris.

@Ashly McGlasson - First, congratulations to you and your husband for achieving as much as you have. One successful flip and a 2nd house renovated and on the market is not a failure by any reckoning. I would venture that most who try REI never get as far as you two'

The problem may be that right now instead of having the worst house in a great neighborhood you have one of the better houses in a poor (or better stated small) neighborhood.

Is your agent advertising outside of your local area?  The Midwest is considered an investable locale these days due to the price inflation on either coast.  Make sure that your property is being marketed to catch the eye of buyers relocating from higher-priced markets so that the size and amenities of your property seems more of a bargain.  Ask your agent about the feasibility of marketing to businesses that may be moving employees around or need short-term residence for visiting executives.

From your post it does not sound as if methods such as lease option or out-and-out rental would work as you want to free up your money.  The classic plan if you intend to pull out of the market temporarily is to drop the price by a significant percentage when you re-market at a later date.  Again, this may not work for you.

I assume that the "hot" selling months for IL, as in WI, are May through August. If you pull out of the market now are you prepared to have the property sit for 6 or 7 months? If so, your current listing contract may have expired and you could try FSBO to save a bit on commission. Not knowing your asking price I have no idea if this would be a meaningful saving.

I know my suggestions are of limited help.  I hope some of the more experienced BP members will weigh in.

@Luis Prieto - You obviously know the situation better than any of us commenting on the situation.  I think that you have every right to feel played, but as many on this thread have advised you need to follow whatever course makes the most business sense rather than seeking emotional gratification (i.e. "cutting off your nose...").  

No idea if you are what @Jay Hinrichs would term a professional landlord but from your comments you have the temperament to navigate a lot of the pitfalls encountered in the biz.  When all is said and done you should follow your instincts.  You will either do the right thing or learn a lesson that will benefit you going forward.

Best Wishes - Don Robers

@Charles Dobens - I think that the reason the responses were all over the place is that there was some confusion over whether or not the OP had an inspection contingency in his contract.  I have read here on BP that there are offers made with no inspection contingency - usually in a very competitive market where it is necessary to make the offer stand out from the crowd.  Since the OP clarified that he did have an inspection contingency the argument now seems moot.

I can think of a couple of ways that a financing contingency could be used to back out of a contract due to physical problems with the property. First, if the financing sought is FHA or VA an inspection is necessary to procure the loan. A serious defect or even a generally poor condition can cause the funding to be withheld. Second, a bank or mortgage company could decline to provide a loan if the property has a defect that would significantly lower the value below their underwriting standards.

How would the lender discover such a defect with no inspection?  The prospective buyer that wants to escape the contract could tell them.

Finally, in WI the seller has to fill out a property condition report as part of the listing contract.  If the seller refuses to negotiate on a problem that was not disclosed I would not hesitate to remind them that now that they have been informed it is encumbant upon them to pass the information to any future prospective buyers or be subject to litigation.  That reminder may coax them into further negotiation.

@Luis Prieto, I think you may be optimistic in thinking that your tenants will sympathize with your decision to sell your property.  As you said, they have taken good care of and in their eyes improved the place (pool and gazebo).  They obviously consider it home.  Ordinarily I would say that is a good thing but it means there will be some resentment when they have to move.  Thus far they have not shown empathy for your situation regarding the rent arrears.  Expect anything from sullen recalcitrance to active destruction of your property.

You did not specify how permanent the pool and gazebo are meant to be, but even temporary structures will leave some footprint that you may have to remedy to show your property at it's best.  The fact that they went ahead with these "improvements" without your prior approval should give you pause.

Full disclosure - I have no idea on the bonafides of this company or the merit of this method, but it seems germane to the discussion of how to turn credit card lines of credit into cash.

This fellow, DBA "Wholesale Tradelines", has various schemes on YouTube. He claims that there are "some" banks that allow you to open an account online, and that these accounts can be funded using a credit card. Then you can withdraw the funds via check or electronic transfer to another bank account.

Again, I doubt that it can be that easy.  If I owned a bank that allowed such a transaction I would limit the initial deposit and have an onerous seasoning period before said funds were able to be withdrawn.  I would also put in penalties to discourage the churning of the account.

But I am skeptical and very boring when it comes to my  financial habits.

@Maureen McCann - I agree we could use one!  Some of this stuff you either have to laugh or cry.