All Forum Posts by: Matt A.

Actively re-starting about 2 1/ years ago in RE investing we began to consume a lot of material on investing (podcasts, books, etc.), the end result being we took our eyes off the ball to the deals that were right in front of us! We have several smaller multifamily properties, nothing big & sexy, rather GOOD solid money-makers with good tenants that we don't have to (anymore... after one inherited tenant eviction) chase people for rent. To that point we began to look at larger properties in the 50-150 unit range. I still view them as no real difference than the little ones - takes the same skill set (for the most part) and time investment as a SFH or a Duplex... however there are a LOT of folks making noise in that market that haven't even done a single family house deal either.

I get why a broker doesn't want to talk with people... LOTS of "new" syndicators, a lot sound like like seminar junkies from the "back of the room vendors". Anyway - Were still evaluating these and it will happen, just not yet (and Im not looking to syndicate either).

The whole point I'm making, DON'T loose focus on your backyard. Where I'm located the housing stock is predominantly quads and smaller... and its almost all converted SFH that are 100+ years old to boot (translated = rotted sewer lines, knob & tube electric, lead paint, asbestos siding & pipe wrap)... all the things that say OPPORTUNITY... and I've been missing it for over a year!

My wife @Kristan Avila and business partner gave me a solid kick in the butt several weeks ago as we hadn't done a deal in a long time. To that point I'm also looking to rapidly accelerate what we have in our portfolio... not executing on deals isn't the answer. We ultimately spent a week researching LOCAL deals again... and guess what, we closed a duplex last Friday, marketed the vacant unit while under contract and that unit was signed this past Monday as well. Listen to enough @Michael Blank and you'll recognize his theorey that the second, third, etc. deals come in rapid succession as well. Where I'm going is, while this is not large apartment building investing, it is solid, money-making multifamily, and just 6 days after closing and 4 days after filling up that property, my wife and I have yet another duplex under contract that were closing on in 2 weeks (this one smells.... of opportunity! remember the 100+ year old part... its a bit musty, but we can fix that)

My goal is to hang up the corporate gig in 24 months (and yes, I said that 12 months ago)... now getting some more doors in the portfolio will actually allow that plan to unfold. Bigger boxes look very enticing, then again there is some good economies of scale in our market to capture several buildings in a 5-10 block area and create great value there as well. (do need to thank the posdast guys, they have invested a LOT of time in creating the content and sharing the nuggets. BP, M.B - J&G... there are a bunch out there that were all learning from )

Don't step over the dollar to pick up the dime - just keep your eyes open to whats in front of you and it will come into focus all on its own.

Kyle - I just closed another duplex in the area last Friday... it will take some "management" work to iron out the kinks, but this is how we find opportunity. The property itself is fantastic... inherited tenant not so much, BUT, there was a vacancy & it was in the contract to let us market it while under agreement. Im happy to say

The area overall is like any other, good - bad - "no go" zones. Spend a little time over there and you'll get a better feel for the nuances. I personally dont go into the west ward or south of the river. I use "great schools' as a rental tool - tells us a fair amount of where our residents want to live. 

Ill be happy to chat off-line as to where we go and how we run our numbers. Were getting phenomenal returns and helping turn the neighborhood into better places - getting the property is just the beginning.

@Shonda Williams - sounds like your doing the right things, DONT get discouraged over this experience... rather chock it up to education! In this business you can make some incredible income (i.e. follow Robert Kiyosaki and structure accordingly), meet some great resources and people (take a look at the answers you got here), and build something incredible with leverage.

I went through my firs eviction last year - it sucked, consumed a lot of time and resources (especially emotionally... seemed all we did was talk about the jack@$$), and generally took my eye off the ball for a couple months. I had a seriously ripped-up unit to contend with afterwards (in full disclosure, I bought the property with one unit that needed rehabbed - I just didn't plan for THIS big of a a job) that took a couple months to get back on-line, but it will all work out in the end.

Try buying THAT education at a community college (and in reality this only cost  between a grand and 1500 or so AFTER deducting the judgement from my taxable income last year)!

I signed a new lease a week ago and the unit is NETTING an additional $5400 annually (and that too will increase annually by 5-7% as its only the INCREASE in rent, not the entire amount). Spreadsheets are great, and once you get hooked on this kind of investing - realizing that YOU control your destiny and future, you'll become unstoppable. Use this community as there are many folks willing to share, but also give back - that's how it works.

So you've heard several people inputs regarding the issue, accept a partial - cut it off and go to court - wait for the lease to run out... all kinds of variables. YOU have to research whats right for you, you have to decide what risk/reward your willing to accept, and lastly YOU have to decide if your going to run a tight or loose business. There are valid reasons for all the answers - make an informed decision and move on... best thing you can do.

 DON'T screw around with this tenant. What Im not clear on... how many units you have (its psychological loosing that income stream) and its is your first, correct?

