All Forum Posts by: Jason Foy

I think it would be hard to get a HELOC on a STR or LTR. It would be hard to convince a lender to over leverage your property, that lender would be second to your first mortgage. Currently with my LLC I need to use commercial loans which come in like 5-10 year terms Amortize over 30 with balloon in 5-10. I am a newer investor, so I may not be getting the best financing terms yet. The other problem I think with a STR is if you only have one the bank may question or have a hard time underwriting your gross income. I am kinda stuck in the same situation atm I have 80k or so equity in each property, yet can not refinance and pull any equity out and if I sell I need to 1031 into new asset. The only problem is with 1031 I can move to a slightly bigger property, I feel like my portfolio still needs to wait and mature a bit before I can make a bigger move. The better option might be to force equity in an under market deal and 1031 that into a new STR.

 That’s terrible. I have a property manager now I am not excited about. They do collect rent and I get paid each month, but sometimes it’s like cracking skulls to get a basic question answered. I think the restrictions in our state on becoming a property manager make it hard to have competition. You are required to be a licensed real estate agent working under a broker in Minnesota. I feel like this really limits the pool of good businesses as it takes 5 years to become a broker and very few people are interested in doing property management.

I am sorry that happened. I am not sure why they would have needed nail guns everywhere? Most of the work done in the field is insulation and air sealing related. Installing flooring, or trim is not allowed or common. 

We are usually blowing new insulation into the attic. Minnesota homes usually have an attic access or a gable vent is cut in. Dense  packing exterior walls in older homes or   adding spray foam to a rim joist and 6 mil poly in a crawl space. None of these measure would require the use of a nail gun. What exactly were they nailing together. I would love to see some pictures of the work if you have it. 

Each state and local agency does have its own standards and rules and Seattle is definitely a different environment then Minnesota.

I personally have overseen and inspected 6 million dollars of retrofits to homes. I am a certified building performance institute quality control inspector and energy auditor. Our programs require state and Department of energy monitoring. We are also entirely contractor based. Only two crew based agencies remain in the state. All work done is required to follow the Standard Work Scope or SWS. 

 I apologize for that agency and their employees. That is definitely not the normal experience across our network.  Although anyone working on a home can be a failed contractor, and mismanaging contractors can lead to disaster.

please reach out, I would love to document your experience.

Hello Everyone

I am reaching out to all Landlords and Rental property owners across Minnesota. I work with and help manage a program that on average spends and invests over 50 million dollars statewide into income-qualified dwellings yearly. I sit on the Energy Assistance Policy Council board, which provides oversight for the federally funded energy assistance program in the state of Minnesota. I also am a member of the Minnesota Weatherization Advisory Group and Weatherization Policy Action Council. These two boards help guide policy and development for the Department of Energy-funded Weatherization program. I have worked in the field for several years and I am a Weatherization & Housing director at a non-profit in Todd, Crow Wing, and Morrison counties. I also work with several large utility companies, which are required to spend a certain amount of their profits on income-qualified dwellings. I am also a real estate investor in central Minnesota. 

I am reaching out as across the state we need to service more renters. Overall 50% of people on energy assistance are renters and less than 2% of renters actually receive full benefits awarded to them under these programs. Our programs focus on lowering energy consumption, ensuring homes are ventilated properly & have efficient heating systems installed in them. The biggest measures we install are attic insulation, wall insulation, furnaces, water heaters, bathroom fans, rim insulation, smoke and co detectors as well as light bulbs and refrigerators. The overall arching goal of the program is to lower income-qualified people's energy bills, improve housing stock to be more energy efficient, and help keep rents affordable for those on a budget. 

These programs are less well known outside of Section 8 Housing vouchers, but we want to develop systems that we are providing equitable access to all of the people partaking in these programs. The benefits of a property owner are pretty outstanding. On single-family dwellings, all the measures we can install are at no cost to the property owner and on dwellings, up to 4 units still have no cost to property owners/investors. Once you get above 5 units each agency has some rules about some contributions given by the property owner.  This means a lot of times we can insulate attics, and install new furnaces, refrigerators, and other energy-saving upgrades on rental properties at no cost to investors. The overall benefit is it helps you save some money on upgrades that don't necessarily bring equity value but do bring value to your tenants and help save them a bit of money so they can more easily afford to pay their rent. 

