Skip to content
×
Pro Members Get
Full Access!
Get off the sidelines and take action in real estate investing with BiggerPockets Pro. Our comprehensive suite of tools and resources minimize mistakes, support informed decisions, and propel you to success.
Advanced networking features
Market and Deal Finder tools
Property analysis calculators
Landlord Command Center
ANNUAL Save 54%
$32.50 /mo
$390 billed annualy
MONTHLY
$69 /mo
billed monthly
7 day free trial. Cancel anytime
×
Try Pro Features for Free
Start your 7 day free trial. Pick markets, find deals, analyze and manage properties.
All Forum Categories
All Forum Categories
Followed Discussions
Followed Categories
Followed People
Followed Locations
Market News & Data
General Info
Real Estate Strategies
Landlording & Rental Properties
Real Estate Professionals
Financial, Tax, & Legal
Real Estate Classifieds
Reviews & Feedback

All Forum Posts by: Isaac S.

Isaac S. has started 19 posts and replied 551 times.

$300 per month more means that if your turnover cost is less than $3600, it will take a year to recoup the turnover cost, but, the compounded returns in year 2,3,4,5,etc will be worth the pain now, IMHO.

BUT, if you are gonna be out 2 months rent $3600, $5k renovations/updates, it will be 2.5 years to recoup the difference, or if its 3 months and $10k....you can real quick have scenario where it takes 5 years plus to recoup the costs of turnover via the increased income...ALSO, another potential factor is if you need to refi soon to pull cash out, the higher income will potentially equate to higher value and loan amount, so the turnover expense now could easily help generate a large untaxable capital inflow

Good luck!

Their is no one perfect answer, you have to consider the investors total holdings and goals

Post: Qualifications for a C property tenant

Isaac S.Posted
  • Posts 563
  • Votes 561
Quote from @Steve Ehrman:

@Isaac S. Thanks for the reply. What would you consider the lowest credit score that you would consider, or do you have a lowest credit score?


In my limited experience(100+ lease ups) I would say that around 600 and lower you will start see multiple negative variables that usually overlap with my other non-score specific red flags.

red flags=instant rejection=previous eviction or unlawful detainer, felony conviction, vehicle repossession, bankruptcy, foreclosure, multiple collections items...if it's BK or foreclosure or multiple collections, they can be overlooked with a maximum legal deposit(2months in ca) if they have solid income verification

With C property you may have tenants with 400-500 score, because they have no credit history, or limited history with $50 unpaid phone bill or unpaid ER visit, they don't even know about because of moving around or just living check to check, BUT, they are a mechanic, heavy equipment operator, retail manager for 4 years at the same business that has been there for 50 years.... IMHO, it's more about do you have a job? Can you keep a job? Do you have high demand skills and/or solid experience?....when you drive around C neighborhoods, you will often see used car dealerships that have signs that say "...your job is your credit!" ...I find that mindset to have best results for me.

Post: Best way to collect rent

Isaac S.Posted
  • Posts 563
  • Votes 561

zelle, or any payment form that can not be reversed, disputed, or withheld by some random tech company that is not FDIC insured would be the first priority for me

then, ease of use for you specifically.


FYI, I recently assigned deposit cards for the nearest bank(5 blocks away BofA) to each unit of an acquisition, so the tenants can deposit cash, check or money order at the ATM and it has a date/time stamp, this was to accommodate this demographic's preferred methods of payment of cash or money order, without needing to actively involve management.

Post: Qualifications for a C property tenant

Isaac S.Posted
  • Posts 563
  • Votes 561

No previous evictions is my top priority, then income verification, then score and weight different negatives less/more(old doctor bill, student loans, etc)... best of luck!

You already self confessed to learning all the good stuff...best of luck and look forward to any updates on the drama

I am sorry friend but trying to justify this deal is futile, IMHO. To me it feels like your boots on the ground buddy is some kind of real estate guru or paid mentorship or online friend, I don't care if he has 900 properties, it was bad advise for a first rental property.

You can't save any money doing your own easy handywork. You can't save any money do the lease up. You can't meet any of your tenants before they move in. You can't do anything easily because it all includes 20 hours of driving round trip OR having developed systems and methods for out of state management of assets. AND with the easy lending money everywhere and therefore high level of competition you limit your competitive advantages so much.

Good luck, you certainly have confidence!

Wow, sounds like a very expensive mistake.

"rehabbed" is very vague....that could mean just about anything from $5k(new floors, a few fixtures, new appliances and paint) to $45k worth of improvements, considering the price, it's probably the low end...so your rehabbed property could still need a new roof, electrical updates, plumbing re-pipe, asbestos/lead abatement, etc, etc. and to top it off you're saddled with a section 8 tenant as your first. 

My thoughts are sell asap, even if you loose up to $10k, and  then use the money to make a better more sensible purchase.

I'll be interested to hear what other investors say, but I would never passed go with just one of these conditions, let alone all....no section 8 tenants, no interior inspection, no seller stories that ask for a high pressure fast close(unless some real good DD was provided to back it up), no out of state for a first investment.

I am curious what advice or experience made you think this was a good deal for you? 

I advise you to find a new wife
Invest in a bullet proof vest!

Pros...money from government can be solid, the tenants are willing to live in C neighborhoods so, it makes for a higher CAP rate

Cons...money from government can be turned off(above posts mentioned FL), your renters are in need of assistance(why?) from the government for the most basic of needs(food and shelter) so, they are gonna need your more managerial assistance as well, higher maintenance costs, more damage, more drama

If you are not experienced Section 8 provider with a good maintenance team, I would not encourage new investors to do it, one bad tenant can take years to recover from financially in a smaller portfolio

IMHO