All Forum Posts by: Kate C.

Hello, BP community- I posted these questions four years ago and got some good advice, but I never acted on it. Now the scenario is a little different- I welcome any suggestions and advice. My father used to own a 4-unit rental property in a location near a college campus for 20 years. It is all paid off. He vested the property over the last 14 years.  He also generously vested to his two children and a nonprofit he founded. (He has not taken a salary from the nonprofit in 20 years- but the proceeds go to a cause he cares deeply about)  Currently, my sibling and I own 40% of the building, and the nonprofit owns 60%. I am grateful. I also don't know how long-term capital decisions will be made when the majority is essentially owned by a board of directors once my dad passes away. It is managed by a company. He is in his mid-80s. I am considering selling a single-family rental in DC and/or looking for a new commercial loan to purchase the building as much as I (or we if my brother decides t partner with me) can to be a majority owner. My brother may also be interested in purchasing a portion from the nonprofit. What would the first steps be? Can I sell a single-family rental and do a 1030 exchange for a multi-unit?  Does the fact that a portion of the multi-unit is owned by me and a nonprofit matter?  If I don't sell the rental, what kind of lenders offer loans so I can buy back the other portion that was gifted to the nonprofit?  We agree that partially owning this asset may not lead to wise management and decision-making over time. Thank you! (especially for making it through this long post)

Have you tried rentometer?  https://www.rentometer.com/

I want to thank everyone for their contributions. Each of you has given me a great deal to think about about reminders of some important market and REI concepts.

Hi Joe. If we refinance the rental with a new 30-year loan-(getting 500 or so out with a new loan at 7%)  it will break even short term or have minimal cash flow. If rates go down, we could refinance then and expect more cash flow. If we hold onto the current home, it will do the same. Rents could cover our mortgage, interest, and taxes- but minimal to no short term cash flow. Our strategy with the rental was to build equity and hope the eventual cash flow, once it is paid off, the investment would help us retire it have cash in retirement (our goal has always been to have a longer-term investment). I hope that clarifies. Thank you for your time. 

Hi Henry- No- it was purchased as an investment 10 years ago with a 15 year loan at 3%. Thanks for your time and consideration. 

Dear BP community- Thanks in large part to this community and a hard work - we are in a good position but have to make some decisions about a possible move for a new job.  We purchased a home in CA three years ago for 1.5 M and have a 1M loan at 3% interest. We anticipate we could sell it for 1.7M. We may need to move for work unexpectedly. We are considering the smartest way to purchase a home in the new location- sell our home and use proceeds for a downpayment or rent our current home and use a cash-out refinance from a rental we have in DC. I have read a great deal about this issue and realize this is not a unique scenario and very good position to be in.  We have an investment home in DC with equity (750K) on a 15-year loan at 3% due to be paid in 5 years. While at some point I know we will need to talk to a financial advisor who understands our specific situation, I am curious if any of you in this community have had a similar situation, or given this bit of information, would have advice. Do we let go of a large low-interest loan to get the money needed for a new downpayment (estimated 750K profit) or tap into equity from a rental since the interest is deductible and get a new higher 30-year loan on an investment that is almost paid off?  Thank you very much for any ideas or suggestions. 

Hello- I am three days from the deadline to remove contingencies for an offer on a (420K) one-bedroom condo. The inspection found the AC unit works but will need to be replaced, and the electric panel works but is unsafe. I am working with the selling agent. She just wants to close the deal. If I request a seller credit for 8 - 9 K and the seller does not accept, can I get out of the contract and still get my deposit back? Thanks!

Hello- For context, I am in escrow for a one-bedroom condo in LA that appraised at the offer price of 420K; we are putting 40% cash down. The inspection cited the need for a new electric panel; the current one works, however in n the words of one electrician, "It is Zinsco panel must be changed". In addition the inspection showed the AC is very old (20 plus years) works but is likely on its last leg. Plus- The condo is being sold without a refrigerator. I would like to ask for a seller credit to cover the costs of a new panel ($2,000)  The selling agent lives in the building and is trying to convince me everyone in the building has that same panel,

and it is not a problem. Because I am using the selling agent, I am not sure she is proactively wanting to negotiate on my behalf. When I bring this up, she suggests taking advantage of the home warranty plan that will cover costs if something breaks.

I would love to hear your reactions? Is a 2,000 seller credit reasonable? 

Hello, My father has vested 60% of a multi-unit to his nonprofit. 40 % is owned by his two kids (my brother and I own 20% each).  Does anyone have advice on purchasing a percentage of the building back from the nonprofit? He is getting older, and we would like to support the mission of the nonprofit but also think over time decision-making for the building would be easier, over time if we were majority owners of the building. Any general advice or experiences with something similar? 

Thank you, Joe!  I appreciate this down-to-earth and honest reality check. Your takeaway message seems so common sense, but an important reminder- Profit is good. Taxes are high... I am folding in the reminder to be grateful to be in this position.