All Forum Posts by: Eddy Dumire

I personally don't think you should accept a 5% listing if your intent is to pass the buck onto the selling agent.  If you're going to discount something, discount your own commission, or at least split the difference.

@Rusty Scott -- meant to tag you so you knew I replied...

I've learned lots from this specific house and honestly, I intended to use this property as a learning experience when I bought it.  It's in a far worse neighborhood and it's a far older property than I have dealt with in the past.

So if I had to boil it down, here's what I've learned:

1.  You're right, everyone get's screened before signing a lease, even if they're an existing tenant in a house I acquire.  If they present a valid lease with the prior owner I have to honor it, but if not they have to pass the same screening as everyone else.  If the house needs major work, then don't sign a lease at all, just start the unlawful detainer process.

2.  Do not delay any step of the eviction process.  I drug my feet during some of the steps and it cost me more in lost rent than it should have.  Day 6 gets the 5 day notice and day 11 gets the unlawful detainer filing AND a cash for keys offer.

3.  Believe only what you see and almost none of what the tenant tells you.

4.  Trash service it automatically rolled into the rent.  Otherwise the tenant may think it's optional.

5.  Anyone who lives in a filthy rundown house is likely responsible for the filth.  They're not going to take care of nice new things that you install.

6.  I really don't need a lawyer to hold my hand for a typical eviction process.

7.  Get the neighbors on your side early.

8.  Roll off dumpsters are expensive and fill up fast.  In Fredericksburg it's about $400 for a 20 yd dumpster for a month.

I hope this helps someone down the line.

So we filed for the writ of possession and were contacted about 24 hours later by the Sheriff.  We scheduled to perform the eviction on Friday.  I had a dumpster delivered Tuesday morning in preparation.  I got a text from the tenant on Wednesday asking about some of her items (which I didn't know anything about).  She also let me know that they had vacated the property at that time.

I confirmed with her that everything remaining in the property was trash.  I did go ahead and wait until the eviction time, change the locks and then waited another 24 hours to start throwing things in the dumpster outside.  They had cleared out very little and it took my son and I the whole day to clear most of the items out of the house.

We were approached by no less than 5 neighbors throughout the day making comments about how glad they were to have the place cleaned up, how shocked they were that people would live that way, and how sorry for us they were that we had to clean up after them.  The inside of the house smelled horrible and after all the personal items were removed and the carpet and pad, it was better but not completely resolved.  There are original hardwood floors underneath the nasty carpet but I think they may be too far gone to be salvaged.

Unfortunately I've decided that I have to gut the bathroom.  I was really hoping that wouldn't be the case.  I also had a guy out to give me an estimate on an HVAC install.  The house currently has a baseboard heat system that very well may be original (1960's).  I'm going to bite the bullet and pull out the baseboard and install central heat and air conditioning.  I think the AC will help me get a premium over the neighboring rents.

I was shocked that the estimate for the new system came in at $7,500.  As I've mentioned this is a tiny 725 sf house.  The plan was to mount the new furnace in the attic and run primarily flex duct to each of the rooms.  The house is a 25'x29' box and there are 5 rooms.  I know that I can find suitable systems at online HVAC wholesalers for less than $2k.  The ducting, registers, returns, etc would be far less than $1000.  That would mean these guys want to make $4500 for labor for just a few days of work.  Needless to say I'm looking for other quotes.

Finally, a neighbor offered to clean the house for $250.  I took him up on the offer in addition to giving him a grill that the prior occupants left behind.  I thought it would be a gesture of goodwill and would help me get a set of eyes on the property on a regular basis.  I've also installed a couple of security cameras inside and bought a wifi hotspot.  I get email alerts with pictures any time there's movement in the house.

At this point, this house is sitting empty and likely will be so through the holidays and maybe into Jan.  I really hope I can get a lease signed for Feb.  I just got a new house myself and converted my old one to a rental.  It has some renovation work to be done too so I have two vacancies right now and it's really eating into my monthly cashflow.

Thanks @Wayne Brooks.  Yes I'm learning more and more about this every minute.  The amount seemed really inflated also.  Now I'm seeing that the recorded amount is 150% of the loan because there is no maturity date.  Very interesting world.  I thought I knew a lot about mortgages but this really threw me for a loop.

Thanks to BP Nation for providing quick answers!

Ok so I immediately after posting I found the answer to my own question.  I thought I'd post it here in case someone else ever comes across this same scenario.

