All Forum Posts by: Matt Waggoner

 Hey Kyle, 

If you have any luck with a good contractor in the Toledo area let me know. Luckily I am not in need of anything urgent right now, but always good to have people to contact. 

Matt

Thanks to you all for taking the time to reply, I really appreciate your feedback. 

We are just starting out and we are both working full time, so the point in having a potential tenant portion to our website was to direct the potentials to the website where they can review the minimum qualifications. This would all be in an effort to avoid excessive calls or people showing up to our showings that are not good renters. I realize that there is no surefire way to guarantee good renters, but that said I really don't have the time to have bad renters. 

@Michael Smythe I agree and hear some of your points on 5 years being too long. @Laura Stayton I like the way you state your rentals aren't available with tenants that have previous court filings by a landlord, as only saying eviction may miss other legal actions. 

Thanks again!

I did a search about this subject and there was a post from back in 2014, but nothing recent. Worst off, there was a link with an example on how another company posted the minimum qualifications for pre-screening on their website, but the link was dead. That said I wasn't sure how to take that...maybe they posted something and got the pants sued off of them and they cant run their website, or maybe they became so good, they sold their company for $$$ and are sipping margs on a beach somewhere now. 

Of course I do not want to post anything that would discriminate against protected classes, and I am actually not afraid to take people with section 8 or other vouchers, so long as they meet the other qualifications. 

I was going to ad a section to our website for prospective tenants and include the information there. I am not overly ambitious or original, pretty much would take the qualifications from Brandon's book on Property Management.  Of note I am renting in Toledo OH, income sources can not be discriminated against, but what I am less clear on is whether I can require that a tenant make a certain threshold for consideration. 

Here are some of the qualifications I was planning on posting on our website. 

Applicant(s) must have current photo identification and a valid social security number.

Applicant(s) monthly household income must exceed three times the rent. All income must be from a verifiable source. Unverifiable income will not be considered.

Applicants must receive positive references from all previous landlords for the previous 5 years.

Applicant may not have any evictions or unpaid judgments from previous landlords.

Applicant must have credit score must be a minimum of 600.

A background check will be conducted on all applicants over 18 that will reside at the rental property. Applicant’s background must exhibit a pattern of responsibility.

Applicant must be a non-smoker.

I am also planning on posting a  disclosure stating that these qualifications are considered when looking at applicants, but all interested parties are welcome to apply. 

Curious to hear everyone's thoughts. 

Matt

I was out of town this weekend, but please keep this going, would love to try and attend next month. 

Thanks to all, 

I appreciate all your help with this, after your comments, I realized that I was probably getting ahead of myself and suffering from a bit of FOMO. Looking back that is a recipe for disaster. 

Luckily I have an out on the purchase agreement based on inspection. 

I love this community. 

Matt

Hello BP Community!

We are in our first year of our REI journey. We grabbed a 2 duplexes that were in decent shape and already occupied and renting for well under market value. 2 of the Tenants have been in place for >20 years and we don't have a ton of reserve, so keeping cash flow in place was a priority. We knew that we needed to replace windows and roof on units and planned to get these done in the next 2 years. We thought everything was going well. We closed on the property, then received a cancellation notice from our homeowners policy bc of the condition of roof. Our agent found another insurer, but this resulted in an increase of $800 annually to each property. We still cash flow, but its less now.

Fast forward to another property on the market near our home. We live in an area that is highly desirable and this home is perfect for renting. It was picked up for 55K in feb by a flipper who is currently selling it. They did some really good upgrades, and its nearly rent ready on purchase. My concerns are these. The inspection has seen bowing of the walls as well as deteriorated masonry. This home is from 1890 and has been ripped up and rebuilt a couple times based on our observations. Additionally the stairs that go to the 2nd floor are slanted. 

All homes in the area that have comparable specs are selling for close to 75K higher. My concern is that based on what I went through in the first rental, I am concerned about the ability to insure the property and if there are implications to renting based on the issues with the foundation and stairs. There appears to be no crawlspace and no basement. I am not sure of the implications with this. We are torn, because even this morning, we had a facebook post for a family looking to rent in our area for $1200 a month which means we would still cashflow about $300 per month after CapEx. There is nothing available for rent in the area aside from a farmhouse about 5 miles outside of town going for 2100.

We just don't know if these are issues that will prevent rental, create potential for legal issues, or have issues with finding insurance for the property. 

Appreciate any expertise as we navigate this potential purchase. 

matt

Hello All, 

After months of research and listening to podcasts I am finally in the stages of closing in on my first deal.  It could still fall through, but at this point I am looking at 2 buildings with a total of 4 units producing about $600 of cash flow per month after cap ex is considered. 

I currently live in Michigan near the Ohio border. The properties are in Ohio, but my plan is to purchase more units in the future that may be in Ohio or Michigan. 

I want to get organized from the start, and having an LLC I feel is a good way to go. I am just not sure where is best to file the LLC being that the income will be from Ohio, and I live in Michigan and plan to purchase units in Michigan in the Future.

I am planning on my own property management at first, but may contract this out later. I plan to have the income from the units deposited into a business account in Ohio and pay the Mortgages(in my private name b/c the LLC has no income yet) from that account to start the process of showing money on the books with income and expenses coming out of that account. My loans will be through a bank in Ohio.

I appreciate any advice people can give me. 

TIA

Matt

Thanks so much, Agree, a lot to digest. You prepare and prepare as best you can for starting with that first step, but there is a reason its the hardest step to take. It’s great that there is a community like this. Hopefully, someday soon, I am the one replying with my perspective and experience. Until then my greatest appreciation. 

Hi all,

Self confessed newbie here. I'm in the negotiation stage with a rental property I've been very interested in. Now that I'm getting closer to being a real estate investor, I am grappling with the realities of property management. In order to improve cash flow, I am electing to manage the properties myself, however, I'm planning on using a software to help streamline things. So if anyone has recommendations on property management software that seems to work well for them, I'm all ears. Additionally, I'm wondering about the lease agreement. Currently I am looking at taking over to duplexes. All four units are occupied, with long established tenants. They're all month to month, and I am needing to have them enter into a new lease. When I'm doing so, I'm trying to keep myself distanced from the tenants to an extent, I don't want them to know who I am, I have represented myself when I have viewed the properties as the person representing ownership, not the owner himself.

When I have the tenants sign their new lease, am I allowed to use the LLC that I am establishing as the parties entering into agreement? Or does this have to be with myself as the owner? I am financing this property, and the financing will be in my name, not the LLC. So if evictions are on the horizon, I'm not certain how the rental agreement will be perceived if the agreement is with an LLC rather than the owner of the property.

if others have ways or ideas on how to have a firm yet open communication with tenants, I'm all ears. My goal in purchasing rental investment property is to develop passive income, however, I understand that owning rental property can be anything but passive at times. I'm just trying to minimize problems for they start, especially since I'm inheriting these tenants.

thanks so much

matt w

@penda sarr I am also in the medical field and traveling doing Locums. I haven't started the road officially yet, working on getting finances straight and hoping to Capitalize on the pullback in real estate with inflation, with the plan to purchase around April to have any renovations done and open for potential June move ins coinciding with the change of internships and fellowships around the hospital. 

Though I'm not even a rookie yet, I have listened to no less than 5 books on real estate investing.  Because I travel a lot like you, I have found listening to the audible books helpful. 

I am looking to attend some meetings in the area to make connections now so that when I do start the process I can hit the ground running. I know there have been a couple meetups in the metro Detroit area. You might look into one of those to make good connections to help your business out. 

Good Luck