All Forum Posts by: Nick James

Thanks for the input everyone. @Bob Metry I was talking to my friend today about doing that. We probably could do that and like @Patrick Sugg mentioned, we were thinking of doing a quitclaim as well. We just reached out to one lender we were thinking of working with to see if there is a due on transfer clause. If not, we might go that route.

Hey BP. As the title suggest, I'm looking to purchase a vacation home in a partnership LLC. My friend and I reached out to a lawyer that suggested it is doable, however, so far we have only found lenders that require us to purchase the property in one of our names. We would rather purchase it in an entity of some sort since we would be splitting everything.

Does anyone know of a lender that will lend to Partnership LLC for a vacation home? We are currently targeting the Smoky Mountains. We would also love to know how other people are purchasing vacation homes in a partnership. Thanks!

An update to this post is long over due. I got so bogged down by contacting lawyers, going back and forth with the Housing Authority, and trying to figure it all out, I forgot to come back and let you all know. Sorry BP!

But luckily this story does have a happy ending. The housing authority did recognize it was them that made the mistake and they did end up granting her the "Reasonable Accommodation". She needs a good amount of assistance because of her disabilities. They also gave me the $2,900 per month in rent I was asking for. It took about 3 months to reach a conclusion, but once they did, they back paid me to her move in date! You can only imagine the relief I felt once I got that letter and check.

Since I am posting this 3 and a half years later, I figure I can provide an update on how things are currently going. The tenant still lives in the property and is honestly one of the best tenants you could ever hope for. She pays her portion of the rent on time, keeps the place more tidy than I ever did, and has even come out of her own pocket to cover minor issues that were not even her fault.

Taking a chance and fighting with the Housing Authority turned out to be the best decision I've made. It was very stressful in the moment but I am so grateful it worked out. I will just have to count my self lucky.

Thanks again for all the feedback!

Personally, I'd consider states with little or no income taxes. Washington and Nevada are on my short list. I'm thinking Vancouver Washington or Las Vegas Nevada.

However, you are already based on Washington lol. 

Curious to see what others think.

Thanks for the heads up! I just RSVPd

@Liz F., I was worried about setting some kind of precedent as well. I am going over there today to let her know she is responsible for the time she has been there since section 8 will not pay it.

@Daniel Antonetti, You make a great point about seeing if they can rush the request for accommodation since it was their fault. I am trying to speak with a lawyer just in case I do have to evict her.

@Matt B., I'm not considering accepting the lower amount. I was just laying out the options Section 8 gave me. If I do find another tenant, I think I'll keep my $700 :)

@Patti Robertson, You are soooo right that this is a partially a mistake on my part. I should have double checked with Section 8 before she moved in. I could have confirmed with them that there were only 2 people moving in and asked them to verify that they are ok giving her a 3 bedroom voucher and asked why. I didn't know it was possible to do a mutual lease termination. I reached out to some lawyers, still waiting to hear back. I will definitely mention that to them.

@Colleen F., I'd like to think its not fraud. She does walk around with a leg brace, a cane, and has a wheel chair. She claims all three of her doctors signed the forms needed and she submitted the request for the accommodation. I will go to the property today and see the forms and see a receipt saying she actually submitted the forms.

Thank you everyone for all the feedback. I decided to go over to the property and see the forms she submitted and see a receipt. I will let her know I am denying the 2 bedroom voucher and she should start looking for a place. If by some chance the accommodation request gets approved in the next couple weeks, I will resubmit for her to stay since she would have a 3 bedroom voucher.

Hey BP,

I recently renovated a 3 bedroom unit in my East Oakland Duplex and put it up for rent. I decided to accept section 8 applications and ended up selecting a single mom who lives with her 12 year old daughter. She was already living in a 3 bedroom home with a 3 bedroom section 8 voucher at the time she applied to live in my unit. We signed all the necessary forms provided by section 8, went through the inspection and my new renter was given a new 3 bedroom voucher and the agreed upon rent was $2900 a month. I still have the paper that was given to me from the HUD inspector. From there we signed a lease agreement and my tenant moved in on July 25th, 2017.

Today I received a call from section 8 saying they cannot give my tenant a 3 bedroom voucher. They screwed up and should have never given her a 3 bedroom voucher. She used to have 3 kids living with her but now she only has the one so they want to offer her a 2 bedroom voucher that maxes out around $2200 a month. It's a $700 a month difference and rents cant be increased for 12 months. I can accept the new offer and eat the loss, or I can deny it and my tenant would technically need to start looking for another place. However, I do have a third option.

My new renter is partially disabled and submitted an application for "Reasonable Accommodation" to section 8. Reasonable accommodation means section 8 can break certain rules if a need is there. If for example my tenant needs a live in aid, or has a bunch of medical equipment that needs to be placed somewhere, they may approve the request to have a third bedroom. Problem is I would have to deny the offer for the 2 bedroom pay, wait for the decision on the reasonable accommodation, and then resubmit the forms in order to get $2900. If I go this route, I will not receive any money from section 8 until the new application is turned in and it can take 1-6 months for the reasonable accommodation to be approved. Thats a long time for my tenant to be living there basically rent free. There is also the possibility that the request for the third bedroom is denied. I would have waited all that time for nothing and lost a lot of money. This is my first time dealing with section 8 and I really just want them to honor the original agreement. I hate the thought of evicting the lady since I really like her, she just moved in less than a month ago, and she is disabled. Plus it isn't even her fault. Any advice would be greatly appreciated. Thanks.

Hey @Jeff Wilkerson,

Welcome to BP and that is pretty awesome of your uncle to do! Based on your post, it sounds like you are looking for a value add property. Something you can buy cheaper than market, rehab it, and refinance. It's called the BRRRR strategy. I am kind of in the same boat as you in terms of trying to best figure to do this in the Bay Area but here is what I know so far. First off appreciation is never guaranteed, even here in the Bay. We are in a hot market now but things could turn and the more years you wait to refinance, the higher chance this hot market could start to cool off. So you will want to try and pull your money out as soon as possible. That being said, I suggest you figure out which areas of the bay you want to invest in.

Look for areas that are seeing some growth. I like to see what new businesses are coming to the neighborhood, population increase, rent increases over time. If you want to get data on a particular city, you can use https://fred.stlouisfed.org/, http://www.city-data.com/, or reach out to investors here on BP.

There are some great articles here on BP for understanding the basics of deal analysis like https://www.biggerpockets.com/renewsblog/2010/06/3.... You mentioned you need to show your uncle a model, BP has some great calculators for that like https://www.biggerpockets.com/buy-and-hold-calcula.... Go play with it and you will see it gives you a break down of COC and debt pay down. I'm sure others will have more to say. Good luck and hope that helps!

@DG A., you are welcome. I too was curious what all the construction was about.

@Atish Shah, no problem at all. I'm always excited to share what I know!

@Arlen Chou, I am not unfortunately :( I own a duplex about half a mile away from it and saw the progress they were making. I am trying to buy triplex or fourplex in Oakland so I reached out to see what they planned on doing with the building. I agree, it does look great and it will be right next to the new East Oakland retail center http://www.eastbaytimes.com/2017/02/02/east-oakland-retail-center-finally-breaks-ground/. Congrats on getting a 6 unit building in the Fruitvale area that cashflows! I would love to be able to pick up a multifamily in that area.