All Forum Posts by: Kyle J.

@Kevin Panella The statewide law that controls this is AB1482. (You don’t say where you’re located, so no way to know if you live in a rent controlled city that has something more restrictive.)

Basically, unless your property falls under one of the few exemptions to the rent cap law (AB1482), you can raise the rent 5% plus the applicable Consumer Price Index (CPI) or 10%, whichever is lower. (Hint: 10% will not be the lower of the two.)

The CPI varies by county, and changes every year. But you can do some Google searching and figure out what it is for whatever county you’re in at whatever time of the year you plan to increase the rent.

Lastly, here’s some more reading on AB1482 if you’re interested: 

https://cal-rha.org/advocacy/ab-1482/

You sound like a well-qualified borrower, but unfortunately you don't have enough equity in that property to borrow $60-$80k from it. That'd put you at least over 90% LTV, and up to roughly 100% LTV.

Not going to get that with a cash-out refi or a HELOC on a rental property.

@Dylan Gelbard I have no issue with wholesalers.  I have been the end buyer in wholesale deals, and the private lender to the end buyer.  So I'm very familiar with the process.  It may be as simple as you described, but it's not as easy as that.  If it were, everyone would be doing it (not just trying to do it).

In my experience, most wholesalers struggle in one of three areas:

#1 - Trying to find deals

#2 - Trying to find end buyers

#3 - Trying to find one or both of the above consistently

Now, you've managed to do #1 and #2, which is actually a LOT farther than most people trying to be wholesalers get.  So congrats for that.  Seriously.

However, before you celebrate too hard, re-read the last sentence of your post...you just did one.  Most people who are trying to become wholesalers are trying to make a job out of it and want/need consistent income so they can supplement (or even replace) their W2 income.  One deal is a good start, but it's nowhere near enough to do that.  It's a bit like saying "I don't understand why playing in the Major Leagues is so hard. I just hit a baseball."

By no means am I trying to diminish your success with this one deal, because - like I said - you've done a lot more than most who try to get started.  But now it's time to focus on #3 on my list above. 

Best of luck to you.

Those who are wondering about hard/private money lending really need to read, and then re-read @Jeff S. post above. That’s some seriously well-thought out advice from an experienced lender who’s not trying to sell you anything. 

I do private lending myself and often jump on these posts to offer similar warnings to help try and keep people out of trouble and from losing money to scammers. (Trust me, there’s plenty out there.) However, in this rare case, I have nothing else to add. 

If you read his post, and the referenced links, you’ll be far ahead of most. 

@Jasmine H.  I'd tell them, while you understand their concerns, at the same time you don't feel comfortable turning over an asset of yours that's likely worth hundreds of thousands of dollars without them being willing to provide their SSN.  

They likely provide it to the cell phone companies in exchange for an asset worth less than a thousand dollars.  They likely provide it to credit card companies in exchange for a piece of plastic.  And in both of those instances, they actually have NO idea who is really looking at their SSN (or how many people).  At least with you, they know exactly who you are and where to find you.

Ultimately though, if they're not willing to budge and you're not willing to budge, you win.  It's your house, and you shouldn't compromise on your own rules/requirements.  

Usually this sort of thing is (or should be) addressed in your lease. For example, my lease states “Tenant shall be charged for repair of drain blockages or stoppages, unless caused by defective plumbing parts or tree roots invading sewer lines.”

So, having not read your lease, we couldn’t say for certain who is responsible for the cost. However, the answer to your question may be found in the verbiage of your lease. 

@Leon F.  If it's as you say, I would personally not be worried about anything.  There are no "refunds" when it comes to home purchases.  It's not like he bought a t-shirt and it doesn't fit.  You've already closed.  It's his house now.  Personally, I would just ignore him (and his secretary).

Perhaps someone from Texas will chime in (@Greg H. is the local expert), but I know where I'm at the tenant hasn't even returned possession of the property yet until they've given me the keys.  Especially if they've previously changed the locks and I can't even get inside without them.  

So you might remind them that rent is still being charged as long as they keep possession (the keys), and until you get inside and do a walk-through/inspection and verify the condition of the property.  

Also, I never provide security deposit refunds on the spot.  They always get mailed after the fact within the legal timeframe allowed.  (21 days after tenant returns possession of the property for my state, and I think 30 days for your state.)  However, I seem to recall from reading @Greg H.'s previous posts, that the 30 day clock in your state doesn't even START unless/until the tenant provides you a forwarding address.  Just something to be aware of.

Hopefully someone from Texas will jump in with more specific info/suggestions.

Good luck and hope it works out for you.

I don't allow pets so I don't charge a pet rent and have never tried inputting that on Zillow.  However, even Zillow's own site doesn't mention any restrictions on that (see here) and there's no law against it.  There's also other rentals listed on Zillow in the City of Sacramento area with pet rents greater than $30 (I just scanned the listings and pulled up multiple requiring $50 pet rent).

If nothing else, list it in the description.  You can write whatever you want there.

It's going to be REALLY hard to find a lender willing to do a mortgage on a home priced that low.  There's just no money in it for them.  You don't mention where you're located, but that might make a difference.  (I know there's no lenders around my area that would do a mortgage on a home at that price point.)  

You might try posting where you're located to see if anyone has any suggestions for local credit unions or portfolio lenders that can do it. If not, perhaps a HELOC could POSSIBLY be an option.

There's not a lot of lenders willing to do HELOCs on investment properties, but there are some (I have a couple myself, so I know they're out there).  And there's no Fannie/Freddie rules for those.  Each lender can (and does) make up their own rules for those, and you might find one willing to do one on lower price-point homes.  They usually have lower (and sometimes no) fees too.

If you decide to look into a HELOC, here's some questions to ask when calling around: What You Need to Know When Shopping for a HELOC

Good luck.