All Forum Posts by: Christian Hutchinson

All good stuff to know, but this property is in Madison Heights, MI with 43rd District Court.

I'm having a tenant bring suit against me.  At dispute is $180 of a security deposit withheld because of unmowed lawn when they moved.

The security deposit was $1300, I withheld $400.  There was damage to the carpet which I charged $200.00.  I was attempting to be reasonable, though I had to replace the living room the whole area's flooring (15x25) I did that with laminate flooring at 1.29/sq ft. Also, the home was left unclean, and we had some holes in the wall from hanging. Also the carpet was unclean.  The unmowed lawn we do not have photos, however, I have a VM from a neighbor saying they moved out and the lawn was uncut.  This VM was 1-2 two days after they moved out.  He said he cut the grass which we paid him for about one week later.

Also, the tenants lease ran through August 31, I allowed them to move out one month early without penalty. They vacated August 3rd they said. I know we had the keys August 5th.

So this is where it gets interesting.  The neighbor said there was going to be a fine, thats why he cut it. I though he said the City had fined me. The City was out he saw them then he cut the grass and called us. So I reported a fine to the tenant I asked the City for docs "they said they would look".  So I told the tenant of the violation, turns out no violation. I cut the check for $900 on Sept 2.  On Sept 6(Labor Day) I get an email threatening lawsuit if they don't get their deposit back along with the $180.  So I don't respond because now we are playing the legal game.  Check is cashed  Sept 7 for $900.00

So how do I fix this situation, we had paid $200 for someone to clean the property, we fixed the wall damage, and we had to replace the floor.  We couldn't fix the damage to the carpet without replacing the whole house which is 900 sq ft(estimated $2/sq ft installed), which is why we decided put down laminate on just the affected room. Plus we paid the neighbor $80 for mowing the lawn.

Mind you this Helicopter Mom situation. The tenant isn't driving this situation, The Mom is.  There were issues during the leasing process, and I wanted to walk away, and she threatened lawsuit.

My Goal is to always stay out of court, but at this point I need to make a decision am I ready to go to blows with someone over $180.

I have a qualified lead on a rental.  They are an Overflow Applicant I can't help because someone else already has secured the property.  They are qualified income wise for 900-1200 per month.

I have not done a credit or background check.

Tenants are looking for a 3 bedroom in Metro Detroit.  South Oakland County is ideal(my property is in Madison Heights).

Anyone want their contact information? I always try to pass off my qualified leads I can't help, as a consolation for not getting the place.

Hey Dustin, Welcome to The Mitten, and more importantly The D.

$150K liquid you have a range of possibilities especially if you are handy, and can rough it for periods of time.

We are from Metro Detroit, and wanted to invest in the City.  So we bought a big older home and split it a few ways while we live in it, we literally started with 1 working bathroom out of 6 in the home, we are up to 5. Then we turned our old home into a rental.  Then we hedged our bet because we do believe in the City and bought a home that we would be happy living in Grosse Pointe Farms.  Because historically as home prices improve in Detroit they go up even more in GP.  Thats how we honestly got our start.

Two years ago $150K would have landed you a property or multiple ones even in Downtown.

In the current environment those areas you named, because Mortgages are non-existent basically in the Detroit, you could burn up a significant amount of or all your cash, unless you get a special mortgage program to help you out. Detroit is all about Cash.

I think all my fellow Detroit Investors have great stories to tell you about banks not wanting to give you a penny to buy a property in Detroit, but if you show up to the same bank six months later with a paying tenant they will all of sudden take the house a collateral for lending.

When you touchdown, I highly suggest you do the "Slow Roll", a biking group, or running group. You will get a nice street level tour of the City and the neighborhoods.  Especially the neighborhoods "next" to the hot ones.  You will literally watch stuff change street by street, and you can figure out your plan, on top of course networking with Real Estate People locally.

I am in need of repair of a garage roof, and the garage needs to be painted.  Home is in Madison Heights, MI.  Anyone have a solid reference?

Warren and Sterling Heights are solid. I personally would stay above 696 or 12 Mile in regards to Warren.  South Warren is the New Eastside.

I say that as someone born and raised on Conner and McNichols where De La Salle USED to be. South Warren is just everyone from the Pershing and Osborne neighborhoods "escaping" the City.

Sterling Heights with Uitca Schools is a great value.  Also Clinton Twp is good, but avoid Mt. Clemens and Clintondale Schools.

I need a cleaning crew in SE Oakland County for a house.  Getting the property ready for sale.  Just need minor repairs, carpet, and walls bathrooms cleaned. House has been rented out for two years. 3B/1ba no basement 1100 sq ft.

Any references?

VA Appraisals/Inspections are VERY tough. Prob the toughest of the of the 3 big ones Conventional, FHA, VA.

The numbers look good...Don't get too far ahead of yourself in terms of moving on in a year.  All income nowadays need to be aged two years before it will pass underwiting(That way Fannie and Freddie will insure them).  So you will get dinged for the mortgage payment, but they won't count the rental income for two years(or at least two tax returns).  So you have a $600 hole in your budget.  I don't know what your income is like but keep that in mind.

Maybe take the money you are living "free" from and get you one of those homes through the Detroit Auction or Wayne County Tax Auction next year.  Then in 2017 all rental incomes will be aged and then you can move on and up.

Good rule of thumb is the tenant rent should cover the mortgage.  So at 90K 5% down with a 4.5% rate you are looking at $760/month for your mortgage/tax/insurance.

Not bad.  Numbers look good, now its about the property itself. Age of the roof, furnace, electrical...

I would run cable and internet to their unit and charge them $75 a month extra so they subsidize your cable, but thats me.

Go to Building Detroit(just google it).

They have some programs you could use...But living in it will get you there the fastest.  You could always live in it during the renovations then move out when they finish.  Its all about paperwork.