All Forum Posts by: Megan Phillips

After you run the numbers on the property, what numbers make sense to you? Your offer should be based on what you're willing to pay based on your estimates and what profit you're looking for, not on the number they threw back at you. Based on a quick 70% Rule calculation, if the ARV is 600k, and needs 250k of work, you shouldn't even be offering over 200k.

My lease states that any "guests" that stay for more than 7 days per 30 day period would need to be added to the lease (and obviously no smoking indoors). I'd be more concerned that the tenant had someone move in without any contact with you, especially knowing that you live there...? That seems like a red flag to me.

@Mark Wright hey, Mark, just show up! no sign ups

@Thomas S.  - Best at telling it like it is/reality check

@Dan Taylor

Well I read that whole thing and still don't know what a contrarian is... haha

Welcome to BP - I also come from a place where friends/family are just barely coming around to the idea of real estate being a good option (not that any of them will do it, but they stopped talking to be about how terrible tenants will be with there zero experience with anything). I, too, have connected with a few people via BP and other groups (ChooseFI, etc) and listen to the podcasts regularly. I think it's a little weird now becasue I have to intentially watch what I say to people about money, because my brain is always like "how much was that? did you save for it? what's your mortgage?" and I'm not being nosey, I genuinely like talking about people's finances and money and income and future plans etc - but I can see why people may think it's odd (I've never offended anyone that I know of, but I try to be aware that some people take money very personally).

It's hard when you have these interests but feel like you can't talk to people about them  - on one of the podcasts I think it was Brandon Turner that said listening to podcasts counts and should be included with the whole idea of "you are the average of the five people you hang out with most" - it's super corny, but I took that to heart because I was unable to talk to people about my interests and felt a comfort of knowing I was still "okay" because I was "spending time" with BP and podcasts everyday and still learning and growing my interest. I think if I keep investing in RE (and in retirement goals period, being debt free, etc) it'll show people that it is a good idea and could potentially help them too, that would be pretty cool anyway.

I don't know. I read the responses and generally agreed when people were saying to get a thicker skin and as long as payment is on time (and is a bit higher than average) to just deal with it and try to train better in the future and maintain their expectations... But. If my tenant told me "I don't want excuses, I want results!" the result would be a non-renewal. That's just rude and a level of disrespect I wouldn't endure. She needs to stay in her lane. Only emergency/necessary fixes from now on. Period.

She's a lawyer - when she demands that something get fixed yesterday, let her know that by LAW you actually have 30 days to schedule repairs (or whatever your state Landlord/Tenant laws allow for, my state is 30 days for non essential repairs). I'd get REALLY familiar with the Landlord/Tenant laws in the state where the rental is, but also wouldn't assume that she is... she just sounds like a needy tenant that is getting away with it. Know your laws, follow them, ignore everything else.

Never got quite that volume, but a steady flow of someone else's mail at my duplex after they left. Had to write "return to sender" over a dozen times, and left a note in the mailbox saying "Only deliver mail to x, y, z names" it still happened (I know it's not the carrier's fault).

The previous tenant never made any attempt to ask about old mail or anything like that. After several months, the items started making their way into the recycling bin accidentally. 

The OP sounds like someone perposefully using the address for an unknown reason and then they come and expect it to be like a customer service counter "here are your packages, Miss Doe, do you need help to you car?" 

If I knew they worked for USPS, I'd go talk to the postmaster where they work (or at least YOUR post office), and ask about having their mail being delivered to the incorrect address, and mention they work for USPS.

People are strange.

@Christopher Hall

I didn't read the other responses, but I set up a profile of your debts in an example payoff plan.

It shows your debts, and then the monthly payment for that debt.

"Total Payments" is what you're able to pay every month towards debt (I did 3200 + 2333.33 (10 month salary over 12 months)) which was 5533.33 per month. I didn't include your 550 cash flow from the rental in this, as I assume that is what you would live on (might be too little, but I don't know) ---- adjust the numbers for how they would actually work for you (it's undebtit.com). You'd have to add if you have a mortgage if you do.

Keep your savings as an emergency fund, and if/when you rent the 2nd place - add that to it and pay it off faster.

Using this pay down method, you would pay off ALL of your debts (including the ENTIRE 45k loan that can be forgiven in 9 years) in 2 years.

Don't need to sell the cars, don't need a second job, literally just don't blow your money and concentrate on debt payoff. You do need to follow a budget and not spend money you don't need to. You're not even close to being in trouble. Read "The Complete Money Makeover" by Dave Ramsey where he explains the "snowball debt  payoff method" -- or at least google it. That is what this chart is showing. 

Cheers.

I just double checked my numbers for my duplex, it cash flows even when considering an FHA loan (I said down payment was 3.5% in the calculation) and 8% vacancy, 5% repairs, 5% maintenance, and 10% management, $40 a month for electric (2 meters are 20/mo each that I have to pay for), $33/mo for water, $62/mo insurance, $35/mo trash, and $15/mo PMI.

It's not crazy money, but it does cash flow even after all of those expenses, even though the down payment was calculated as 3.5%.

I would at least target breaking even after expenses, even with an FHA loan. I would also seek other financing options so you could put 5% down instead and not have to pay permenant PMI.

I would consider saving as much as possible right now, and probably still renting for a while instead of this option. It hardly breaks even when it's fully rented - and that's after you upped the rent. There's no upside. If a couple of things break, you have to have an electrician look at something, a plumber look at something, or you have an unexpected repair, or a few months of not having a tenant, you'll be strained financially. When it only works if everything goes right, it's not a good deal.

If it doesn't at least break even (preferably produce positive cash flow) when adding in the expenses, it doesn't seem like a good deal.