All Forum Posts by: Michael Knaus

I too live in a rather rural area. There are about 4 local banks. I have a contact in each of these. It's an awesome idea to build a relationship with these banks. 

You have to get to the right person though and sometimes, that takes time. Like any corporation, there is a ladder. May take some doing to get to the person at the top (at least the decision maker in the collections dept) to actually start to build that relationship. Being persistent is key. The banks get calls ALL the time from newbies that just paid for a new career in real estate, asking for the deal of a lifetime. Most never follow up. If you are in the one staying in touch, you show some credibility. You are not a fly by night investor. 

Actually closing deals is what brings the real results though. This is why it takes time too. The more you close, the more they know you are legit. They will call you with deals at some point.

The problem though I find is they also have others just like me. It would be naive to think I'm the only one they know that buys houses. They want it sold for the most money they can get. Sometime they play me against other buyers and vice-versa. It's all a game and I just try to be the best option for them. The easier and more carefree it is to deal with me as opposed to the others, I think, is key.

Congrats on your first flip! Exciting times!

Assignment is something usually done when a lender purchases a portfolio of loans from another bank. The new bank is the now the mortgagee with all original terms remaining the same. They are now in the same lien position as the the original. The mortgagor is still bound to make the payments as if nothing happened.

When you assume a mortgage, you know step in place of the borrower and now you are the one sending the check! You are also now responsible to all terms or risk losing the collateral. Not many lenders allow assumption btw. Read the mortgage docs. I heard a VA loan may still be assumable. It's been a while since I have done that.

So assignment means you are the bank. Assumption means you are the borrower. Hope this helps.

Do you have an attorney? One that knows probate? What about inheritance tax? other liens? If it looks like a clean deal, I wouldn't do anything until you get that deed signed by all the parties and held in escrow until closing when it can be recorded. Have your own attorney or title company on your side for this one. Not worth free wheeling when it gets dicey.

I was going to write a book on this (but my background is swinging a hammer, not grammar) As a former contractor, I have heard so many horror stories from my customers. As an investor, I am now the customer and I see what they mean. The stories are never ending. You can't make this stuff up. It is one of the most challenging things about flips in my opinion. I have the background and the experience and I STILL have problems finding a good contractor. 

It's just too easy to get into the business, too much competition, not enough vetting from customers and , as a former contractor I can say this.....it CAN sometimes attract less than desirable characters. Even if the owner has it together, they most likely need helpers. That's where this gets REALLY ugly. If I were to create a graph or chart that shows out of 10 possible candidates to hire, and show the amount that have a drug or alcohol problem, you would be shocked. In my area, it's probably 7 out of 10. Yes 70% of the available workforce has some sort of addiction that they are dealing with. Construction, unlike many other employment opportunities does not always have drug and alcohol screening. Many owners just run an ad and hope for the best. The trades by nature just seems to attract this type of person because of this. These workers will only show up when they need a fix. Or if they do show up, they are impaired. 

Obviously this is not a hard and fast rule and each area is different but think about this. According to my calculations, you are left picking through the 30% that MIGHT make a good contractor. 

There are many ways to narrow it down to find the good ones. I will share just one for now. 

Go down to the local supply house, lumber yard, hardware store, etc and ask for the manager. Tell them what you do and what you are looking for. They will most certainly give you the name of a good choice. They will share a name that pays their bill, has a great reputation and is has been in it long enough to build a reputation with the supplier. They will NOT give you the name of some fly by night crew that drives a station wagon with a ladder strapped to the roof. They want to get paid so they will share the best. 

This name still does need some researching and the work is not over. It's a good idea to make sure they qualify in the other areas that need checking.

In PA you can go online. We have a county GIS map that was created by the tax assessment office. Maybe there is something online for your area? If there is no online resource, you can go down to the tax assessment office in person. They are not always in the same building as the courthouse so check first. Most have some kind of public access computer once inside. The office staff can help you search.

Not uncommon at all for an older tenant to complain. My grandmother used to wear a sweater to our fourth of July party. 

I had a brand new gas hot air furnace installed on one unit and that thing could bake a turkey if you left it on the counter. My tenant called at least once a week saying there is something wrong with it. Every time I went over there, it was 80 degrees in there and I instantly started sweating just talking to her. She was wrapped up like she was about to take on Everest. 

I told her there is nothing wrong. I bought an indoor thermometer from the hardware store and gave it to her. I told her to call me ONLY if that thermometer shows less than 70. 

First I'd actually drive by. Maybe it's actually vacant. If not, that does make it tricky. You can't really go on the property without being considered as trespassing.......from a practical standpoint however, most tenants or owners won't call the cops if you merely knock on the door and introduce yourself. If that were the case, every Jehovah's Witness or vacuum cleaner salesperson would be arrested. I think Hubzu puts that in there to cover their a**.  The tricky part is getting them out after you buy it. A topic for another post I suppose.

Is this a flip? If so most buyers (and their home inspectors/lenders/fathers/brother in law that's a contractor,etc) want to see circuit breakers. AND I think it's the right way to go anyway. Certainly safer and more reliable.

I say upgrade the service panel and any undersized/damaged wiring.

I can see where you are coming from regarding weight bearing but, most weight bearing walls on a standard home are close to center or perpendicular wall intersections making in impractical in some cases. The knee wall idea (done properly with top and bottom plates and 16" OC) will transfer and distribute the weight load across the entire length of the house which will in fact catch those intersecting bearing walls. If you keep the knee wall close enough to the eave (not out in the middle of the space) you are actually using the support of your end walls too. IMHO

I have to agree, I wouldn't worry. Have him remove it though for sure.