All Forum Posts by: Kevin Zimmerly

Hey Kyle,

Glad you are taking the next step. I am an investor and a realtor in the Charleston Area. While I served in the Navy, I became a buy and hold investor and got up to several properties in 3 different states. This year, I have been involved in quite a few deals with rehab work required both personally and for clients. Some words of advice there will always be something you don't know in this industry, each deal is slightly different and has priceless experience that you can't get from a book. Analysis paralysis is a real thing and the unknown is scary and stops the majority of people from taking action. You took action today by putting yourself out there. I am sure you will find help in your journey especially in this group. There are many heavy hitters on here that are willing to help.

I look forward to answering your questions.

Respectfully,

Kevin

TY @Rachel Underwood! We are trying to do our best!

Hey @Bonnie Low, thank you! A CL-100 in SC is a Wood Infestation Report. It is performed by a qualified licensed Inspector to check for termites, other wood destroying insects, and fungi. Our project didn't have termites. It had a moisture content level in the crawlspace of higher than 20%. The lenders from the banks would not lend with that on a CL-100. So we had to add a vapor barrier, sump pump, and drainage and waited until it would dry out. Also learned that the contractors don't want to dry it out too fast or it will split the wood and cause more problems.

We had an ARV of $216k at the beginning of this project. It sold for more, but we also had more repairs done to the crawlspace, so it evened out. The timeline extended....we were shooting for 3-4 months but it ended up being 5 months after a buyer dropped out a week before closing.

Here is a link to the pictures.

Here are some before and after pictures of one of my latest renovation deals. 

This property is located in Charleston, SC.

This project started in the midst of COVID in March. I found this property and helped my client by negotiating the seller down $20k for all the work it needed.

Originally, this was a 2 bedroom with 1 bathroom and 1,044 sqft. If we would have left it that way, we would not have gotten the purchase price we were shooting for. We turned it into a 2 bed, 2 bath and opened up the kitchen. Another key item that isn't in these pictures, is that it had a 2 car detached garage.

Lessons Learned:

Crawlspaces can be a deal breaker. We had 3 CL-100's done on this property to fix underneath of this home. Vapor Barrier, sump pump, drainage all done after the rehab...cost a bunch of time and money.

Well Michael Barnhart we are looking at it this way,  when the court hearing is scheduled next month and the tenant is out. We will be able to clean up the property and resolve the issue with the city.  As for the fees and violations, I hope we can work something out.

Today was a whirlwind of emotions dealing with one of my properties in MI.  Short story is tenant is not following the lease aka... not mowing the grass and leaving trash everywhere in the yard.  Funny thing is I pay for trash, they just need to put on the curb. City sends my property manager and myself the violations.  We let the city know that they are not following the lease and we are not allowed to evict, so how are we supposed to fix this.  Court summons swiftly follows this including the tenant.  Tenant does not show up to the court hearing.  Judge decides to give more time and reconvene next month.  I take this as a win for now.  Their lease is up on the 31st.  My fear is if the outside looks this bad, the inside is probably not much better.  It is sad to see my investment get this bad, one tenant can cause a lot of stress and problems.  I did put a lot of work, energy, time, money into this property, but we just got to keep moving.  There are good tenants and there are bad ones as well.  Stay Safe out there.

Anyone dealing with stuff like this right now?

I agree Section 8 can be great strategy for times like these.  I have a few section 8 tenants. Just be aware that every section 8 voucher is different.  Some of mine only cover 25% of the rent.  So I get two checks one from section 8 and one from the tenant.  If I were to do it all over again I would try to get tenants with more substantial needs.  Meaning a higher section 8 premium.  Currently, I am going through a eviction with a section 8 tenant because he was late quite a few times last year and now won't move out.  This was all prior to this coronavirus scare. Next time, I will be a bit more picky when filling my properties.  Still learning the part about leave it vacant for the right tenant or fill it with a wrong tenant.  Even with Section 8, tenant screening is a skill to master.

As for the refinance question, look at the pros and cons. How much will you save in interest over the lifetime of the current loan compared to the new loan? Don't forget to add in the cost of the refinance. I actually did a HELOC instead. It has less cost up front and I still get to tap into my equity like a credit card. It does have a higher interest rate though if you are paying it off quickly it does not matter. Plus, once you pay it off you can use it again and again. Though, the amount of the HELOC can be as high as 80% of the Loan to Value LTV of the home. So if your current principal balance is 80% of the appraised value you would not get much for a line of credit.