All Forum Posts by: Laticia Braxton

I totally agree with @Drew Sygit.  I don't think you should have to take this hit lying down.  They should compensate you in some way and although you don't have to lead with the threat of a lawsuit, do firmly ask what they can do for you. If they truly want to get to closing, they will offer something, even if they feel they are not at fault.

This reminds me of a deal I had a few years ago whereas I represented sellers who intentionally removed an expensive alarm system from their house the night before closing, when it was included in the purchase agreement.  The buyer's agent and buyers called me in a panic that night after realizing it had been removed while doing their pre-closing inspection. When I asked my client why they removed it, they blatantly told me that they never agreed to leave it (a lie), that they would not be replacing it and that they left the cheaper ADT system in place (for whatever reason, they had two systems).  The buyers flat out said they would not be closing the next morning if that specific system was not replaced or they were given a credit at closing.  Long story short, my clients refused to comply, the buyer's showed up the next morning but refused to close (and rightfully so), and my client refused to replace the system or offer a credit.  I personally ate the cost of the alarm system ($2,000) because at that point, tensions were extremely high, moving trucks were packed and on the parking lot of the title company where we closed and it was the only way we were going to close and each family could move on with their lives.  The buyers personally thanked me which meant the world to me and after a few days of dealing with internal frustration with my clients, I got over it.  

Point being, in your scenario, someone should step up and do the right thing.  I truly hope this works out in your favor.

Laticia

@Dylan BowmanIt’s my pleasure to help😊

I would also suggest that you self-manage to save those costs. That will be an immediate profit gain but the ultimate gain will be your experience.  Shop around for a lower rate to refinance and talk to at least three agents about selling.  They can give you a true and accurate value for the house.  Ask them what the current average days on market is in your neighborhood, ask them to tour the property so they can offer suggestions regarding repairs which may be called out during a potential buyer's home inspection, have them offer guidance on upgrades to add resale value, etc. Then, ask them to run a few closing estimate scenarios on varying sale prices, so you can see what your bottom line could be at each potential sales price point.  Once you have your numbers and data back from the agent, you can compare that to your refinance options and determine which route will be in your best financial interest.

Best of luck to you,

Laticia

@Randall Alan, That's such an awesome deal!  Thanks for all of the details you shared.  I'm taking lots of notes and am currently searching for duplexes in my area but they are not that easy to come by.  You just reminded me to pull out my wholesaler list :-)

Laticia

A nonfunctional HVAC unit is definitely better than what could have happened on Day 1. I'm sure with this being your first property, it may seem like a lot, but as others have suggested, it's not.  It is, however, a reminder that you now have a 24/7 responsibility and things will break and need to be repaired.  Get a home warranty so you have peace of mind and know what the financial responsibility is whenever things break.  Also, be sure you have a property repairs reserve to cover these costs.

That said, you hired a PM for a reason. I am hopeful that your PM was simply notifying you of the issue and not expecting you to resolve the problem yourself.  Although I partially understand the skepticism about your PM possibly trying to scam you, it seems a bit odd to go straight to distrust, if this is your first repair issue.  I think you should ask yourself why you asked the PM to have the HVAC company contact you directly.  You hired a PM for a reason and are paying them to handle these issues for you. The PM should be the one communicating with the contractor and should then be presenting the information to you and getting comparison pricing for the repairs, if the first repair quote is costly. 

If you feel you can't trust your PM, you should really self-manage.  As your first property, I would actually suggest that you do (if your schedule and lifestyle permits) because the experience you gain while doing so will help you tremendously moving forward in your investment career.  It will also give you more insight into why you pay a PM each month.

I hope your HVAC repairs are minimal and best of luck to you.

@Chris HeppnerIt's my pleasure to help Chris!

Great point @Karl B..  You should also draft a strong letter demanding documentation of the move-out, which should include the date they discovered the tenant had skipped.  You also want a copy of their rent ledger to review the payment history and see if they paid a deposit.  Next, ask them for a detailed inspection report including photos of your unit (before they start telling you it needs a full renovation to lease). From there, you should have enough information to determine if you need to get an attorney involved.

Best of luck to you!

Laticia

@Ying B. You definitely hired the wrong PM company. If those judgements were landlord related, that tenant should not have been allowed to lease your house.  Seeing as though they also failed to  get a complete list of damages during the moveout inspection, I suspect you were dealing with an inexperienced PM.  What sealed the deal for me, was you saying your complaints were met with dismissal.  I would check the agreement to see how quickly you can terminate the management contract because I doubt you will receive the service you are looking for with this PM. Just remember, you're paying them so they should be working for you, not against you.

Best of luck to you!

Laticia

@Eric James, you took the words right out of my mouth LOL!  Please check the legal requirements in your state.  Many states are now requiring PM's to be licensed, so know that answer before you have the conversation with her to protect yourself. 

If you're mainly interested in marketing & leasing, a lot of PM companies will parcel that out, for a fee (typically a full month's rent).  You should ask as you're interviewing.  There are also tenant placement companies, that's all they do.  Marketing is not difficult.  Use FB Marketplace, IG, Zillow to start.  There are also other cost effective marketing platforms available. 

What you may not have thought of yet and may find difficult is managing showings, if you have a job and/or a busy lifestyle. I'm sure just about every PM here will tell you that we've all had time wasted on no-shows at some point in our career. It can be very frustrating because our time is not anything that we can get back.  Prospects will confirm an appointment and still not show, so just be prepared for that.

If you decide to manage on your own, as others have suggested, you should definitely become well educated in your local landlord-tenant law, Fair Housing Law, etc.  Study it the same way you most likely studied how to acquire your first property, or the 10% you save in PM fees will seem like pennies if and when you are hit with a lawsuit. 

Best of luck to you!

Laticia