All Forum Posts by: Mike Moe

@Macayla Fryc It is specific to our use unfortunately. On that note, contracts are typically catered to specifics, so there is risk with getting one from others and using it. That being said, if you are going to involve a lawyer to help you, always take a first crack at the language and just have them edit/check for things as they see fit. That will save a ton in their fees and still give you a solid lawyer approved contract. 

Here are a few other things outside of what i listed previously (scope of work, payment schedule, deadlines, and what is due on completion) .

Work hours & conditions- aka if they are doing work on a occupied property, I don't want them there at 5AM or 10PM. In addition, they are not allowed to knock on doors or attempt contact the tenant unless requested through the owner or property manager. You'd be surprised at how many contractors knock on doors and ask your tenants to use their bathrooms...not ok!

Scope of work changes- what needs to happen if the scope of work changes from what was originally agreed upon. Also, if they go past their deadline, there should be a cost to that. Depending on the size of the job $50 a day isn't unreasonable. We usually write that in AFTER we give them a buffer. AKA if they say they can have it done in 3 weeks, we give them 4 and then charge the fee. Its just being human, things happen, parts are delayed, BUT having some incentive in there will  make sure that they aren't stringing your job along because they just aren't on top of it or they had a different job popup they want their people on.

Workmanship and warranty- just stating that all work will be completed to code and what type of warranty is expected.

Clean up- this is included in the scope of work, but is often missed or is a surprise bill after the  fact. Always make sure you are clear as to what the clean up/haul away plan is and who is responsible.

As far as what jobs I use this on, as a lot of things, it kind of depends on your risk tolerance.  Definitely anything north of $10k in my opinion warrants something like this. Just be reasonable- if you ask a handyman to sign an extensive contract for a $500 service call, you might never find someone willing to do the job!

Hope that helps, happy to chat more if you have questions! 

Hey All! As the winter is fast approaching here in Minnesota (MN), I'm curious to hear what your "must do" winter prep lists contains to make sure your rentals are good shape for the cold? 

A few of mine include:

• Draining outside hoses, and bowling out any irrigation
• Testing sump pump and removing/draining any hose extensions
• Cleaning out gutters to avoid ice dams
• Thermostat upgrade to a smart thermostat to conserve energy
• Furnace cleaning & check up
• Friendly reminder to tenants on snow removal responsibility :) 

What's on your list?

@Aaron Rouser- Congrats on the first purchase! Hopefully it is one of many for you guys! If you haven't done so already, I'd have your team start working on initial numbers for your refi. Have your agent start pulling comps for the ARV, and your lender to start to give you estimates on what you can expect for the refi (LTV, closing costs, rates etc).

In response to some of your questions:

I didn't use any tools for rehabs, but used the advice of people far more knowledgeable than myself in this area! I also always received multiple bids for larger projects. Once you get a handful of estimates on your jobs, you'll start to get a feel for what those will cost (per sqft or pre unit etc). On top of this, I always structure contracts on larger jobs to protect me. A lot of new investors won't even write up a contract, and will just use whatever the contractor or handy man gives them. These are always very skewed in favor of the person doing the work. I always write my own contract or make sure I can modify their existing contract to include things like: when the job should start, how long it will take, what penalty there is for the contract if they go past the deadline, what approvals need to happen if the job is going over budget, how much I need to put down to begin (i don't like doing more than 30%) and what the payment schedule is after that (some larger jobs will have milestones where another 30% is payed when completed), and what will be delivered to me before final payment (final approval, lien wavier etc..)

As mentioned by the other people here, lots of snake oil being sold out there now days! You have a handful of "operators" who have done one or two deals trying to sell a mentorship program for 10k+. When you look at choosing one of these programs, you want to get a feel for what type of value and return you'll be getting our of it. I joined the Jake and Gino Wheelbarrow Profits community over two years ago. At the time I was a bit skeptical, but took the dive anyways. I'd recommend it 100 times over to  anyone looking to get into real estate investing and scale quickly. It was so much better learning 1 on 1 with people with 1000s of units under their belt than trying to piecemeal parts of my education together off forums and other material. I learned more in the first 6 months working with my coach than i did in the first 3 years of trying to do it on my own. If you want to get an idea of what the community is like, they have their annual event coming up in October- Multifamily Mastery 4. Check it out and see if it is for you! 

Tucson has been a great market for the last few years with small multi, and has all positive indicators it is going to continue to outpace the nation. Feel free to reach to chat more!

What @Daniel Anshus said...John is your guy!

@Pedro Ramirez hey Pedro. I’m not local in Tucson, but own property there and am in the market pretty frequently. Always down to jump on a call and chat real estate - let me know if I can help with anything while you are getting started!

Tucson is a great market to be in! I've been looking there for a while, lots of good things going on there. We've got a 24 unit and another 8 unit under contract. Let me know if I can help in anyway as you learn the market!

@Nick Miller if you download the MeetUp app there are a handful of good ones that have events regularly! Let me know if you can’t find them.

As already mentioned, you'd want to speak with a lender who is familiar with what you are trying to do. @Tim Swierczek is a lender who is well versed with investor strategies like this one! 

On your note around if you should each buy individually, I always recommend this. If you both sign for the loan, it hits both your debt to income ratios for future purchases for the full amount. If you can qualify on your own, there isn't a need to add that to the other's DTI. My wife puts all of our personal stuff just in her name (house, cars, any other major purchases) so my DTI is free for investment purchases!