All Forum Posts by: Don M.

I just want options. That may mean leaving a W2 job. It may mean transitioning into more passion-related work. It might mean early retirement. It might just mean having extra spending money. I'm not sure yet, but what I want the most is flexibility and options.

3 Votes

@Trevor Fleck
Congratulations! The property looks great; I was excited to see it go under contract the other day. I appreciate your encouragement and insight in regard to the area and R2R late last year and since that time. Your success with this build definitely keeps me motivated through the grind of the permitting/construction process. I'm eager to see your continued success in Cape Coral and where it takes you.

2 Votes

Cape Coral, Florida

Quote from @Kristen Whiddon:

I learned some very tough lessons with R2R. I was under contract with 2 properties in Kansas City, MO. One fell through due to not being able to clear the title, which ended up being a blessing. I started the process with them in August 2021 and closed on a single property in December 2021. The delay was due to rehabbing the property- which I was told and understood. Even after rehab, the appraisal came back low, and we split the difference on price and moved on. They had a tenant in place prior to close and I received the pro-rated rent for December 2021. I signed all contracts with the PM company they recommended and noticed that I didn't receive any sort of deposit in January for rent. Long story short I never collected a single cent of rent on this property. Never once did this tenant pay rent. Also, the PM company failed to ensure that the tenant had put the utilities in their name. (I now ensure this is done myself) So by February I was on the hook for a 380 dollar delinquent water bill from KC water due to my name being on the deed and had no recourse with the tenant. I finally was able to evict the tenant by April/May 2021 after lots of legal fees. After taking possession of the home I see that my "rehabbed" house is completely trashed. Appliances ruined, Holes in walls, fixtures removed, etc. I spent about 12k rehabbing it and sold it at a 16k loss (not including rehab costs) just to move on. I have 6 other rental properties so this is not my first rental or first eviction.

I don't necessarily believe this is on R2R, but wanted to share my experience.

Takeaways for me:

1. Just because you get pro-rated rent doesn't mean they are paying, or have ever paid - don't let that give you a false sense of security -tenant was placed in November so I didn't ask for rent history (My fault)

2. Bigger PM management companies doesn't mean better. I use a small company for my other properties and they have been fantastic. The one here used a call center and I never ONCE was able to speak to my PM, only their assistant or representative from the call center even when things weren't going well.

3. Having people in place that you trust in turn key investing is everything. I'm no stranger to investing out of state, and I assumed incorrectly that this would be similar to my previous experience.

I wanted this property to be my first of many with R2R, but it just didn't work out

To follow up on my previous post:
The company that I purchased this property from has been removed from the RTR network since this was some time ago.
Also, during my experience, I did not reach out to anyone at Rent to Retirement to make them aware of the situation while it was happening.
Now that they are aware, they immediately reached out to me to come to a resolution.
Lastly, the majority of my issue was a non paying tenant and while R2R had nothing to do with that they still wanted to reconcile everything with me to ensure my experience was a positive one

Good to hear. Anything I've read through many, many posts of R2R is they are quick to intervene, problem solve, and work with their clients, even regarding issues that are no fault of their own. While I am still in the stages of working on new construction through them, and can't 100% vouch for what will come after that process, I remain confident in their support. Thus far they have been a great team, outside the team for the individual property. I wish you success with your property!

2 Votes

@Patrick Bavaro

Great news! Congratulations and good luck.

1 Vote

@Cj Powderhorn @Mekail Grant
Thank you both for your input!

1 Vote

Cape Coral, Florida

@Arjun S. Thanks for the info. Was that through one of R2R's recommended lenders? Smooth process other than the rate increase?

0 Votes

Originally posted by @Arjun S.:

Originally posted by @Don M.:

@Arjun S. How is it going now that you're further in the process? Any updates? Was the overall quote with R2R originally in the 275k range they currently have or was it lower when you began?

Thanks

Hello Don,

It was lower originally and I believe every 30-45 days prices went up on the site. In my case it was 266K (vs 238K that it should have been based on original discussions and contracts). So far still waiting on permits and ETA for completion was around Nov/Dec i.e about now. But new date is sometime mid next year. However there is no firm date since it depends on when permitting is approved (which I see is the case in several states and even locally on a few other properties that I am pursuing)

Thank you for your response! That is helpful. Did the changes in price affect your financing situation?

0 Votes

Originally posted by @Ashley Cross:

The 6 month seasoning rule refers to purchasing and pulling forced equity. That applies to the Brrr method. If you already had the equity when you did your r/t refinance you can do a cash out whenever. The 6 months payment thing is really the lender's issue. We get dinged by the investor if you don't make at least 6 payments on your mortgage.

That's extremely helpful; thank you!

0 Votes

Hey everyone, quick refinance question:

A couple months ago, I refinanced on my primary residence for a better rate and down to a 15 year mortgage (no cash out). However, since that time I've caught the "real estate bug," and would like to do a cash-out refinance (I have fairly significant equity) to get the ball rolling. I know this is not particularly cost-effective upfront, but hindsight is 20/20.

I've heard of the "6 month rule," when it comes to cash-out refinancing. Is this an actual law or freddie mac guideline, or just a rule of thumb some lenders go by?

I am speaking with the loan officer I used for my current loan, and he said the following:

"With a conventional loan going from a rate and term refinance to a cash out, you can refinance whenever you'd like with no seasoning requirements. Some lenders will not do the refinance because ultimately they would lose money from the original loan with investors if 6 payments were not made. Being that there is no prepayment penalty you can technically turn around the next day after closing if you want to and do a cash out refinance."

However, he also said they do not want to lose my business so they could likely do it.
I just wanted to check with the forum if this is truly possible so I don't go through credit checks/inquiries just to find out it is not possible.

Thanks in advance,
Don

0 Votes

@Patrick Bavaro Thank you for continued information!

@Zach Lemaster Absolutely! I did talk with David briefly a few days ago just to get some initial information, and I am looking forward to getting much more in-depth in a few months when we are closer to making a move to getting some significant capital to hopefully begin the process. Thank you for your clarifications as well; it is good to have a picture painted on multiple ends

10 Votes

All Forum Posts by: Don M.

Don M. has started 2 posts and replied 135 times.

Post: What is the End Game

Post: Big Profits from New Construction SFR Build in Cape Coral, FL

Post: Rent to Retirement?

Post: Rent to Retirement?

Post: Cape Coral -New B2R-Rent to Retirement

Post: Rent to Retirement experience

Post: Rent to Retirement experience

Post: Cash out Refinance question

Post: Cash out Refinance question

Post: Rent to Retirement?