All Forum Posts by: Harriet Baldwin

Check with an accountant.  You may have options, some of which might require some paperwork if you don't already have an operating agreement in addition to the ownership split. (I am not an accountant!)

@Kurt Pourbaix I agree with other responders, as described this sounds more like a joint venture than a lender/borrower situation.

However, talk to your accountant, there may be ways to structure your arrangement so part of it is lending (with interest income & principal repayment) and part of it is investing...if that would be helpful to you and your tax situation. (not an accountant/not legal advice)

IMO time-on-market and other realistic (or, from seller's perspective, lowball) offers are the main ways a seller realizes their expectations are out of whack.  

Make your offer, explain you are an investor and that you understand if your offer is lower than they want to accept, and leave it at that.  To show you are serious, including a bank statement showing you could buy for cash should do it (black out any info you don't want to share).

If this seller doesn't want to negotiate close to your price, I would move on to properties where the seller is ready to sell.  (Unless there is some reason that this property is the ONLY one that works for what you need - but then, guess what, it's worth more to you than the comps suggest...)

As @Michael Herr points out, each water authority has its own approach.  Most (but perhaps not all) water boards who require the account to be in the owner's name do allow sending the bill to "occupant" at the service address.  

For MF's with meters serving more than 1 unit, if water is costly in your area, submetering (to accurately pro-rate bill) or adding meters may be worth it.  In some areas it takes a huge amount paper of effort to add meters so each unit has its own; other areas it's pretty easy...although in many cases the cost to split service (depending on how inter-related the plumbing is) may be too high to justify doing it.

@Jeff Gates, if someone is going to not pay a bill, there is little you can put in the lease to change that - more about screening IMO.  But a few ideas anyway - take a 'water account deposit' that you may choose to waive if someone shows proof of paying water bill on time in the past.  Put it in the lease that unpaid water bills may be deemed "added rent" and that not paying the bill/receiving shutoff notice/etc is default of lease and grounds for eviction.  Have a "water not included in base rent" disclosure that prospective tenants sign...not an attorney/not legal advice/check local law and regulation...

@Joshua Pope that's a great, concise answer!

One additional thought - our carrier does do vacant properties. But if we don't notify the carrier and they find out the property is vacant, they can cancel our policy if the vacancy has been too long.  Once when we did forget, they gave us the option to retroactively disclose & pay-once we certified no claims through the current date.

Sounds like this property isn't working for you - not making money *and* is a hassle. 

Since you owe about what it's worth, how about making a few cosmetic fixes (garage-see note, bathroom ceiling) and selling it?  Even if you have to pay out of pocket (after closing costs), at least you won't be $200-$1,000 behind each month just on the mortgage, even before accounting for maintenance and repairs...

Note- if the garage is falling down, I vote for demo.  But if it's just ugly, some paint & new doors could solve most of the issue (and might cost less than demo).

@Jamie Gruber, you could also try posting on the Rent to Own aka lease option forum here at BP.  Two thoughts: 

1-are your current tenants rent to own candidates? And would their income handle the mortgage payments?  If so you could do a lease option or a subject to style deal.  The mtg payments totaling above-market rent make this a bit of a stretch, but you can always ask. 

2-does the zoning allow rooming houses? Likely not, but if it does, you could rent out by the room (possibly with some investment upfront - fire separation, etc) and likely cover the payment.  This would possibly work best with a local (or even on-site) property manager. You would want to figure out if the additional effort to manage a rooming situation is worth it to avoid investing cash to 'cure' the situation - there's no absolute right answer, it's a question of what you are most comfortable with.

Since you have the ability, I would be tempted to pay off the second and then take another try at HARP...

@Gigi Ochoa If her income isn't sufficient, you could have her pre-pay (from house proceeds) so that her income would cover the (now lower) monthly payment.  

Some areas make it difficult to collect more than a certain # of terms' rent up front, but in some cases structuring as a full year (or two's) lease rather than a 12 or 24 month lease can work - check local laws/legal advice (not a lawyer, so this isn't legal advice).

Some states/areas have more options than others, as we discovered when we had to change from CT to NY coverage.  If a faith-based option isn't a good fit (in addition to @Nadia White's suggestion, there is Medishare and I'm sure a few others), finding a local group may help.  

Our Chamber of Commerce has a group plan that any member can use.  Check with a local independent commercial insurance agent that handles benefits, they will have a pretty good idea of the options open to you as a business.

When we've done the math, a higher deductible plan usually wins out vs. higher premiums/lower deductible (especially if you can use an HSA).  But if you know you have ongoing medical costs, your math may be different!  

Finally, check with your accountant, if your business sets up a benefits program that pays for health insurance of its principals (and employees, if any), you may be able to deduct the insurance premiums as a business expense (not an accountant/not legal or tax advice).

I think they can get a standard lease at Treu office supply on Baldwin St (near the County Courthouse).

They will want to register the property as a rental if it is in the City of Elmira.  No fee or inspection, just a form to file with the Code Enforcement office (at the main fire station) so if there is a problem, Code knows who to call (also, if they ever need to evict, it is helpful to be able to show the court that the building is rental registered).  If your grandparents no longer live in the county, they will need to have an in-county contact for the rental registration.  If the building has 4 or more units, there is an annual fire safety inspection...sounds like that doesn't apply here.

That's it off the top of my head, hope that helps.