All Forum Posts by: Dustin Turin

Has anyone received "Property Declaration Form" notices from the City of Portland Assessor's office requesting annual operating income/expenses?

Per an article in the Press Herald on Jan 8, 2018, the city council was discussing doing a city wide reassessment but I haven't been able to find any other information on it. However, we received this notice and request in the mail today. Afraid of what it foreshadows...

Hi folks,

I recently purchased a 6-unit residential apartment building using commercial financing and 25% down. Of the down payment, 70% came from a HELOC on my primary residence (owner occupied 3 unit).

Unfortunately, it has come to our attention that there is a foundation issue that needs to be addressed at some point — we’d like to do it in the next year. Estimated cost of repairs is between 30-50k (building was purchased for 875k).

I am looking for ideas on where we could come up with this money. We've got 10k left in our HELOC.

- Should we go to the lender that holds the mortgage — any chance they would make it easy for us to get the extra money since it also protects their security in the loan (the building)?

- FHA Title I home improvement loan — not sure if this can be used on an investment property with commercial financing?

- Other ideas?

Thanks!

Dustin

We took out a $160k HELOC at 95% LTV on our primary residence (a 3-family), combined that with some savings and used it to purchase a 6-unit investment property. The bank never asked what we were doing with the money. Our rate is 4.9% fixed with a 5 year draw and 10 year repayment. I'm glad we ended up going with a HELOC instead of a home equity loan because of the flexibility. From the time we secured the HELOC to the time we actually closed on a property was about 6 months. We had one place under contract that fell through. If it had been a home equity loan, we would have been making payments for 6-months with no additional rental income coming in. Instead with the HELOC, the funds just sat there accruing no interest until we were ready to close on the place we ended up buying. Didn't need to make our first payment until we were already collecting rent on the new place. Additionally, we will most likely tap this line of credit again in a couple years once we've paid it down some. I now understand what makes a HELOC such an invaluable tool to have in your back pocket.

Thanks all for the suggestions. I did end up notifying the tenant that the roommate didn't meet screening criteria. I guess this is, after all, why we screen to begin with.

I have a tenant in a 2bd apartment with whom I recently signed a new lease. She was previously living there with a roommate and they were both on the lease, and I allowed the old roommate to move out and wrote a new lease with the one girl on the same terms. This is in a building I've only owned since Nov 1. When we wrote the lease, it was understood that she would be seeking a new roommate and I told her I was fine with that.

Now she has told me who she wants her new roommate to be and I'm not exactly thrilled. I've done a credit check and application for the prospective roommate, and she has pretty bad credit with multiple collection accounts plus a dog (she says her ex spouse ran up the bills) -- which would make 3 dogs for the apartment (current tenant has two very small dogs).

I'm struggling with what to do. On the one hand, I don't want to be overbearing and in retrospect, I did make her feel like she could pick her own roommate with not very much input from me.

On the other hand, I'm somewhat concerned with her choice of roommate and the additional dog. I did tell her there would be an additional $250 pet security from new tenant.

So, two questions:

• Should I tell her to find a different roommate? Downside being that it does make me feel like a jerk particularly since I wasn't perfectly clear from the start about not wanting another pet
• If I let her take on this roommate, should I add the new roommate to the lease (i.e., write a new lease with the two of them) or just keep the one lease with the existing tenant and make it clear to her that she is responsible for her roommates behavior, etc?

Thanks for the input, I do appreciate it.

I have a tenant in a 2bd apartment with whom I recently signed a new lease. She was previously living there with a roommate and they were both on the lease, and I allowed the old roommate to move out and wrote a new lease with the one girl on the same terms. This is in a building I've only owned since Nov 1. When we wrote the lease, it was understood that she would be seeking a new roommate and I told her I was fine with that.

Now she has told me who she wants her new roommate to be and I'm not exactly thrilled. I've done a credit check and application for the prospective roommate, and she has pretty bad credit with multiple collection accounts plus a dog (she says her ex spouse ran up the bills) -- which would make 3 dogs for the apartment (current tenant has two very small dogs).

I'm struggling with what to do. On the one hand, I don't want to be overbearing and in retrospect, I did make her feel like she could pick her own roommate with not very much input from me.

On the other hand, I'm somewhat concerned with her choice of roommate and the additional dog. I did tell her there would be an additional $250 pet security from new tenant.

So, two questions:

• Should I tell her to find a different roommate? Downside being that it does make me feel like a jerk particularly since I wasn't perfectly clear from the start about not wanting another pet
• If I let her take on this roommate, should I add the new roommate to the lease (i.e., write a new lease with the two of them) or just keep the one lease with the existing tenant and make it clear to her that she is responsible for her roommates behavior, etc?

Thanks for the input, I do appreciate it.