All Forum Posts by: Glen Sonnenberg

Well, it's been almost four months but yesterday Solar City finally installed our solar panels on our rental in Phoenix. I can only assume that they are pretty busy but the approvals from the city seem to have taken longer than expected. Unfortunately, there are still a couple more hoops we have to jump through to get them turned on and generating electricity. The city has to inspect them and APS has to also. Apparently the city will take another week or so and APS may take up to another three weeks. Fun stuff. I'll post more when we're generating power.

On a side note, apparently APS is doing a major push to try and reverse the net-metering laws in Arizona. Their current argument is that people who don't have solar are being forced to pay "higher" rates because APS has to cover infrastructure/grid costs which solar users don't pay. Not sure about that since I'm pretty sure our bill has fixed fees for transmission and other facility costs regardless of the amount of electricity used. They have two proposals which I've read. First, is to drop the payment for excess electricity and reimburse through some federal credit at about 1/3 the rate. The second, and seemingly insane, proposal is to treat all solar installations as wholesale power producers. This means they would "buy" 100% of the solar power we produce at wholesale rates and charge us retail rates for the electricity we use! Crazy! Who knows if either of these changes will pass but I'm watching to find out since this definitely would impact the payoff of installing solar. We'll see but I'm committed either way since I prepaid the 20-year lease.

Why on earth would you want to be involved financially (via a partnership or whatever) with someone who you admit you cannot trust and will look to push the limits of whatever agreement you might come up with? Don't do it. If you can't trust the person, do not go into any agreement with them. It will end badly.

Met with a Solar City rep and got their information. Apparently they don't have a power-purchase agreement in Arizona either so the only option is a lease for rentals in order to get the benefits of the tax credit. Their terms are better than the company in Nevada. They offered two plans both for 20 years. A zero-down pay-as-you-go option or a pre-paid lease. They have the ability to recalculate based on any set amount you want to put down but once its installed you're committed to whatever plan you decide. They also have a 12 month option where you pay for the whole system over 12 months rather than financing over a longer term.

Once they put in our usage data, it turned out that with the roof space we have we can do a system which will cover ~66% of our usage. I'm sure it fluctuates but that's the base guarantee. APS has a few billing plans and they recommend that we switch to a plan which bills high rates during peak times (noon-7pm) and very low rates off-peak. They quoted me for a ~7.5kW system (slightly smaller than the one in Las Vegas but the house is smaller ~1500 sq ft.). After all of the rebates, etc. I can either start paying $127 a month for 20 years or pre-pay $15200 for the system (maintenance, monitoring and insurance included). They project our electric bill will drop to around $60 a month on average. I'm not exactly sure what our electric bill will look like during the winter but last month's was $322 so it looks like a pretty good savings. I'm pretty sure I'm going to get it. Just need to work out the financing since I'm thinking about using a cash-out refi to pre-pay the $15k. After that I'll probably focus on some of the things we can do to reduce consumption but since this is a student rental and utilities are included it makes sense to go solar. Lastly, they say there is a two-month lead time to get it installed. Sometimes longer if there are permit, electrical or HOA issues but our house was build in 2004 and there isn't an HOA so we should be good to go in a few months. I'll see about posting data once we have it up and running. Solar still may not be 100% competitive but with the incentives and credits it seems to be a good option in areas where there's lots of sun. More to come later...

Solar City called me back and after discussing it with them they thought they could quote me a system for our house in Phoenix with only about two months of electricity usage data. I have an appointment with a tech on Tuesday morning to discuss it. I will post the results/quote once I have it.

With 9 rentals I would certainly recommend getting an umbrella policy especially if you don't have them under an LLC. It's very cheap relative to the coverage. I have a $2M policy and it's around $600 which may be high but still worth it. I went with Geico since my other policies are with them and they sell a policy through Travelers. There might be some limitations on the number of rental properties which can be covered under a personal policy as opposed to a commercial/business policy. I was told it was four properties plus my personal home(s).

Looks like Verizon finally announced the HTC One is coming later this Summer.

http://allthingsd.com/20130603/yes-virginia-there-will-be-a-verizon-htc-one/?reflink=ATD_yahoo_ticker

Why are you looking to the government to help fund your investment? Why not decide what you want and then move toward it on your own. There's a ton of information on this website (and others) that will provide a nice blueprint for how to get it. Looking to the government to "help" sounds like you're looking for a shortcut.

However you dress it up, I think this is an unethical and potentially illegal transaction depending on what documents you are required to sign. Either disclose everything or don't do it. Just my opinion.

It sounds like he's talking about the Homepath Mortgage and Homepath Renovation programs. If you qualify and have less than 4 mortgages then you can get an investor loan for 10% down. If you have more than 4 mortgages then it will be 20% down + six months reserves and a 720+ credit score (may vary a little by lender). Renovations can be folded into a single mortgage (up to 35% ARV or $35k max). I used a Homepath lender to get around the appraisal requirement and it went fine. I think the rate may be a little higher than you could get otherwise but 4.3% doesn't sound that bad. However, as Jon said, you won't be getting a loan from Freddie or Fannie directly. It will be through a participating lender and there aren't as many as conventional lenders so you may have to shop around. It seems like a good program to me and my experience was pretty good but it also probably depends on the lender.

I've purchased three investment properties and asked for concessions for a portion of closing costs each time. It depends on the seller.