All Forum Posts by: Gabe E.

Thank you all for your input and perspective. I'll move forward with the repairs to have the unit rented ASAP. It's gonna be a sunk cost at this point since as you said Brian, the plumber can easily just stand by the report- as much as I disagree with it.

the plumbing invoice was ordered to perform the static test. I'm not sure if they installed any of the piping. Here is the exact wording:

'Static Test performed. Filled system with water- no drop in the water level. All new piping under house all the way to the sewer tap area by property line.'

Also, The amount charged is '$0'. I cant believe I didn't catch that. Very fishy. 

Seeing if anyone may have run across a similar situation or knows of a next step. I purchased a SF rental property through a wholesaler. Invoices were provided to me showing previous foundation work with warranty. The plumbing invoice showed very clearly that a full static plumbing test was performed and that the house had all new piping with no indication of leaks. Both companies had the previous owner's signature on them. I know I should have hired my own crew to double check but the invoices were extensive and I had researched the companies - enough to move forward with the deal.

I close on the property and during the remodeling phase I find out from another investor that they used the very same plumber and found that he had missed many leaks when he had tested their property before buying.

I decided to order a second report camera test (a month later from the previous plumbing report) from a reputable plumbing company as to the integrity of the plumbing under the slab of my new rental. The independent plumbing report showed the exact opposite of the first report. It showed disconnected piping under the slab, failed static tests, and that $11k worth of work would need to be done to repair the problem – to include tunneling and reconnecting piping.

My question is, do I have any recourse here? I understand it wasn't me that hired the initial plumber who provided the (in my opinion, bogus) report. The 2 reports are only 30 days apart; but they are drastically different. So 2 different properties inspected by this plumber and both wrong. Major incompetence on them, again, along with my HUGE oversight. I haven’t yet contacted the initial plumber because I anticipate they will just brush me off here. I spoke with an attorney and they mention they will need to do more research, but might have a case. Of course im looking at close to $1k retainer fees to get the ball rolling. Any suggestions?

I met with a local RE attorney yesterday who's primary job is litigation. So his take was from a reverse engineered litigious standpoint. He says the Series LLC is hands down the best way for asset protection. When you have the Series LLC, you do not need the high liability insurance coverage if you do not own homes outright. If ppl wanna sue you, it becomes less of a payday because you have a 1st lien holder that needs to get paid first, after that only then can they come after your equity. Not worth it for the attorney who's suing you because it is not a guaranteed payday and plus you might not have much equity to go after.

An example he gave was a RE investor who had about 15 SFRs (cant remember if they were fully paid for or  not) without LLCs and was sued by someone he had been in a car accident with. The other party had an attorney check his assets and found a possible payday. The cost to defend yourself in court can amount to quite a bit and even if you win, you are still out a lot of time and money.

However, he stressed the Series LLC is NOT guaranteed protection for DOS or NEGLIGENCE.

To me, the Series LLC sounds doable if you own the properties outright. But if you are starting out, you will likely have mortgages tied to your properties. Taking another hard look at umbrella coverage now..

This being said, I like the idea of commercial lending where LLCs seem to be more acceptable at the onset. Putting down more upfront will likely be a reality, but I don't see any other solution at this time for expanding.

@Steve Babiak. Thanks Steve. I gladly took your advice and asked vendor #1 of installing the Lennox unit instead of the originally quoted Payne unit. Their quote: $5,697. I will stick with vendor 2 @ $5500 with free maintenance. Ive yet to hear back from the latest vedor who went to the property this past Friday. But they did state the $5500 quote would be hard to beat.

@John Hamilton, John i think those are the words that reign 'jackpot' to me that were sublimilally (word?) floating around after weighing some options/scenarios. Hinging on the latest quote i receive from another repuatable dealer, it just comes down to the cost of this other reputable dealer's system install. New system no doubt is the end game for this case. This will be a buy and hold for the next 5 year window.

@JD thanks JD. Will be discussing another bid tomorrow on a Ruud install, which i understand is in the Rheem family. I'll post how it goes.

@ Damon. Thanks Damon, I'd like to get to the point of having a nice list of trusted reliable fair priced vendor list. So far i know a professional painter, who now does it on the side for a great price.

Thank you all. Im so far leaning on vendor 2 Lennox system for the reduced headache factor, free checkups, positive reviews, and been in business over 20 years. I'll do more research and make the final decision by week's end. There is one more trusted vendor i just learned about from a local investor in my area today. I'll follow up with them and see where they stack up, armed with this info. Your experiences have been invaluable.

@ Doug McLeod. Doug, that is my gut feeling too. I can support that my headache factor might be reduced with that option. Estimating a $45 maint service call over the next 5 years = $225. I could save that with vendor 2 since they do it free (before summer/winter). Save even more beyond the 5 yr mark.

@ Ahmed Porter, This was my first thought in paying the $400 and hoping it lasts. Heat is brutal through at least early October so that leaves about 2 to 3 months. The problem also is the heater is untested. Ive been told the piping is not up to code for the gas furnace. So that would potentially be another cost/health problem. I'd test myself but the blower is out, thus a catch22.

@Thomas Oliver. $3200 is a great deal! I need to find a vendor that would help lower the cost. But that is something i gotta think about. It might be more the installer who is more important than the unit brand itself.

@ Jeff B. Im guessing you are leaning toward the lower cost vendor 1 with the Payne install?

These are all great points. I am a penny pincher but also one to enjoy less headaches in the future. Cant have it both ways i know.