All Forum Posts by: Elenis Camargo

Hey BP! My husband and I are closing on our 3rd rental with inherited tenants, but this scenario is a bit different. We live in NYC now but want to move to Jacksonville where our rentals are. This property we are closing on is the one we will be moving into. It needs a complete gut job. The tenants have been there 12 years and want to stay. They are hoarders so it doesn’t seem like they will go anywhere. Next spring we will tell them they have a few months to find a new place and then we will go down to Florida, gut the place, reno and move in.

So here’s the deal. The property was just purchased in December for a quick small profit flip. The new/current owner does not have a lease or security deposit. The tenants have been month to month I assume for a long time. We are asking the tenants to fill out an estoppel agreement just to see if they did give someone at some point a security deposit so that we won’t have to deal with that later. The question is, would you put a new lease in place for a year and then leave them month to month until it’s time to gut the place? Would you ask them for a security deposit if there is none in place? A new lease costs $250 and either way we have to gut the place when they move out so a security deposit wouldn’t do much. Not sure if it’s worth it but then again if there is no lease in place now it’s worrisome. Our two other inherited tenants had leases and security deposits in place. Just wanted some feedback on what you would do in this situation! Thanks!!

@Dylan Barnard Interesting that you have that problem with one campaign and not much with the other. If you don't mind sharing the ad and the settings, I can take a look. I've done FB ads a lot for work (I'm in digital marketing) and maybe there is something there? But if not it could just be that people on FB sometimes don't set their language so FB thinks they are English speakers when they are really not. 

@Chris Phillips I think there is one more thing to consider. Your wife is a real estate agent and her business is picking up in Pittsburgh but once you move she will have to start over. Is it better to start over years down the road when she has all this success and significant income coming in, or better to start over now where her income is not significant yet? If your job can move anywhere then I think it's something to think about. 

Also, you don't know if years down the road your house will be worth as much as it is now. Well it can be worth more or it can be worth less also. We never know! What we do know is that right now you have $75k in equity and can make a good amount if you sell it and move on. Too bad the refi option doesn't work though.  

Best of luck!

@Dylan Barnard What kind of leads are you looking for? I assume you are looking for people wanting to sell their house?

I would say do NOT purchase a property without having a plan behind it and doing your due diligence on it. Plan being are you going to rent it, flip it, rehab and refinance it, whichever it is, have that plan and have a backup. Then make sure you do your due diligence. For example, if you're going to rent it out then how much are mortgage and expenses, how much are rents, etc. to get your cash flow. What's the neighborhood like, are there good tenants, etc. If you were going to flip it then look at the specs for that. All comes from your initial plan for the investment!

@Michael Junior As long as you did your analysis and the numbers work, then it's fine to pay more than list price. You know many times sellers list their properties either at unreasonably high numbers or sometimes they list it too low to just get rid of it. They probably needed to get rid of it fast and that's why so many people went to go view it. Don't overthink it. You did your analysis and should be fine!

@Brian Ellis Have you ever had to repair the washer/dryer? I would be pretty pissed if my tenants were trying to steal my appliances. I would notify them that reviewing the documents, you see the washer/dryer belonged to the seller and not them. If they take it, you will remove the cost to replace them from the security deposit. I doubt they will bother taking it after that. Good luck!

@Hilary Stalder I am in the same boat!! We found a property we really want to flip but it has a foundation issue with an estimate of $36k. At first we thought we should walk away, but then thinking about it makes us want to move forward. Most flippers will walk away from this deal and the one who does it right can make some decent money. We are highly considering doing it!

@Victor Hogan We purchase homes that need work so that we can get them at a lower price and add value along the way. We did that with our first property and made some money while the inherited tenant was there, then when she abandoned we rehabbed it and increased the cash flow. I wrote a blog about it if you’d like to read our experience with that: https://www.biggerpockets.com/blogs/11360/78720-how-our-first-property-turned-into-an-eviction-and-rehab-5-months-in What I would change in the next one is rehab the property fully up front so that we don’t have problems with the inherited tenants along the way. It’s much easier and quicker to get work done when the home is empty.

@Roemeo Barnette Congrats!! Keep us posted on that :) glad this was helpful.