All Forum Posts by: Ihe O.

 I would take it step further.  Buying all cash isn't investing at all.  It's simply withdrawing you money from the bank, and then depositing your money in a house.  In both cases, your money is dead, since it isn't moving.  Invested money/cash should be moving.  The word "cash" isn't a noun...it's a verb.  When it becomes a noun, you lose.

As a investor you understand that it is smarter to own 50 properties purchased with financing than 10 properties purchased with all cash. Diversification is your safety net creating 5X the returns on your investment and 5X the potential appreciation. When you buy with cash you are less diversified and have all your own money at risk in a concentrated investment. Diversification uses the same amount of your own money but transfers the majority of your risk to your silent partner...the bank.

It primarily boils down to a indivulaes business skills. Cash hoarders do not use business skills. Rather than invest they simply stockpile cash in real estate.

Or you can look at it as a form of Charity that year..  its not like this happens often.. i get your position Jim you work at the pleasure of your clients its not your decision..  But for me if this was one of my tenants you already know what i would do if I knew for certain someone had terminal cancer.. they would simply be my chairty for that period of time..  Heck i let people stop paying rent if it gets too cold and they cant heat the house .... I can see the undercapitalized landlord though freaking out.. they are in a no win position.. if you cant stay afloat missing 3 yo 6 months of rent your in bigger hot water than you realize regardless.

 I run a $50M+ portfolio, so there's that.......I'm sure many other BP members run even bigger businesses than that. Even if they didn't if one way is proven to work better I'd imagine that one would want to use that way no matter the size of their portfolio.

I understand that is your thought process on the topic. What I am saying though as it doesn't actually work out that way in practice. It's a proven concept that evicting as soon as rent is not paid will result in an overall higher ROI for a landlord then one who "works things out" This is why all large scale rental businesses operate this way.

 Na, disagree with you. From a financial standpoint there is no such thing as working things out in regards to rent payment. That is terrible business practice. It must be paid or they must be evicted immediately. If working it out makes a landlord feel better more power to them. But trying to work something out does not make a landlord anymore money.

I see some folks on this thread are advocating working with the tenant or helping out. While others (including myself) are adamantly against getting personal with the tenant or helping out. 

Case & point there is no financial benefit to the landlord to get involved in personal matters or helping the tenant in anyway. Cancer is irrelevant. It's pay rent or be evicted per the lease agreement when looking at this from a purely financial standpoint. There is no sense arguing that helping the tenant out or being compassionate will have anything other than a negative effect on the bottom line.

That said, some folks get more out of their business then just the bottom line. So if anyone wants to be the nice guy or show some compassion that's totally cool. That's their prerogative. They may find more happiness in doing that than making some extra money. Money doesn't mean anything if you can't sleep at night. It just needs to be understood that doing anything other than ignoring the cancer & anything going on in the tenant's life will decrease the profitability of the business.

Read your state landlord tenant regulations. If you understand how the process works you should know that a landlord issues the pay or quit notice the day following when rent is due. This officially gives  "notice" and begins a process to collect or evict. It is by no means a immediate eviction and once issued the tenant is in full control of the direction it takes.

Just to make sure you understand....once the pay or quit is issued the tenant is in control. They may choose to pay, leave or force their landlord to evict them. This is not a landlords decision it is the tenants. Tenants only get evicted if they choose to be evicted.

Responsible indivulaes pay there debts. That's life. No free rides.

@Ihe O.

Sensible for one business could be hours or days or for others months.  Some types of businesses can spread their risk over thousands of accounts and some can not.  Does not make either more or less compassionate

I didn't see an answer to the other question as to whether compassion or contingency plans only go one way ?