All Forum Posts by: Hamp Gaston

I am considering a duplex; here are the details:
good area, asking price is 96k, one half is a 2/1 rented @ 550, the other half is a 1/1 rented @ 500. Older home in good shape.
To me, its a possible deal @ 70k (assuming 7% apr) and looking for $50/month cash flow--what do you think?

Robbie, check your inbox.

Todd, I also have a section 8 tenant and so far I have not had any issues. As stated previously, screen them as you would any other tenant; I also put a provision in my lease agreement that I would perform monthly inspections on the property just to ensure that everything is being cared for and nothing major is being neglected. It is nice to receive a rent check like clockwork on the first of every month. Just make sure if you do accept a section 8 tenant that they can cover their portion of the rent (if they have to pay.)

Taz,

I do have reserves and could cover something significant like a new roof/HVAC if needed. This was a fairly comprehensive rehab, so I dont *anticipate* anything significant other than tenant turnover or goodness forbid another eviction. I have a HUD tenant (good person to boot) in there now, have not had any issues. I am limited by them as to what rent increase I can do. I guess its just the sting of being in it for too much. Live an learn

Definitely an expensive lesson...I just look at it from the standpoint of IF I couldn't sell it right now what my options are; I understand they are limited, I guess I am trying to put lipstick on a pig ; )

For the group:

I purchased a property a year ago with th help of a third party who sells fixer uppers, provides rehab, helps find tenant to lease purchase house. That was my first mistake. The tenant they put in (whom I did not screen), I had to evict after 2 mos. That was my second mistake. I really wanted in real estate but trusted the WRONG people. So, failure is not an option, therefore let me throw out these numbers and I want to get everyone's advice what to do.

I do have extra cash I could use to pay down the balance to get to a more favorable cash flow/or at least help to increase the amount of principle paid each month. Here are the numbers:

appraised value: 92k
67,500 @ 7% 30yr
PITI: 562/mo
Currently leased @ 700/mo (will be increasing rent 25 after lease is up for the year)

I know using the 50% rule this shows ~100+ loss each month, thus the reason for this post to see what can be done to "fix" my mistake. Would you:

1. put more money towards paying off mortgage
2. move on to the next house with better numbers/cash flow, take my medicine and learn from this.
3. Pay off entire mortgage as quickly as possible 4. Something else

Let me know if more info is needed.