I am looking for people who would be willing to have a meet-up or would have space for me to speak at a meetup about the programs we are using. I want to build awareness and systems that can ensure we bring that 2% number up to more like 50%. They are 50% of the end recipients, we should be able to get them resources and help you as a property investor at the same time.  Anyone who uses section-8 vouchers should be aware of this program as all your tenants qualify and would be an extreme help in a lot of cases.  

Thank you for taking the time to read this!

From my experience pets are a good money maker if you treat them right. I allow pets in all my properties under a few requirements. Worst case scenario pet leaves a bad odor in a house, thankfully you can ozone scrub a house and literally remove all odors from a home. The grass is also pretty simple to fix.  Around 40-50% of people have a pet, so saying no pets limits people, and i also prefer people not drop off their animals at a shelter because they want to live in one of my units for 1-2 years. Pets are family to people.

1. Non-refundable pet deposits usually ranging 300-500 per animal depending on the size of the animal. 

2. Find a good addendum and attach it to your lease for pets specifically

3. Your addendum should identify the tenant's liability. Tenant understands and accepts they are liable and responsible for their doings. Including inside and outside walls, carpets, floors, grass ect. Tenant will agree to restore the premises to their original condition at their expense if needed. Pet and pet waste are required to stay under control. 

as always we do a pre-inspection with video and pictures and have the new tenant sign off on the pre-inspection form. This way when they plan to move out you can reference those documents. 

Investment Info:

Small multi-family (2-4 units) buy & hold investment.

Purchase price: $160,000
Cash invested: $40,000

Purchased Small Duplex with extra lot zoned R-5 Multifamily
Rented it as a single family for now, since not all the requirements are in place for a multifamily
Planning to rehab this summer to increase rents several key things need to be done to ensure it can be a licensed duplex

What made you interested in investing in this type of deal?

At the time was very busy with work and needed to deploy some capital, so this building was mostly turn-key. All it needed prior to renting was paint, flooring, new toilets, faucets, and appliances.

How did you find this deal and how did you negotiate it?

Worked with our local realtor, and found it sitting on the MLS with really bad pictures and a long time on market during a very hot in demand cycle

How did you finance this deal?

Commercial financing through local credit union with 20% down

How did you add value to the deal?

Increasing rents, converting it to a legal duplex, and general small remodeling. The long-term play is to develop the land out eventually since it is a double lot zoned R-5 Multifamily and can hold up a 5-story multifamily building.

Lessons learned? Challenges?

at first glance, we thought it was a duplex since it has two units and separate entrances. However, we did do enough due diligence and found out through code requirements several things needed to be completed before it can be licensed as a duplex with the city.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

yes worked with a local agent who I would highly recommend if anyone needs an agent.

Hello, 

I am filling out my certificate of paid rent form, my tenant paid several months upfront but has only been in the property since 11/29/2020. The form asks Rented from MM/DD/YYYY to MM/DD/YYYY. Are they asking what the lease term is on the property, or are they just asking how many months in this year the tenant has occupied the property? 

Thank You 

I just got done rehabbing a house in which we painted a lot of the older trim. I wouldn't do it again, If you are looking for a good white trim, price out vinyl white PVC trim it's around a dollar per board foot, no painting necessary, low maintenance, easy to install, and waterproof. A little bit more than paint, but a lot less labor-intensive.

Investment Info:

Single-family residence buy & hold investment in Sauk Rapids.

Purchase price: $75,500
Cash invested: $5000

Single Family home purchased off one bandit sign. I pay a friend of mine, who lives on a busy road in the area I am investing in, to keep and maintain one sign in his yard.

The purchase price was 75,500.00
Invested an additional 25,000.00 in rehab
Currently renting for 1300.00 per month
3 bedroom 1 bath oversized garage in back

What made you interested in investing in this type of deal?

