All Forum Posts by: Heather Schmidtknecht

@Shiloh Lundahl, I’d like to learn more about the option to buy agreement. What percentage of tenants follow through and actually end up buying?

@Byron Scott, so cool to hear your story! I’m a Dave Ramsey podcast fan in addition to a BP podcast fan — both offer a wealth of information with very different perspectives on money/debt... if you want to expand the breadth of your personal finance knowledge, check him out!

@Amy W. — my answer is dependent on more info. Is she a good tenant otherwise? If so, and she pays (but predictably late, and then with the late fee), can you plan around this so that it doesn’t cost you time and money? If you don’t renew her, you take the chance of getting someone who does not pay at all and/or is not a good tenant otherwise. If she’s taking care of the place, I might be inclined to keep her and just plan on the rent (plus the late fee) coming on the 6th. ;)

@Daniel Whitmore, I think part of the answer to your question(s) depends on what you are looking to get out of this transaction... for instance, are you after cashflow?

My motivation as an investor is to diversify my retirement portfolio, as I have a W-2 that I LOVE and plan to keep... so what I want from my rental(s) is for the rent collected to pay most/all of the mortgage and other monthly expenses, as well as long-term maintenance, etc. and for the property to be paid off (and to have appreciated in value) within 15 years. Because I don’t *need* cashflow, I may do a deal that others may not. But I sleep well at night knowing that right now my properties are “paying their own bills” and if needed, I could sell them at any time, for more than I owe the bank.

Other advice: start small and think through the worst possible outcome(s) before jumping in. Good Luck! :)

@Matthew Nixon, my husband was really negative about real estate before my first deal too... but once he saw me execute a solid deal and secure a desirable tenant, his mind changed and he sees the light! Whatever you decide to do, make sure your first endeavor is a WIN that even she will be able to see... and she’ll slowly get on board.

@Evan Evans, your numbers would keep me awake at night. With a spouse and three kids, I’d be looking to own a home FREE AND CLEAR for MY family before I’d be comfortable jumping into this amount of debt... despite your special lender.

@Scott Rogers — both of my properties are located in Winona, MN. We have a university as well as a technical college in Winona, so many of the rental properties fill up quickly with students. I have found that well-maintained 3-bedroom houses fill quickly with families (vs. students) looking to rent in this area, as I quickly secured a very desirable tenant for my first property as well. Let’s just hope it stays that way!! ;)

Completed the deal on Property #2 last week.

3 Bedroom / 1.5 Bath with central air, main floor laundry, and a fenced-in yard. Purchased for $125,000 and renting for $1250/month — tenant pays utilities and is responsible for lawn/snow.

I think I am most proud of the fact that I requested to be able to show the house to prospective tenants one time per week within the purchase offer, so I literally got the keys on Friday morning and had a tenant moving in Sunday afternoon!

@Charlie Moore, I would not. However, I do like looking up prospective tenants on Facebook — many of their pages give you a good idea about how they conduct themselves.

@Renata Brajkovski I heard from a friend of the seller that they were hoping not to go lower than $125,000 in case they had to pay the seller’s closing costs (that tells me they could go lower if I paid my own closing costs)... and they need to close the first week in July. The closing date is not an issue for me... just wondering which option to offer.