All Forum Posts by: Kristi Patton

Thanks guys for all of your input! @Barry Cohen that is exactly what I was hoping to do!!!

I have a message into the inspector that did the two houses to see if he could do exactly that!

So, still working on getting my first deal done and so far, my hubby and I have made 2 offers on buy/hold properties and ended up withdrawing both of them because of foundation issues found during the inspection. It would cost more to fix it than the houses would ever be worth!!!

Anyway, we are looking at older houses in lower income neighborhoods so we are aware that there will be things that have to be repaired, but paying for a complete inspection every time we make an offer could real expensive, real fast if we have to withdraw because of a big issue - like the entire floor of the house, including the joists, is sitting directly on the ground and is completely rotted and full of fungus! This was found during the inspection of the latest offer.

I have zero construction experience, but I assume that anyone with any knowledge at all of construction could have spotted that pretty quickly by looking at the crawl space during the initial walk-thru of the house and saved us the trouble of writing an offer in the first place. Is that a safe assumption?

Does it make sense to maybe pay someone with experience a consultation fee to go with us when we look at these houses and point out big ticket items or ("big rocks" as I call them) that could be a deal breaker or have a big affect on what we would actually offer on the house knowing an expensive repair is imminent? Then maybe when we have more experience we will know what we are looking for and can do it ourselves...

And, if we do that, should we still get a complete inspection?

For all I know, this is really commonplace and will end up being a big "DUH" moment for me...but this is literally a matter of not even knowing what I don't know! HA!

Thanks for your advice!

Hey Guys -

Chad Cumming at Gil Ragon Owen in Little Rock is a real estate attorney. He is pretty top notch.

Office- (501) 376-3800

So...after losing out on 4 properties for various reasons...we are about to bite the proverbial bullet! We have looked at more than a dozen properties, found 2 rentals we wanted but by the time we found an insurance company that could actually get us decent quotes they were both gone! Then we found 2 HUD properties that we wanted. The first one was gone during the owner occupant phase of the bid process and the other one we did actually bid on but did not get it. There is one left on our list of favorites that I feel certain we can get. Has been on the market awhile, has had several needed repairs and updates and unless an inspector says different does not need any majorl rehab just some cosmetics. I think we can get all in for $27,000 (at least that is our max) and depending on the appraisal we may not even have to put any money down on it. The rent for this house in this neighborhood will be around $525 so after mortgage, taxes and insurance the gross cash flow will be about $165 per month. We don't plan on taking any of that in profit but saving it to build a reserve for vacancies, maintenance and then once that is built paying extra on the loan to pay it off early. I know these are tiny numbers by most folks standards, but it might as well be hundreds of thousands for us! HA!!! Any last words of wisdom before the make the offer?

@Don Hines  - Hey fellow Arkansan! Nice to connect with another person from "my neck of the woods!' WPS!

@Alvin P. I live in Little Rock and am looking for rental property as well. Arkansas is a very landlord friendly state. I am working with a real estate attorney right now to get our LLC set up and for general guidance. We have referred business back and forth for awhile now and he is pretty sharp in this area. Let's connect and I will send you his contact info!

Thanks for the info! @Jeff G. do you mind me asking which insurance company you use? 

We are ready to make and offer on our first rental properties in Little Rock, AR. We are looking at purchasing 2 SFR in one deal. The houses are older and are in a low income neighborhood. We are having a hard time finding decent insurance. The quotes we are getting are for $1000 to $1200 per year per house and will not cover a roof over 10 years old. They are also quoting a flat $500 fee for $1 million in liability. That seems crazy to me. The houses are worth about $30k each. My own home is worth almost $300k and we only pay $1400 per year for insurance.

Does this sound about par for the course or am I missing something? Also, we are forming an LLC so is it necessary to have $1 million liability on each property or can our company carry an umbrella liability policy to cover both properties (and any more that we add...)? Thanks for any info you guys can provide!

@Trevor Ewen  - I will be more than happy to share what I learn when I finish my first deal! HA! About to make an offer on our first buy/hold property right now!