All Forum Posts by: Margie Kohlhaas

Has anyone used this service? I came across this company and several others on this site: https://www.edhat.com/event/how-technology-is-transforming-the-way-real-estate-is-bought-sold

Congrats Erin! I'm a few hours north of you in Algona, IA. I'm new to Iowa, but I'm learning that most contractors are booked out 6 months - 1 year for projects. Yes, the weather (flooding, tornados, etc) creates extra additional work for them. I have lined up contractors and individuals to help with my rentals. We ended up investing in a professional paint sprayer ourselves since we end up painting often. Sometimes, it's best to gather up some friends for a pizza and beer party and just get the job done yourselves. Otherwise, you may have to wait til winter to find a good contractor. Good luck!

Congratulations! What an accomplishment! Are you using any type of property management software? If so, what do you recommend. Do your tenants pay rent online or how do you manage that? Thanks for the tips!

Thanks for the tip Jack! I live in a small town of 5,000. I'm not sure that HUD is trolling for me to sign up...at least not yet. I just figured it's better to let people know up front that I won't be accepting Section 8 as most of my calls are from people who have a difficult time qualifying or paying full rent. Going forward, I will most likely be posting my ads with some of the major employers (in their lunchroom or give flyers to HR). If I can target gainfully employed people at prospering businesses that would save me some time filtering.

I'm still learning all the Section 8 rules, but I state clearly in my ads that I am not Section 8 qualified. Hope this helps for next time. I'm not sure what I'd do if a tenant proposed something mid-year through their lease. Obviously, you want them to continue to pay rent, but it should be your choice to convert or not to Section 8 Housing and abide by their rules.

As a former California resident who has now moved to the midwest, I wouldn't invest 700K to get into the market if it won't pay itself off in 5 years. In the Midwest, you can easily buy a property and have it completely paid off by rental income within 5 years. A lot of people are migrating out of California due to high property taxes, low wages, and high cost of living. Also, it can take a long time to evict a tenant in California as it's considered their habitat. You're already in a great spot since you've got the Mayo Clinic attracting people. You could easily do a short term rental for patients. I was recently up there for a week and couldn't find a hotel under $200 a night.

I usually take out a 5 year personal loan for a small amount like this. If you cut out the bank and just use an attorney the closing costs are drastically reduced. This leaves some extra cash for rehab. Yes, my personal loan rate may be a higher percentage but if you look at all the figures I still come out ahead: short term payoff in 5 years vs 30 years, no closing costs, no hassles if I want to borrow against the property for more money (my unsecured loan is not attached to the property). I always make sure that the monthly payments will cover my payments, property management fees, property taxes + insurance, and any utilities. 

I'm in California and our $800k house will rent for $3,500. I choose to invest elsewhere as I would have to wait 30 years to see income return. I prefer getting homes that will pay for themselves within 5 years. The key is finding a cosmetic fixer that can easily be rehabbed and turn a profit in a short amount of time. I would look for an area that has good economic job prospects but a shortage of housing. Save money by investing in the outlying areas as people don't mind commuting 10-20 miles. You can often find a bigger & nicer house if you look a little further out.

I'm new at running background checks. I screened a set of tenants by reviewing income and application. Before calling references, we used ScreeningWorks to background check and I called customer service to help explain the reports. For example, on the couple we ran the credit scores it came back with one suggesting that we obtain a higher deposit since they had payment issues in the past. The criminal background only goes back as far as the state will legally allow it to. You'll have to decide your policy on any legal/criminal issues. Both tenants had criminal activity; however, the male had a common name and had never lived in the state where the crime was committed. The courts scrub the social security data on criminal cases so the screening has to go by registered addresses, date of birth, name, etc. If there's a common name, then the data can be wrong. Sometimes, these reports can be a bit tricky to read so it may not be a bad idea to share the report with the tenant if there's a question. Tenants may dispute their records if they are incorrect.