Take all the necessary steps immediately. The clock is ticking against you if you wait. I had to start the process in early August with a tenant - took till late November to be rid of them (and that was me showing up WITH the sheriff to remove them - fortunately they moved at the last possible moment). While they did have to pay rent to the court while appealing,  Im still out a months rent and attorney costs - all said its close to $5k in total. SCREENING is important (this was an inherited tenant that came with the building), once you get them out take your time and don't compromise on screening/standards... you'll just repeat the eviction.

Good luck - and as has been pointed out, get moving... time is not your friend on this matter.

One thing, IF you start the eviction SHUT HER OFF in COZY... that WILL allow partial payments and your screwed in the courts. Cashiers check only from here out.

@Yvonne H., I was setting up a new lease and found it in the lease terms.  From the "payments" tab on the left, hit "rental details" on one of your tenants, then edit "RENT"... it should be in there.

Remember, this is supposedly a beta feature they invited me to (Ive been pretty loudly asking for this feature for some time). Im not sure if its been rolled to the community yet. Please let me know if you find it as well.

Matt

@Yvonne H. - agree that moving to another platform is going to suck, but disagree on two points. I DO get automatic late payments on the cozy platform. In full disclosure it JUST STARTED for April collections, and I had to update my lease terms for all units... but it is there. On the other hand its NOT robust - just a simple flat amount and "X" number of days.

Im also getting an email summary in the evenings when tenants make a payment. Im billing some utilities (water, trash in some cases) and cozy does send a summary when a tenant initiates a payment - very similar to erent.

Im in agreement 100% that its a real PITA to make a third move to another platform, Ill personally cross that bridge soon as we close on the next building. Cozy is fine for a handful of units

@Ben G. - no idea when it may move to production. I "found" it about a week ago while inputting the terms for a new lease... then a couple days ago I received an email about the "new feature". I shot back a response rather quickly with my suggestions, however Ive personally found them to be more lip service than action... although I was pretty adamant 6-8 weeks ago that they were missing the boat by not having this feature.

No idea on their plans, and they dont seem to share lots on their site either. Im using it as it works for the few buildings that we currently have... soon as I add one or two more its absolutely time to move to something more robust.

I cant believe people still trust ErentPayment after last years debacle! Rick Sands handled the issue horribly, folks lost a lot of money and I still have never received an explanation from the company as to what happened - but furthermore what THEY were going to do about it.

Im using cozy now - and it does have a few shortcomings compared to erent. @Yvonne H. - automatic late payments are in the system (at least for me... they claimed I'm a beta tester), albeit only simple "late fee" based and at "x" days. I've requested both THIS option as well as a daily late fee - its not coded into their system yet and I keep hearing "what a great idea". They aren't perfect, but as other have pointed out, they are still free (to me).

I absolutely agree that this platform wont scale past the units we currently have. This HAS become a business ranter quickly and appfolio / buildium / etc are going to have to replace cozy sooner than later for numerous reasons. You really have to think about getting out of the "Ima" (Ima gonna do this... Ima gonna do that) mentality, hire the experts in their field and focus on BUILDING the business. Its easier said than done, but one heck of a goal that we are striving for this year.

@Nick M. - get a lawyer on this one. I had the EXACT same issue, and recently got the guy out (as in 10 days ago recent). If you go through the magistrate's office AND he appeals you're going to wind up in Common Pleas court (this is NOT a DIY court, you want a competent lawyer that knows how this works).

I inherited a "professional tenant" and now we are in the rehab phase... even more costly. Fortunately there is light at the end of the tunnel.

Lastly, Ive said it before, but you CAN do some level of screening while in the due-diligence phase (at least in PA) using the PA Judicial search (google that). Look under "magisterial / landlord-tenant" (not exact, but close) and you can put in the names on the leases of the properties your considering. Its a decent free tool. (i.e. "tuition" as some folks say).

Good luck

@Christopher D. - get on Facebook and search "erentpayment discussion group", join that and there is a TON of information regarding eRent. About the only way to get this handled is through the R10 process. THere are several resources in the FB group on how to do that with links to documentation from ACH personnel that explicitly tells the banks to do it, and why. Also has contact info for the ACH people should the bank have any issues.

As eCheckit is in bankruptcy you need to move quick. Ive found that offering a substantial incentive to your tenant will give them motivation to go to the bank again. Look at it this way, would you rather collect 100% of nothing or 75-80% of your rent? (get my drift on "motivation")?

I met with several other landlords over the weekend in Knoxville at a Multi-Family event, @Lucas Hall (he is a senior guy with Cozy) was there and went into great detail on what happened, and how cozy is different. Im in the process of moving to cozy as I type this. If you have direct questions please PM me.

Good Luck!

Matt

I have - only ONE tenant that was affected, they had tow payments they entered on the 12th, rent and the automatic late payment. The rent was transferred out of their account immediately, the late payment (significantly smaller) was not. BOTH showed as pending for weeks, then the late payment was deposited into our account last week. The larger rent is not... Im attempting to have the tenant claw that back with the R10 process. Been working with the local bank and also offered the tenant $250 as an "assistance incentive" (that's large enough that they are vested and don't view us as greedy, rather a partner - and taking it on the chin for $250 is far cheaper than loosing an entire month to this crap)!