All Forum Posts by: Kyle J.

The place to post deals or solicit partners would be in the Marketplace Forum. 

Since you appear to be from the Dallas Fort-Worth area, you might also try engaging/making some connections in your local real estate forums:

Dallas Real Estate Forum

Fort Worth Real Estate Forum

Lastly, I've personally found that one of the best ways to meet other investors/potential partners is in person at local meetups.  Granted, it's kind of hard right now with COVID, but there are still some virtual/online meetups being held.  And I'm sure things will return to normal at some point and we'll be able to network again in person (hopefully sooner rather than later). 

In the meantime, you can check out the following forum to find online meetups that are being held (you can even attend some virtually that are further away from you because you don't have to physically travel there), and keep an eye out for when the in person ones resume:

Real Estate Events and Happenings

Good luck.

You just posted on it.

@Dylan Fellows  To estimate the rent, you really should check multiple sources and try to get the best comps/data you can.  I've compiled many of the top sources available in this blog article here: How to Determine Fair Market Rent

It also gives you an explanation, and the pros/cons, of each one.  So hopefully that'll be of some help to you.

As for how to estimate repairs, that can be a little tricky as there is no one specific formula.  Many people will just use a % of the purchase price.  However, you have to ask yourself...if you have to replace an HVAC unit, is the HVAC company going to charge you 75% less because you bought the house for $100k instead of $400K?  The point is, repairs are not based on the cost of the house, so why should we budget for them that way? 

Plus, there are so many other factors that can affect how much we spend on repairs.  Things like the age of the house, condition of the components of the house, class/quality of the tenants and how hard they are on the property, how long existing repairs are allowed to go unrepaired (e.g. if a roof leak were to not be repaired in a timely manner it could end up causing additional ceiling, wall, and/or flooring damage that maybe didn't have to happen), etc. 

So it's really all just a guessing game.  I have 70+ year old properties that have cost me nothing in repairs each year, and other properties much newer than that which have cost me thousands in repairs.  Ultimately, it's better to set more aside than you think you'll need, and if you don't end up needing it, great.  But at least you have it ready/available in case you do.

@Sean T. I know you said it’s a hypothetical, but I think your numbers are a bit off and that’s going to skew the accuracy of any analysis or answers. 

For example, are you actually seeing a lender offering a HELOC at 100% LTV at an 8.74% interest rate? It's pretty rare to find a lender willing to do 100% LTV, especially right now. Though I don't doubt there are a few out there somewhere that will. It's just not common. However, 8.74% interest on a HELOC secured by a primary residence is VERY high. If that's really what they're charging, you should shop around.

Anyway, since those are the numbers you gave us, I’ll give you my opinion based off those numbers. 

The way I'd choose is, I'd figure out how much money I actually needed. You say the house you'll be using as collateral is worth $400k, so if I can do what I need to do with $320k-340k (80-85% of the home's value), then I'm going to take the HELOC that has the lower LTV since the money I'll be borrowing will be at a much cheaper interest rate.

On the other hand, if I can't do what I need to do unless I have the full $400k, well then I guess I have no choice but to go for the HELOC with the 100% LTV, even if it means I'll be paying a higher interest rate.

That’s my way of looking at it at least. By the way, welcome to BP. 

@Clark Coffey To answer your question, yes - it is perfectly acceptable to apply the same screening criteria to all applicants equally. And also to deny a couple even if just one of them doesn’t meet your criteria. 

For example, I have as one of my criteria “no prior evictions”. So if I get a couple that applies and one of them passes my screening but I find that the other has a prior eviction, I’m going to deny the couple. (I’ve actually had that happen before.) 

The one area where you generally might want to make an exception is with regard to income. For example, normally when landlords have an income requirement of 3x the monthly rent, they don’t usually need every single person in the house to make 3x the rent. It’s usually acceptable for the couple or applicant “group” to make that amount collectively.

@Charles Scott If he’s asking for vesting info for your buyer, usually that’s asking how your buyer wants to take title to the property. Not sure why he needs that though if he’s another wholesaler and (it sounds like) you don’t even have an accepted contract yet. Usually the title company is the one that asks for that info. 

There is no way to prevent the end buyer from figuring out the seller's name.  Anyone who wants the name could probably figure it out in about a minute or two with nothing more than the address.  (I know I could.)  

And no, you cannot keep the purchase contract from the end buyer either if you are trying to assign it to them. They get to see it, hold it, read it, etc.  You are assigning it to them, so if they agree to it, they are agreeing to be bound by all the terms/conditions in it.  Wholesalers - please don't expect them to do that without them having READ it in its ENTIRETY first. 

You need to deal with people who have integrity and establish trust with them.  In the end, trust and integrity are the ONLY things keeping people from making an end run around you and going directly to the sellers.  

@Rebekah Nation  You did give him two options (Pay or Vacate).  Sounds like he chose the latter.

@Derek Gold  You should know that your statement about "The property is not uninhabitable they just don't have hot water for now" is not legally how it works with regard to rental properties. 

Almost every state (except one I think) has what is called the "Implied warranty of habitability".  That means that a home must be kept in a certain condition for it to be considered legally habitable.  Those conditions vary by state, but every one I've ever read (including my state's and yours) specifically list "hot water" as one of the requirements.  If you don't have those things, the home is not legally habitable and you cannot charge the tenant rent for the period of time that it is not habitable. 

You can read more about the "Implied warranty of habitability" requirements for your state here if you're interested (scroll about half way down the page):

Texas Rental Laws – An Overview for Landlords and Tenants

As for the plant, I agree with the others, it was an extraordinary event that I personally wouldn't try to hold the tenant responsible for.  It wasn't like they intentionally failed to water the lawn for a couple months and the lawn died as a result.  This was Mother Nature that brought unusually low temperatures and killed a plant that wasn't well-suited for such a low temperature.  Honestly, I don't think you even could hold them responsible if you were to try and they were to challenge it in court.  But personally, I wouldn't even try.  Sometimes things just happen.

Just my two cents.

@Frank Agyeman-Duah  Selecting tenants is SO much easier if you have an established screening criteria that you can base your decisions off of.  Your criteria should be written down and provided to the applicants so they know what it is too.  That way, (hopefully) they'll self-screen themselves and only the ones who qualify will actually bother applying.  

I'm guessing you haven't done that yet, but I highly recommend you do it for future vacancies.  Whether or not you choose to have a minimum credit score as one of your criteria, you should definitely have a minimum income requirement.  The most common is 3x the monthly rent.  I don't think I've seen anyone set their criteria less than 2.5x the monthly rent.  Either way, this applicant doesn't meet the 2.5x or 3x income criteria.  Her income just simply isn't enough to rent your place (regardless of her credit, which isn't great either).

So I agree with @Julie Hartman, I'd pass on this applicant.