All Forum Posts by: Jack Payne

Hello group! I’m currently trying to pick a PMC for my new property and one of the things I’m most worried about is how the company handles eviction process. If a company doesn’t work with a lawyer directly is this a problem?

In addition to this, what are some big things to be aware of when signing with a PMC?

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Columbia, South Carolina

Hello BP,

I'm interested in utilizing an FHA loan and I want to know whether I can use one before I get married and if once I'm married my wife and I can use another FHA because she had never used one before? Is this possible or would it only be possible for us each to use an FHA loan for two separate properties before getting married?

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Jersey City, New Jersey

Hello BP community! Just wanted to reach out to see what everyone thinks about using leverage in today’s current market vs buying properties outright and potentially waiting until interest rates drop in the future in order to possibly refi. I know typically using leverage is great because it frees up capital that can be used for more deals, but would it honestly be better to just get a ton of equity by paying for a majority of the house upfront instead of letting interest rates eat away at potential returns?

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@Andrew R. Lucas thank you for the advice, I'll definitely check these out!

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Columbia, South Carolina

Quote from @Nathan Gesner:

Remember: cheaper doesn't mean you'll make more money.

Start by going to www.narpm.org to search their directory of managers. These are professionals with additional training and a stricter code of ethics. It's no guarantee but it's a good place to start. You can also search Google and read reviews. Regardless of how you find them, try to interview at least three managers.

1. Ask how many units they manage and how much experience they have. If it's a larger organization, feel free to inquire about their staff qualifications.

2. Review their management agreement. Make sure it explicitly explains the process for termination if you are unhappy with their services, but especially if they violate the terms of your agreement.

3. Understand the fees involved and calculate the total cost for an entire year of management so you can compare the different managers. It may sound nice to pay a 6% management fee but the extra fees can add up to be more than the other company that charges 10% with no additional fees. Fees should be clearly stated in writing, easy to understand, and justifiable. Common fees will include a set-up fee, leasing fee for each turnover or a lease renewal fee, marking up maintenance, retaining late fees, and more. If you ask the manager to justify a fee and he starts hemming and hawing, move on or require them to remove the fee. Don't be afraid to negotiate, particularly if you have a lot of rentals.

4. Review their lease agreement and addenda. Think of all the things that could go wrong and see if the lease addresses them: unauthorized pets or tenants, early termination, security deposit, lease violations, late rent, eviction, lawn maintenance, parking, etc.

5. Don't just read the lease! Ask the manager to explain their process for dealing with maintenance, late rent, evictions, turnover, etc. If they are professional, they can explain this quickly and easily. If they are VERY professional, they will have their processes in writing as verification that policies are enforced equally and fairly by their entire staff.

6. Ask to speak with some of their current owners and current/former tenants. You can also check their reviews online at Google, Facebook, or Yelp. Just remember: most negative reviews are written by problematic tenants. The fact that a tenant is complaining online might be an indication the property manager dealt with them properly so be sure to ask the manager for their side of the story.

7. Look at their marketing strategy. Are they doing everything they can to expose properties to the widest possible market? Are their listings detailed with good quality photos? Can they prove how long it takes to rent a vacant property?

This isn't inclusive but should give you a good start. If you have specific questions about property management, I'll be happy to help!

Thank you Nathan for all of this information. Super helpful! Is the information you listed the typical information on your checklist of questions when you are interviewing property management?

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Columbia, South Carolina

Hello everyone, I believe I found a potential first investment property deal in Columbia, SC that I would like to pick up, but I wanted to see if anyone has any Property Management companies in the area they recommend before moving forward. I’m currently in NJ, but went to school in Columbia, SC so I know the area fairly well. Please advise! Thanks

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Columbia, South Carolina

@Dave Skow

Thank you for responding! My father and myself will both be on the lease. The size of the houses I'm looking at are 3bed and 2bed or 5bed and 4bath. Hopefully that won't qualify as lodging. In reference to what I mentioned before about the CoC not being great do you think this will have a problem? Or will appreciation of house and increased equity improve this naturally or should I look for a house that has better CoC from the start?

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Athens, Georgia

Thank you so much for responding and the advice Kalim. I definitely considered the possibility of doing STR, but I like the concept of LTR more just because when it's not football season I could see getting bookings as a difficulty. The exchange program is an interesting idea though to fill that void so I definitely will have to think a little bit more on that. Could I possibly schedule some time with you to go over some good places students look to rent in the area? Please advise @Kalim Kalla

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Athens, Georgia

Hello Everyone!

I'm in the process of evaluating several houses in the Athens, GA area. Main pull to the area is the college town and renting to college students. My Dad and I are planning on going in on the deal together and he is willing to front a significant amount of capital for the down payment. I am currently looking at a few deals and due to the generous amount he is willing to front, I have found that the houses fall under the 1% rule and they have potential to cash flow. They are in good areas that are relatively close to the schools and bars, which is great! The only downside really is that when calculating the CoCROI the numbers are relatively low... like 2%-3%. Due to the location and growing population, which can help increase rent prices in the future, do people still view this as a good deal?

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Athens, Georgia

@Doug Spence

Thank you Doug. I currently am looking into college towns where I, or my siblings live/lived in just so I have insiders info or better understanding of these areas and what is worth it. My dad is going to be partnering up with me to take on the challenge so I actually should have some ease with access to capital for the first purchase! Any advice for finding good real estate agents in these places tho and how to screen them properly?

1 Vote

All Forum Posts by: Jack Payne

Jack Payne has started 6 posts and replied 14 times.

Post: PMC screening & Eviction Process

Post: FHA Loan Rules

Post: Using Leverage vs Buying Outright

Post: Property Management Company Recs for Columbia, SC

Post: Property Management Company Recs for Columbia, SC

Post: Property Management Company Recs for Columbia, SC

Post: Evaluating a Potential First Purchase

Post: Evaluating a Potential First Purchase

Post: Evaluating a Potential First Purchase

Post: Finding Hot Markets around the Country