All Forum Posts by: Nazz Wang

No matter what you do, don't forget you are running a business and you need to treat your choices as a business owner, not an emotional homeowner. I would recommend minimizing the appliances you provide, and stick to the absolutely necessary ones, and provide quality appliances in the ones you provide. More landlord provided appliances means more repairs and overhead, but will not give you a cent more rent. I would advice against washer/dryer/fridge, and would only provide a very nice stove. Higher end rent also attracts a large number of tenants that already have their own fridge and washer dryer anyways. Honestly, those three are the ones that need the most repair. I also spell out what appliances are maintained by landlord. If the law allows, I state the appliances are there for tenant use for free but the tenants are responsible for maintaining and repairing them if they break. Remember, run it like a business.

Honestly, judging by the price and market rent, this class of rentals will look a lot better on paper than in actuality. Have you seen the units and the tenants? I honestly don't think there are much profit after the repeatedly broken front gate every couple of days and the back rent. I believe you get what you pay for.

I would ask for a copy of the appraisal (you the consumer is entirely entitled to do so) and talk to a few more refutable lenders. Definitely seems shady! I would tell them to provide the appraisal ASAP and I will be shopping around. LTV for rental refi's in my experience has been 75% for consumer loans and at the worst 65% for commercial loans or blanket loans. The best I was able to get was 80% 5 year term from a small local bank.

I personally don't like college rentals with all the reasons above plus some. Usually they don't really cash flow and students tend to have high wear and be more transient. Do expect yearly turn overs most of the time. And any seasoned landlord know that turnovers are the most costly thing in the rental business.

I am confused about what your question is. Are you asking what is the best way to get your hands on 100k cash from your equity? Yes you can do a refi cash out. I wouldn't put everything in a blanket as your loan balances are higher per property and that would limit your future selling and refinances, aka you can't touch one property without affecting the others under the same blanket. Also I have not seen any lender who would do a blanket loan for properties not in the same market location. Maybe they are out there but the rates are higher, loan is shorter term, etc. I would stick with the traditional Fannie Freddie loans. Cash out refi is the same as regular new purchase loans minus dealing with agents and seller. Pretty much the same except usual LTV is no more than 75% and the loan process might take shorter. I would definitely do some research and talk to a few national lenders to compare closing costs. My last was with the national bank of Kansas City.

Can you elaborate a little on what kind of purchase, cash / financed / wholesale / etc, and what state, etc?

MLS number is what the MLS system use to identify each property. MLS = multiple listing service.

Talking to a local realtor / loan officer might give you a lot of information about closing costs too.

Pretty standard in my operating area. Every once in a while I will find a 25 year amortization but it will be a 2 or 3 year fixed.

@Dawn Anastasi

Congrats Dawn! Can't wait to see the finished product. This would be fun!

Insurance seems a little high, you might want to shop around.

Did you budget tenant placements fees into management fees? Or do they just charge you the 10%?

5.3k vacancy and maintenance is a bit low, I would budget at least 1000 per unit and 1000 for common area repair and maintenance, and a 8-10% vacancy rate.

How about landscaping, snow removal? If you hire someone you might want to budget in 80 bucks a month. The common area should probably be cleaned at least every 2 weeks, probably 25-40 bucks. If you have a tenant do it they would probably want a reduction in rent, which will need to be budgeted.

What does your lease say about early termination? Stick to that.

Beware because you might not have enough security deposit to cover lost rent and cleaning. So the best thing would be to try to get them out of the property as soon as you are able, clean it and re rent it. They are technically liable for the entire rent about until lease term, so technically they will have to pay you. But more often than not, it is cheaper and easier for landlords to just cut their losses and move on to find a good tenant who pays. People staying at a place they don't want to stay are more likely to kick doors, slam fridges, drag a chair across the beautiful hardwood floor, you get the idea.

Plus, these people are messy if you can smell their pet in the house. I'd say get them out and find new good people without pets.