All Forum Posts by: Michael McConlogue

Just want to make sure you are aware of the new Smoke Detector law going into effect this April. Here is a link to some info which has a link to the law. https://www.nysar.com/nysar-news/latest-news/2017/01/03/smoke-detectors-must-be-hardwired-or-have-10-year-battery-after-april-1

I also have another business and I had to give out several W-9s this year. at first I didn't because I never did it before But my accountant said there making businesses get them now when there dealing with LLCs to help keep track of the taxes. Basically to keep an LLC honest. At least thats how I took it.

There is a property I am interested but there are some issues......

Owner wants to sell but there are problems with the family currently living there.

There are three properties adjacent to each other. One is 1.4 acres with a trailer there is road frontage, but it has a shared driveway and well. The second piece is 2.3 acres with a another trailer and a barn. The remaining is just 80 acres of land. 

The occupants on the 2.3 acres are the owners' parents. They sold the property to the current owner for $1 in 2012. There is no life lease mentioned in the deed, but there is wording in the deed that says 'in lieu of contract.' The property was transferred because the parents didn't want to pay the taxes, and wanted less assets to qualify for Medicaid.  There were problems when the owners siblings moved in with the parents. There was a rental agreement but the parents never paid rent.

The owner hired a lawyer and tried to evict the parents. In turn the parents obtained Legal Aid and filed a lawsuit, saying the property was obtained by fraud. The owners had a sale lined up but it was stopped by an injunction from legal aid blocking the sale until the lawsuit is settled. 

The owners are paying taxes on these properties, and have lost income because they can't sell and aren't receiving rent. 

The owner doesn't want to spend any money on lawyers, because the last eviction was dropped by a lay judge who didn't want to make a decision its a small town. 

Any advice to get the parents out so the property can be sold? 

I'm buying one next week that is rented. I gave the tenants Estoppel agreements and told them if they want to stay I will keep the rent the same til the end of the year.  On January 1st they have to sign a one year lease with a $50 increase. they are currently month to month. and both tenants agreed.

As far as having to remove one (glad I don't have to) I would be professional and polite. Hope it goes easy for you.

depends on your area. for example: NJ you have to have a certificate of occupancy or be able to get one. Upstate NY local banks lend based on appraisal. and in north east PA I had a bank lend on a run down  gut house based on my income. I would call some banks and mortgage brokers. 

I have single family and Duplexes and I have been shopping around and I am surprised and the differences in price and coverage. Just wondering what the BP community thinks as far as coverage and cost? 

policy #1 $3496 for 2 single family and a duplex $1000 deductible $1,000,000 liability 50% replacement 

Policy #2 $5713 for 2 single family and a duplex $1000 deductible $1,000,000 liability 80% replacement and personal       injury and loss of rent.

would love to get some opinions. 

Thanks, Mike

Chris I'm in Jefferson / St Lawrence County.

Brian I have been getting them done in a couple months. I have a small local bank that I have been using for 4 years. I pay everything early and show the units rented. They will lend to my LLC at 80% LTV but I usually take less. And they will only lend on properties in my area. But its working for me.

Nathan and Thomas I agree I'm all about low risk. In this venture I don't plan on taking any income (at least for several years) so I feel I can fall somewhere in the middle. I need to learn more about increasing my ROI with the tax system. I think this is what my friend was talking about. My friend is on a 2 week cruise so I cant ask him more about it right now. I've been taking 15 and 20 year mortgages. rates are 5.1 to 5.6%. not the best but my ROI on these properties have been over 20% and cash flowing at least $200 per unit. I also do all the rehab myself. That's how I make the numbers work for me. I don't think It would work If I had to hire contractors.

Thanks for the reply's. I feel I need to learn more about the benefits to keeping the property leveraged

I'm currently using the BRRRR system in the North Country. I have been refinancing the houses as soon as they are rented.

I have the ability to buy and hold some without refinancing which would give me better cash flow and the ability to pay off my other houses faster. But an investor friend told me to leverage everything and when there paid off refinance them again.  Not sure if this is a good Idea or not. I always worked on being debt free.

 I am new to the rent and hold investing and would like some opinions 

Thanks, Mike

Awsome