All Forum Posts by: Peter Kandra

Hey Nick. I'm Pete. I live in Jackson too. I can hear Medusa from my house and the concerts when they have them too. I've been investing in Trenton for just about 3 yars now. Cheap properties, good rents and only 15 minutes away. I can send you contact info if you need a good realtor who handles that area.

Yes. The NOL gets carried forward until you either have enough rental income to offset it, or you get rid of the property. If you get rid of the property and still have a NOL, you're allowed to completely deduct the loss, even from non-passive W2 income (subject to certain limitations, like not having other rentals, if you elected to group them together, etc.)

If you have to evict, it's probable you won't collect a dime. As far as damages, I'd suggest filling a small claims in court. As far as collecting on the balance of the lease, you may get a judgement in your favor for lost rent until you re-rent the place....provided you actively try to re-rent it by advertising, etc. I'm only had to do 2 evictions to date. I filed small claims cases against both of the tenants. One settled with me prior to the court date (she had just bought a house and didn't want a judgement clouding the title), and the other was a no show at court. My collecting the 3K judgement is another thing entirely...
Good luck.

Aly,

Feel free to send me whatever questions you have either via the forum or PM.

Pete

Hi Aly.

It's funny. Every year my business partner and I talk about trying to get a quality property for seasonal rental in the shore area, but the prices really are ridiculous. I guess it gets a little more reasonable a few blocks from the beach. I also have a neighbor who owns a few rentals in Freehold, and he paid quite a bit for them. I've been at this about 3 years now, but talked about it for almost 3 years before actually doing something. Once you get started, buying properties can be addicting. I decided to focus on the better areas of Trenton because of reasonable prices and good rents. We've recently started putting in section 8 tenants as vacancies come up. It's a little more effort and paperwork upfront, but worth it. I also don't use a property management company since I'm from Jackson and only 15 minutes away from Trenton. Something I've found extremely valuable is to build a strong network of professionals. I have a fabulous realtor, who mainly focuses on the area I invest in, and also knows pretty much every large landlord in town. An experienced lawyer is a must too. An accountant is also worth their weight in gold. Depending upon how you have everything setup, yoiu can end up paying too much tax, or setting yourself up for future tax problems. Luckily my wife's an accountant, so I get a free pass there. Get familiar with NJ's landlord / tenant laws too if you already aren't. Most people seem to learn them when it's too late and they get involved in a legal issue. Feel free to let me know if you have any specific questions.

Good luck !
Pete

Hi everyone. My name's Peter Kandra. I've been monitoring the forums here for a few weeks now and find a world of info available. I've been purchasing SFR in the Trenton, NJ area for almost 3 years now. I currently have 11 so far. 8 are with a neighbor / partner and the others are just my wife and I. With the state of the mortgage market the way it is, I seem to have hit a plateau, and am unable to find financing for additional properties. All of my acquisitions to date have been with 90% LTV full-doc financing. As recently as several months ago, there were plenty of lenders who would cap an investor at 20 loans, now there's only a handful that will cut you off at 10. What's a investor in my position to do ? There's no shortage of good deals in my area...I can buy 5 houses tomorrow if I could get financing. Thanks for any advice you can offer.
Pete

I'm from Central NJ and currently invest in the Trenton area.

Mitchell, I'm always looking for good sources of financing. With the current state of the lending industry, I'm finding it virtually impossible to get funding. I currently own 11 mortgaged rental properties, and almost all lenders cap out before then.

Rich,

Section 8 has it's benefits and drawbacks. 4 of my properties currently have section-8 tenants in them. The rent is equal to or even slightly above market value in some cases, but that's based on the HUD FMR (fair market rent) jurisdicstion you're in. Your unit will have a housing quality standards inspection done, called an HQS. Once you pass that and you approve the tenant according to your screening standards, you will fill out a HAP contract with the local agency administering the section 8 program in your area. After that, the monthly checks come like clock work. Depending upon your tenants income, section 8 will pay most or all of their rent. I'm not sure about your area, but where I am in New Jersey, it's illegal to decline tenants just because they hold section 8 vouchers.
You'd have to decline them for credit, etc.
gosection8.com has some good info as well as HUDs web site.
Hope this helps.

Peter

Thanks Joe.
When I think about it like that and view it as a whole, it makes complete sense. I just have a mental block with the partner account being negative. I should probably just butt out and let my wife do the accounting and stick to the landlording end of the business !

This is mostly a theoretical question for now, but will most likely become valid in 5 years or so. I own several properties with a neighbor of mine that we operate under an LLC. We file a partnership form 1065, and we each get a schedule K-1. 2007 was our 2nd year operating. Our balance sheet on the form 1065 is currently what would be expected. The properties minus accumulated depreciation equals our loan balance plus partner capital. My question is what happens in several years when the accumulated depreciation is much larger than the mortgage principal reduction and exceeds our partner capital account ? It's my understanding that partner capital accounts may not be negative. My wife is an accountant, but I like to have a full understanding of the numbers side of the business just for my own warm and fuzzy feeling.