All Forum Posts by: Melissa Kirchhoff

@Dale E. - Hi from Ottawa! =)

Ottawa is actually a really great place for rentals, our rental market is in need and properties are fairly inexpensive compared to other suburban areas, we also have rentals in Marseilles, which is imo another great place to look.

One recommendation I have is join up some groups like Ottawa/Marseilles/Lasalle Co for sale or rent on facebook and you will see a lot of people posting rentals and people looking for rentals, I think it's a good starting point if you're unfamiliar with the market to see what people want and what there's the need for as well as comps and prices.

Every landlord I know gets tons of inquiries with minimal advertising in just a few days and so far our experience has been the same and actually, we've had some really amazing tenants (but we do tend toward A/B type properties so that may be why).

However, if you're not familiar with the area, I do think there's some quirks in this market, so I do recommend getting on those sites and getting a good idea what people are looking for before buying anything. I am not a native here so I guess there were some surprises compared to what you would think is desirable coming from the city or burbs!

Good luck and any questions I'm happy to help in any way I can!

@Cassi Justiz - Sounds good, thank you! I will check out the book, I had another one I liked as well that had these lists, but I was sort of flying by the seat of my pants on this and wanted some quick advice. The issue currently was to your last point, there are criminal records, but I'm not sure what I can accept or not without having issues with fair housing?

@Alex Smith - Good advice, that's what I was wondering. I will make sure I spell it out and have it signed! I appreciate the response!

For all the landlords out there, do you have a sheet or list of requirements for tenants, like a set thing like the 3x income and set credit score amounts and anything else similar that you would be willing to share with me to get me started?

Do you openly share this with tenants that are applying (like I was thinking leaving it out on the counter)? Or is it something you keep more in your back pocket?

So in my area, there's not a lot of people that do auction sites like xome.com or auction.com.

I've been considering a few different ones that seem like good buys. I know when I bought an auction home before, I was being bid up by bots like everyone on here said (I think one other real person bid for a bit but then it was just back to me and bot). I knew what my numbers were, so I didn't worry about going up, as long as I didn't go past my number. I ended up being just shy of that, so it all worked out and I got it for a steal. But if I remember correctly, I don't think it technically met the "reserve" amount.

So, I'm wondering, since there are a lot of different ones that look good and don't seem to be getting activity, has any investor just went out, thrown down the starting bid for lots of properties, and not worried about the back and forth part? Have you won even if the reserve wasn't met, just because there weren't any other bidders and the bank would rather take something than nothing? 

Just wondering if this was a tactic anyone has tried before (if their markets even allow it) and if you've had success? Have you won on properties that haven't met the reserve? Even by a long shot?

Watched the video, I don't think the IL thing is correct. I could be wrong but my understanding is the cap is 36% at a year, not that it keeps going up to 108% ... So I researched, the tax code they have listed with that clip says this:

So I'm back to questioning the information. 

Maybe someone else can chime in regarding the IL tax liens (@Emmett R. McCarthy?) the last time I was interested in one was a few years back (and was to get the property, not the interest) and maybe something has changed since then?

And then there's this slide. 

The county doesn't send you a check for the amount?! What the heck??

Either things have really changed, or I didn't have the right understanding of it originally, or this is just flat out complete lies ...

@Account Closed - No worries, I think all of us are just worried about you investing with them because they have that and getting yourself into a bad situation. You sound very cautious and thoughtful though so I think you'll be okay. They are informed in the sense that they know the system, but not in the sense that they don't know the markets. And from my experience, I wouldn't trust them personally with my money. I think they create their own ideas and numbers to support what needs to be supported and that can get people into a bad financial situation, where expectations are high and the results aren't there. And yes, with any third party situation like that, again, just do a lot of research and ask people on here, they are very helpful and many have walked down many different roads and can help us from making the same mistakes! 

@Ned Carey & @Account Closed -

I second Ned on this one. 

I have been a real estate agent working with PIP and I would be cautious regarding investments (and, honestly, any similar type of group, not just PIP). 

The problem is that you're using them basically so you don't have to do your own due diligence and can save that time. However, then you are putting faith in someone else to do it (correctly!) for you. Many tax liens that I see locally are purchased by outside investors. They purchase ridiculously cheap liens in nearby cities that are downright depressed (and due to certain, local issues, will likely never come back and have any real value) but outsiders don't really realize that unless they have someone local with the insider knowledge.  So there, PIP would be good, because they use local agents. 

However, I was often not listened to at all on my advice on pricing and such. I think it's because outsiders can't actually realize and accept how terrible some of these areas are. And even if it's a nice house (which most of them aren't!) the value can still be upsettingly low. (Seriously, there was an amazing victorian that went for ~30k.) Then, they have no real loyalty and will just bounce to other agents that will give them what they want to hear. I still watch those properties, and they sit on the market, because they are over-priced or over-improved and no one makes any money!

So, as always, it's about due diligence.

And as for other resources, besides BP (which actually, I struggled to find tons in terms of podcasts and stuff on tax liens, I wish they would do more on it!) the book  "The Secret Synergy Group System" by Jim Yocom had excellent breakdown (you could skip the whole beginning on why to do it) and has information state-by-state to help you understand what would work best for your particular interests. 

I invest locally, so I buy the lists and do extensive analysis. And also, if you can go the local route, I have a few neighborhoods I want to invest in, so I walk and drive those neighborhoods regularly and watch for ones with papers stacked up and that look vacant, and I will look up the PIN and tax on them to see if they are late or missed. 

