All Forum Posts by: Michael J Callinan

Our background checks automatically come with a credit check. About 9.5 out of 10 potential tenants don't have good credit. The reason we always check the credit is to see what they are spending their money on. I have seen scores around 600 because they have high student loans and their debt to income is out of sight. It also shows how many, if any, late payments they have which is a huge indicator. We tell them credit is a factor but we like to see the whole picture before we determine anything. There are some people who are very appreciative when given a chance and will treat the place better than someone with a good score. I would never skip the check. 

I personally would not be so understanding. If they called and gave a legitimate reason and its uncommon then yes work with them. If they are one day late automatic late fee and within a few days after serving a notice to quit. Tenants will test you all the time and until they know you're serious they will keep seeing what they can get away with. I wouldn't waste your money or time on coffee, serve them and if they call you then you can say how it will affect them. Treat your property like a business not a hobby. 

Until the signatures are on the paper that is pretty standard. If you were selling and you had two more offers that could bring your net up wouldn't you want to hear them as well? It stinks but there's plenty of other properties out there. Good luck.

The best thing whether new or experienced investor is to research your market backwards and forwards. Whether a recession occurs or not we are in a position where we are ready to buy or able to hold and cash flow. I'm sure many people in 2010 asked is not a good time to buy. The numbers don't lie and there is enough market data and properties to purchase with a contingency of a market fall of 20%. Be patient but diligent. 

Simple. in your contract with your contractor, put a beginning date and an end date with a clause that has roughly $150 per day late charge owed to you. If other things come up and they legitimately need more time write a change order or an addendum and come up with a new date so that late fee still sticks.

While everyone gets upset and frustrated in this business don't let it ruin your health. A year from now the problems you're experiencing will be a lesson. 

I work with a top agent in my market and we have had this conversation. He has plenty of reserves, knowledge, capability. That can also describe the thousands of other people interested in real estate but never pull the trigger, They're scared. Scared of the unknown, scared of failing, who knows. Everyone has their own excuse why they don't do something but majority of people like to stick with what they know and not venture out. 

I would look at this a different way. It appears to be a lot when you look  at it on a micro scale. Charging $25 to install something that probably took 15 minutes. When you look at what you had him perform how many more times is this going to be required? I would hope your smoke detectors don't move for 10 years, you don't have tenants that are damaging your doors and tile. Something I have seriously looked at the last two years is my hourly worth in a work day and 24 hours a day. If you calculate your time, travel, fuel, and costs to perform these yourself and it is below what you are being charged then take care of the items yourself until you're worth more to pay someone to do them for you. 

I would say it took about a year and a half looking at markets to even determine where to start. Once I found a market it took another 6 months to research, meet brokers, realtors, other investor to get the information I needed to make an educated decision on moving forward. It may seem like a long time but I have purchased over 20 homes in my area and now when some thing comes on the market I know immediately the arv, rents, taxes, and areas to stay away from. It probably took 10 offers and looking at about 80 properties to acquire my first one. 

If I had to choose one I would say It's having integrity. People can tell when you're being inauthentic or trying to sell them. If I say what I do and do what I say when problems arise I don't have any problem looking and dealing with them in the face. That way when problems do come around (never if but when) your investors, partners, lenders will still want to work with you because you did the right thing. 

I have not seen any hard money lenders work with anyone that doesn't have an LLC yet. I'm sure you can understand why they are requiring you to hire licensed contractors. If this deal doesn't work out, they own the property and the last thing they want is to re-remodel it because something was not done to code. If you are serious about getting started, start a business. I wouldn't recommend starting one with a friend. Things change as time goes on, you should each open one then purchase property as a joint venture. That way you won't have to split assets, cash, and other items if you choose to go your own way.