The owner had a really good location and overall large property for a fair price in this specific market. I would classify it as a type b neighborhood with home values in the 140-170k range

How did you find this deal and how did you negotiate it?

This deal was purchased off my bandit sign. I pay a friend who lives in the area to maintain and keep my bandit sign out in his yard. The road he lives on receives a fair amount of traffic. I have had roughly 15 calls total on this sign.

How did you finance this deal?

We used a 403b to take out a 50k loan
We used a home equity line of 20k
We paid the rest cash for closing

We financed the rehab by utilizing a rehab loan from a contractor to replace the roof, some windows, and a door
We financed the other repairs utilizing credit cards

How did you add value to the deal?

The property had not been updated for many years and had several areas in which needed repair.

- Fixed damaged plaster areas roughly 600 sqft total, I had to remove old damaged plaster, install new sheetrock and merge it with the plaster mud tape and texture these areas, mostly ceiling and in closets upstairs where the roof had leaked causing damage to the plaster
- Updated the kitchen
- Updated the bathroom
- New carpet
- Cleaned and painted walls
- Fixed electrical issues

What was the outcome?

Currently rented for 1300.00 per month
Working on the refinance option now
90 days from start to being rented

Lessons learned? Challenges?

- In the future, all trim will be replaced instead of painting
-Time estimated repairs would take was not enough, took 3 times as long than expected
- Its typically easier, faster, and more reliable to replace than to try and repair older equipment
- Most contractors are hard to deal with especially plumbers, building a better network of rehab specialists will be a larger focus on the next deal.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

This was an off-market deal
We did have a contractor replace the roof, clean out the drain lines, and install some new windows and a new door
We had an electrician help make the home electrically safe for tenants
We had a flooring contractor come in to install carpet in the bedrooms

Investment Info:

Single-family residence buy & hold investment in Sauk Rapids.

Purchase price: $75,500
Cash invested: $100,000

Single Family home purchased off one bandit sign. I pay a friend of mine, who lives on a busy road in the area I am investing in, to keep and maintain one sign in his yard.

The purchase price was 75,500.00
Invested an additional 25,000.00 in rehab
Currently renting for 1300.00 per month
3 bedroom 1 bath oversized garage in back

What made you interested in investing in this type of deal?

The owner had a really good location and overall large property for a fair price in this specific market. I would classify it as a type b neighborhood with home values in the 140-170k range

How did you find this deal and how did you negotiate it?

This deal was purchased off my bandit sign. I pay a friend who lives in the area to maintain and keep my bandit sign out in his yard. The road he lives on receives a fair amount of traffic. I have had roughly 15 calls total on this sign.

How did you finance this deal?

We used a 403b to take out a 50k loan
We used a home equity line of 20k
We paid the rest cash for closing

We financed the rehab by utilizing a rehab loan from a contractor to replace the roof, some windows, and a door
We financed the other repairs utilizing credit cards

How did you add value to the deal?

The property had not been updated for many years and had several areas in which needed repair.

- Fixed damaged plaster areas roughly 600 sqft total, I had to remove old damaged plaster, install new sheetrock and merge it with the plaster mud tape and texture these areas, mostly ceiling and in closets upstairs where the roof had leaked causing damage to the plaster
- Updated the kitchen
- Updated the bathroom
- New carpet
- Cleaned and painted walls
- Fixed electrical issues
- Fixed plumbing

What was the outcome?

Currently rented for 1300.00 per month
Working on the refinance option now
90 days from start to being rented

Lessons learned? Challenges?

- In the future, all trim will be replaced instead of painting
-Time estimated repairs would take was not enough, took 3 times as long than expected
- Its typically easier, faster, and more reliable to replace than to try and repair older equipment
- Most contractors are hard to deal with especially plumbers, building a better network of rehab specialists will be a larger focus on the next deal.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

This was an off-market deal
We did have a contractor replace the roof, clean out the drain lines, and install some new windows and a new door
We had an electrician help make the home electrically safe for tenants
We had a flooring contractor come in to install carpet in the bedrooms