If you can't invest locally, I recommend at least making a few trips out there and talking to locals/agents/whatever and trying to understand the nuances of the area. Why throw money (even if it's okay a few thousand, with tax lien investing it can add up over time and legal fees) for something that may not be worth it or have a return? Do your homework and don't be one of those horror stories! Good luck!

@Kyle Goodman - That sounds about right for what you should be doing. General updating and refreshing will help it sell faster and for more money. Also, take a look around at comparable properties in the park and see what they were selling for and what made them sell for more, that might help you see what certain features buyers are looking for.

@David Slamer - Typically, yes, you can still get any inspections. Usually what that means is that the seller won't be making any repairs (either because they don't want to or cannot afford to), so if something big comes up, you make the decision to stay or go, basically. You decide if you can live with it, or you walk away from the deal.

I don't really see it as a risk, sometimes those can be great deals, but it's something to consider because it may put you out the inspection money if there is something major. . 

@Ashley Hughes - I'll give you what I give my buyers I work with (as well as things I've used and other investors and agents have used to win multiple offer situations in the past) of course, they may not all apply or be right for you, but I think it's good to know you have the options!

First, get in there first. In situations where things are flying or if a property I know is going to be hot, I literally stop projects I'm working on to look at it. I do the same for buyers in your situation. If I can't, (like vacation or something) I pay another agent to show it for me or do a split.

Regarding offer:

1. Obviously, price. Know your numbers and if the numbers work and you think/know it will be in a MO situation, make a strong offer from the beginning. It will show the sellers you aren't playing around.

2. Financing - this I know isn't really in your control, but cash usually wins and from there it would go conventional, government. If you can move up in one, do so! But again, usually this is sort of it is what it is type situation.

3. Close date. Again, if you're financing, you're restricted slightly on this. Try to get every document your lender can possibly use to them before the offer and be as ready as possible. Ask them if they can do less time if it means winning an offer. Some will say 45 days to be comfortable but with government they may need it. Also, if you're still shopping around on lending, this is a good question to ask!

4. Other contingencies:

- Ernest money - Honestly, to me, as an agent, EM is completely stupid. I won't get on that tangent though. For sellers though, it's the fuel that makes their world turn. Putting more EM down (don't go crazy, but do more than average for your market) makes your offer look much stronger and you're still protected by clauses and the contract to get your EM back (but remember, the seller does have to sign to agree so it can tie your money up for a while!)

- Attorney review - this is something I've crossed out on offers personally. Again, this is something you have to feel comfortable with (and this one isn't really huge to most sellers unless they've had someone tie up a property just to give them more time to think or something)

- Inspection - Same thing, I've had contractors and people through with me and give me a general idea. If I know I'm going to buy the house anyway, then it doesn't really matter to have the contingency on there. Now, if you planned on getting one, don't cross this out! Buying something and finding out there's major roof, foundation, etc issues is not worth winning the bid! But if you have someone that was going to do it anyway or if you knew the inspectors you wanted to use could get in and get you the report back in 3 days instead of 10 business days, use it! Put that on the contract with maybe a few days grace period and if you still have attorney review then that can always be changed (but both parties will have to agree to it).

- As-is - This is another good option if the property isn't being sold as-is already. What it will mean is you can still get the inspection if you want, but you won't request repairs or concessions. It's basically if there's something major discovered in inspection (and found during inspection period) you can just walk away. Again, some sellers are happy to know they won't have to keep throwing money at it.

- Survey - I don't think this is really a thing done everywhere, but around here, it can cost around 350-400 for a normal city lot to be surveyed (greater for more land) and can be pretty expensive for the sellers. If this is something that doesn't matter to you (to have the survey done and the property corners staked) then it's a good thing to eliminate. Around here, our city won't really raise issues with anything that's been existing (I sold a house that literally the entire porch was technically in city property and it's never been an issue) so most buyers and sellers don't care about the survey unless the property lines aren't clear. Don't do this if you've had issues in your area. And beware of asking people with the old wives type tales. Ask people who are in the real estate world. With any of this, I'd talk to some local area investors and get a good agent behind you that can help with these things and advise you of the pros and cons of each.

In some areas, I've heard of writing letters to the sellers, or even giving a acceptance type gift (like for real, other agents have told me in big markets that they will give the seller a non-refundable $25k upfront to accept (even if there's like an inspection issue or something! WTH?! And how do I get in on that? lol)) so there's alternative things to consider (though I would never do the latter one!) and the letter might be more for someone emotionally tied to their house, not a income property, but hey, no real harm in trying!

Also, my quick hippy side has to speak. I tell all my buyers this when they lose out. Believe me, it happened for a reason. I've lost out and I look back and go, wow, better things were in store and I had no idea! I spent time being upset and now laugh at my luck. It sounds stupid, but I believe in it, and any buyers I've had that have lost out in MO situations, it's resulted like this too. One actually lost out on the house next to his parents (and he went way over asking (and cash!) in a market that RARELY every went above list!) he was insanely upset (and this was like his third time losing out, I felt like a failure!) and in the end, he was thrilled that it worked out the way it did. He liked the house he got much better, and he grinned and told me it wasn't so terrible to have a little space away from his parents. lol (it was only like a 5 min drive but I think that was 5 minutes he appreciated!) So have a little faith that things work out for a reason and don't get too bummed out about losing out, I know the feeling! Good luck!