All Forum Posts by: Doug Meeuwsen

I’m looking for advice on how to setup a structured partnership with my in-laws so that both parties achieve their goals.

In-laws goals: downsize from their current property, have a constant rent payment going forward (on fixed income), and avoid a situation where the landlord wants to sell property while they are renting.

Our goals: Obtain another investment property while not having to pay anything for a down payment.

I envision that my in-laws would use $250k (equity in current house) as a down payment to get into a new smaller location. My wife and I would be responsible for all maintenance, keeping rent level constant, and eventually getting the down payment paid back.

Is there a path forward here? Obviously mortgage rates dropping is ideal and would allow for a portion of the $250k down payment to be pulled back out (cash out refi) all while keeping rents pretty close to constant. Looking for other ideas, and structures that would help achieve a successful partnership.

Thanks Doug

@Mike Hern

Thanks Mike for the reply. I understand there are tax and legal complications but I was looking to brainstorm potential structures that I could present as possibilities. It’s a unique situation however I feel there is leeway on both sides where a deal could achieve multiple objectives.

Doug

I have a potential partnership opportunity with my in-laws and I am seeking ideas and advice on how to proceed with the partnership structure.

Market: North County San Diego.

I am looking to pick up a single family house that my in-laws would move into and “rent back” from my wife and I. . North Country has a large barrier of entry financially and as a result my in laws are willing to help initially with the down payment with the understanding that my wife and I would have plans and ability to pay back. My wife and I would be responsible for all maintenance and cap Ex.

Question: how should we proceed and under what partnership structure would be ideal to get a no money down deal where the main goal would be to not make cash flow off the tenants?

Thanks in advance for any help.

Doug Meeuwsen

What is the best platform (for a landlord and tenant) for paying and collecting rent in a long distance situation. I see Cozy mentioned in the older posts over and over but it looks like they have somewhat merged with Apartments.com. Are people still using this platform? I’m not overly concerned for a 5 day waiting period for the funds to show up, but I would like to have tools available to me as the landlord to see things like the payment is in process, payment history, etc. Any suggestions that help set this process up correctly with my first property is much appreciated. Thanks in advance.

Doug Meeuwsen

@John Leavelle You are correct, I found my error. I was assuming maintenance $/month not $/year. My new purchase price to net $100/month cashflow would be $154k. Thanks for taking the time to look over my numbers. Big help. Doug

@John Leavelle. Thank you very much for the reply. I will make sure to double check my numbers and respond tomorrow. Is Cap Ex not the same as setting side a percentage for maintenance? Doug

Good Afternoon BP.

I am a new investor from Hillsboro OR and believe to have found a potential first buy and hold rental property.  If you guys wouldn't mind, could you please look over my numbers and shoot as many holes in this deal as you can find.  I am comfortable/satisfied with potential deal location, schools, crime, etc however with this being my first, I would like a sounding board on the financials.

My business partner and I have been preapproved for a 30 year conventional loan at a rate of about 5%, with 20% down ($37,679).  Our mortgage broker said it's usually about a 0.5% rate increase above normal conventional rates due to this being an investment property.  Does that sound familiar to people?

After listening to the first 120 or so podcasts, my business partner and I are shooting for $100 dollars a month in cash flow (after expenses) assuming outside property management costs folded in even though we plan on doing our own property management for a while. 

Financials:

Rent - $1300/month ($15,600/year), Taxes - $2090/year, Insurance - $500/year, Maintenance - 12% of rent, Vacancy - 8.5 %, Property Management - 10% of rent, Utilities will be paid for by renter, Closing Costs covered by buyer - 3% ($5,652), and $2000 worth small repairs before being rent ready.

Given the above stated factors I calculate my annual Gross Income, and Expenses to be $14,851 and $3,942 yielding an NOI of $10,909.

At a purchase price of $188,393 ($45,000 below asking) I calculate the mortgage and interest to be $9,709/year ($809/month) yielding $1,200 a month in cash flow when compared to the NOI.

I calculate the ROI to be: Annual Cash flow of $1,200 / Cash needed of $45,330 ($37,679 + $5,652 + 2,000) = 2.65%. Lastly, if I include the principle being paid down by the renter in addition to the cash flow, I calculate a first year total ROI being 7.55%. I know this all assumes a purchase price $45k below asking however only at this level would be comfortable as a first time investor.

I really appreciate the sounding board and look forward to hearing what people have to say.  Thanks again.

Doug Meeuwsen 

Good Evening BiggerPockets A few quick questions about a potential investment property in Oregon. Back on May 11, 2017 the property I am focused on had a contingent offer that fell through. Property was relisted May 31, 2017. #1. Is it acceptable for me to ask the listing agent what caused the previous deal to fall through. I would like to be warned if it was something structural. #2. Is it acceptable for me to ask what the agreed upon contingent offer price was? Any help is much appreciated. Doug Meeuwsen

Kevin Jorgensen I'm in the same boat as you when it comes to options however I lean towards the bubble scenario. When I hear police officers/nurses/etc being approved for and buying $500-600k properties it won't take much for the boat to be rocked and defaults to start again. Not that I don't appreciate people in this sector (complete opposite from the truth) I just don't think associated wages can support. Doug

My wife is due right around there, however if it works out I would like to make an appearance. Look very forward to meeting everyone.