In the auction announcement, it mentions a specific document number that had been recorded in the clerk's office of the circuit court.  Matching this document number back to the Deeds of trust, I see that it is in fact the first deed that is being foreclosed on.

I was worried that I would get there and bid and win a second and still have to satisfy the first to acquire the property.

I'm about to go to an auction (in about 40 minutes).  I just got back the title search.  There is an "Adjustable Rate Home Equity Conversion Deed of Trust" in 1st position for amount X issued on date Y.  There's also an "Adjustable Rate Home Equity Conversion Second Deed of Trust" issued on the same date for the same amount.

How do I know which one is being foreclosed on?

We finally had court today.  It took a little longer to get to court than I had planned but we finally got there.  Unfortunately, my tenant showed up and represented herself.  That means that no matter what, I wasn't going to get immediate possession.

When we were called, she denied to the judge that she owed me rent on the basis that I had promised to do repairs.  For the record, I have spent about $6k on window replacement, door replacement, new kitchen cabinets, new countertop and sink, and a new stove.  The most critical issue with the house right now is that there isn't a working furnace or hot water heater.  I can't repair either of these items until they pay to have the gas turned on.  I have told them this many times.

She tried to claim that the house was unlivable.  The judge asked if the city had made that determination.  She replied that they had not.  He informed her that only the city could determine that a house was unlivable.

He then suggested to her that if the conditions were so bad, she should move out.  She told him that she couldn't afford to move.

It didn't seem that the judge was leaning too far in her direction, but was at least entertaining the idea that she may have valid complaints.  I then produced the cash for keys agreement that they hadn't honored and told the judge that they had agreed to move out on Nov 1 and that I was going to pay them to do so.  He informed her that she had signed away most of her rights in the cash for keys agreement.

At this point, things were looking very good for me.  She said that she needed legal representation.  He chuckled a bit and said that she could ask for representation on appeal.

He asked me if I would agree to judgement for possession only without a monetary judgement.  I'm pretty sure if I had declined this he would have set a trial date.  I accepted immediately.  I really just want the house back so I can finish rehab and get it occupied.  She also agreed to the judgement for possession only -- though I'm not sure why.  I don't know if she realized she could have gotten a trial and delayed things by at least another month.

In all it's a pretty good outcome.  I can file for possession after Dec 4.  From talking to the deputy clerk, it sounds like the sheriff will schedule the eviction around 72 hours afterwards.

Faye,

I've found some good people to work with in Stafford & Fredericksburg. Let me know exactly what you're looking for. PM me if you like.

Eddy

So the cash for keys date came and went.  I first got a call saying that they didn't have anyone help to lift furniture -- I replied "I'll be back in town around 1:00.  I'll come help you."  Of course I didn't really think they'd take me up on it and I was right.  Then came another call about having possession of some things that belong to someone who was in prison that they couldn't get a hold of.  That was followed by the inevitable request to move out later in the week.  I told them that every day was costing me money and that if they wanted to move out later we would have to renegotiate the cash for keys amount.

After I got back in town I received another text asking how much it would cost them per day in the cash for keys agreement.  I told them they would lose $100 for each additional day.  I was hoping that would motivate them to move quickly, unfortunately I may have pressed a little too hard.  They said that the next chance they had to move would be at Thanksgiving and that I could just go ahead and file the papers.

Unfortunately, when they said they would be out, I decided to forego going to the courthouse to file for unlawful detainer.  That decision has probably cost me a couple weeks.  I bit the bullet and did that today.  Initially we thought the first court date available was going to be mid December, but they were able to get us a court date of late November.

So, at this point I've only collected two month's rent since August 1.  October and November are both going to be a full loss.  Then it will take me to mid December to get possession back.  I doubt I can get it fixed up in the last two weeks of December so renovations will likely run into the first few weeks of January.  Hopefully I can get a tenant in for Feb 2016.

So the latest lesson I've learned is don't delay any step in the process.  I drug my feet delivering the 5 day notice.  Then I didn't mail a copy for a few more days.  Then I waited 5 days from the day they received the notice to offer them a cash for keys agreement.  Finally, I didn't file the unlawful detainer until the cash for keys expired.  Now I have to wait almost a whole month to get into court.

If I had delivered the 5 day notice on the 6th of October, I could have filed or unlawful detainer on the 12th.  I may have gotten an October 26th court date or worst case scenario a November 16 date.  I've probably cost myself a full month of additional rent.