All Forum Posts by: Sarah Miller

Been a little while BP!  I actually quit my professional career a couple of weeks ago at a Fortune 500 company to make more time for real estate investing and to take care of the kids :-).  We currently have 4 units and we just put an offer on 6 more units!  The seller was already willing to work with us on a special financing arrangement so it is looking promising that she will accept (fingers crossed).  Obtaining 10 units in our first year of 7-8 months of doing business would be awesome!

My question is, some of the tenants are section 8 tenants.  Some all, some portioned for their rent.  If we do win these units, how do I go about changing ownership of the units to collect the metro housing payments?  Do I need to start any part of the process BEFORE we actually close?  Do I personally need to become an 'authorized provider' or since the units are already authorized does it matter? 

Also, these will technically be the first units that are occupied already at our possession.  What are some tips for meeting/calling the tenants?  I was thinking of sending them a letter initially explaining that ownership is changing but that their leases will not be affected etc, etc and then personally meet each of them briefly.  Good approach?  Thanks!

Marcy* sorry phone autocorrected :-)

Canton the city is very difficult to know the good areas from the bad. I'm with Mary in that I grew up in the area so if you know what you're doing in the area it can be very lucrative.  Although, if you buy wrong you will be dealing with a lot of maintenance. 

Hello BP!  Got some stuff brewin' I'd like some insight on.  Possible 6 unit property I have been entertaining. My main questions involve the fact that many of the current tenants are Section 8 and on leases.  If I were to purchase this property, do I need to do any additional paperwork for the section 8 tenants as their new landlord (ie resubmit paperwork/get approved)?  Also, I am planning on raising rents slightly as leases expire/attrition of tenants.  Is it difficult to raise rent on a section 8 tenant?  What paperwork would be involved?  Thanks!

What is the credit score you need to qualify for a VA loan? Asking for a friend

It sits on a cul-de-sac with a few other multi-plexes.  Not in the best area of town but also not a horrible part of town either.  1 block from a main drag with shops, restaurants, etc.

Price: 58k.  12-15% down payment.  Gross rent for 5 units $22k/year.  Haven't researched it much further yet but the seller is claiming about $6000 operating costs per year.  Of course I would do my own assessment

@Bill Bodziak

 I am currently going through a refinance right now so the door might still be open.  Although my lender mainly wants to only lend short term and probably wouldn't want to hold a buy and hold property for very long.  Still doesn't mean something couldn't be worked out though.

@Account Closed

Down payment requirement the seller is asking for is 12-15% but would consider 10% down.  Gross rent on the property is about $22k/year and would easily cover the note plus cash flow.  I am mainly just a little concerned about having a land contract on top of a land contract.

@Bill Bodziak

 I did think about just buying the property outright, but I don't have enough capital by myself to do that.  That was why I inquired about the land contract in the first place.  The property is not very expensive and I think if I got a partner we could possibly buy it together with what I have...  Although my private lender is already tied up right now in another one of my properties until it is refinanced.

So I am interested in a multifamily 5 unit property.  I contacted the listing agent to ask about land contract financing (as it was advertised in the listing that the seller was open to it) and she said that the current owner has a land contract on the property.  Below is what the agent described:

"Land contract would be drawn up by Jack XXXX attorney who would also do the closing I have everything worked out on it.  Current owner has a land contract and I have had deed-holder also sign listing agreement.  Their current mortgage and the current land contract and the new buyers land contract would all be done proportionately correct for your buyer and I have reviewed the details with Jack XXXX.  The current owner’s land contract was based on 5 or 6 years with natural amortization payoff.  The new buyer’s will be based about 6 or 7 years amortization. and that is with the property paying off with current owner rents."

Can anyone decipher what this means?  Is it a bad idea?  What should I look out for? This property is a 5 unit with potential for over 20% cap rate.  Thanks!