All Forum Posts by: Mogi P.

If you are adamant about getting a rental property, there is a way around your situation. I would talk to small mortgage companies that do in-house underwriting. They tend to be more lenient than the big banks. When I say "lenient", I don't mean they will give out free money. You must still prove your case. This could mean having some sort of lease agreement with your tenants, records of rent payments, or whatever it may be. Good luck.

Update - I went with app #2. They actually have not bothered me much even though they have a direct line of communication with me through google chat. Even better, they set up an electronic monthly recurring transfer for rent payment. I feel blessed!

Roy - I actually had a criteria. Both applicants came in the same day and both met that criteria. Being my first rental, I guess I didn't narrow it down enough and I didn't really know what type of applicants to expect. Otherwise, I would have already known which one to pick. I believe you learn to make those decisions through experience. I don't think #2 is the smart way to go. What if none of them meet your criteria.

Thanks for the replies. Well, I fired back at App #2. I offered to provide the fridge, washer, and dryer; but raise the rent. I just basically said no to some of the ridiculous requests (mm gap in cabinets). They accepted!

Hi everyone. I haven't posted in a while. I've been busy getting a rental in order. I now have a dilemma between two applicant tenants. I am leaning towards one but wanted some of your opinions. The SFH is a 3/2/2 listed for 1295. Comps at 1350. Only other active comp is being listed for 1550.

App #1: single mom with four young teenagers. Will be using section 8 voucher. Income (to be verified) is already 3x rent. Did not have complaints about the house, but section8 still has to do inspections. Some credit issues.

App #2: two grad students working research positions. Good credit. Nitpicked during showing (e.g. how some cabinets doors had a mm gap in closed position). Signs of endless service calls in the future? Constantly wanted to negotiate price down. Requested fridge, washer, dryer at my expense (lower rent if they bought and I keep or I buy at current rent rate). Asked my realtor if they could back out of app if they needed to.

Both are wanting to move in 2 weeks.

Your opinions are appreciated.

Update: Seller had a change of heart#&@(# after accepting the offer...the asset manager spoke to my realtor and told him the purchase price was too low. I'm not sure who they think will buy this property at a higher price. It pretty much requires a lot of work to bring up to livable conditions. When we looked at it closer, we found out it needed some foundation work (piers). Oh well, there should be better deals out there anyway, right?

Rudy, I don't have a PM option with you.

Hi Mitch, can you elaborate more? What do you think is a good margin?

Thanks for the input. I am going to go through with it. I might write a blog about the progress and share my experience.

You're absolutely right about this being too expensive for a flip. I went through those numbers too. My net at 80k sale would be a whopping 3k.

I don't follow what you are saying about the rental ROI though. Is that monthly rent divided by total investment?

Just got word from my realtor that offer was accepted for this Fannie Mae property. Not under contract yet. I have 2 days to supply EM.

3/2/2 1580 sqft built in 1968
list: 54.9k
accepted offer: 39.5k + seller 1k closing costs (homepath financing)
repairs est: 25k (new roof, kitchen, and one new bathroom. I think I can salvage the master)
ARV: 80k (conservative, recent comps showed 85k but had large DOM number)
Rent comp: 900-1000 (depends on the rehab)

TI: ~300
PI: 240
cash flow: 210 based on 900 rent
annual ROI: 8.5%

What do you guys think? I say not bad, but not great. My realtor who also invests offered to be end cash buyer for double closing if I decided I did not want to pursue this. He knows all the numbers going into this deal. Is it possible to wholesale this to him? How would I approach it?

Feel free to correct my numbers or the deal itself if you find any errors.