All Forum Posts by: Steve K.

@Mary Joe   To use the mention thingy, hold down "Shift" on the keyboard, then press the "@" key, and then "?" key.  You'll see a drop down list and click on the person's name.

Back to your original question, I don't think it is landlord's responsibility to check someone's visa and see if the person's staying here legally.  That is the job of a custom's officer, border patrol, or the police.  Some would argue that  checking  a foreign national's stay validity is interpreting the law and requires a lawyer's license, or has to be empowered by the government to do so as part of the official duty.

Hedge funds will be chasing the next best thing from summer 2015 forward if the Feds really start to increase the interest rates.  If the Feds stay the course and increase the rates in small increments like they've talk about for the past year, Hedge Funds will chase after fixed income.  Fixed income such as government debt has lower risk and higher liquidity, plus lower maintenance cost to boot.  Hedge Funds can also invest in real estate indirectly through REITs, which is a lot more liquid than true real estate.

So really keep an eye out for the Federal Reserve.  Fed's actions will tell you whether the Hedge funds will exit the retail rental market.  

The low interest rates caused Hedge Funds to chase after anything that will provide more yield which includes real estate and stocks.  When bonds are attractive again, HF will dump real estate in a heartbeat.

There isn't enough information here to make an informed decision.  

What condition is the property, class A, B, C? SFR, condo, etc.? General location or the community? Is the seller trying to sell the property with assumable loan? How much does the seller want? HOA? Rental restrictions? Existing tenants?

Another point that's not clear. "Seller wants $60k down." Is the seller going to be carrying the mortgage? Lenders are the ones who require amount of down payment. If it's cash sale only, then "seller wants $60k down" is a mute point. If seller financing, you'll want to check current mortgage contract for due on sale clause. If it's a REO (owned by a lender), then there wouldn't be an existing mortgage. Junior position liens are usually wiped out in REO unless there is subordination going on behind the scenes.

In a buy and hold rental deal, the numbers have to cash flow positive for investors to get excited. If it's an appreciation play, then the exit strategy has to make sense factoring ins 10% real estate transaction cost plus profit. Meaning 6% buyer/seller agent commission plus 4% misc tax, transaction cost. Plus the rent has to breakeven with PITI factoring in vacancy rate.

My gut feeling is that the information is conflicting and I would not invest if this is all the info that's available.  :-)

@Doug McLeod  Here is an idea. If you have positive cash flow properties, setup LLCs for those properties. Have your wife be a managing member for the LLC. Her job will be managing the rental properties.

The LLC can pay wife for property management. Accountants can generate W-2 for her pay. Lenders will look at two years of W-2 income to qualify her on the conventional loans. If the property is in her name, she can get cash out refinance loans after two years of W-2.

Just my 2 cents.

@Lawrence Cox III   Old school thinking is to avoid debt at all cost.  

There are actually two types of debt.  Good debt and bad debt.  Good debt is committing to an obligation that will increase cash flow, meaning putting money in your bank account.  Bad debt is an obligation to repay that has negative cash flow.  With bad debt, it is something that will drain your bank account.

Accumulate good debt.  Get rid of bad debt.  Simple as that.

@Pratik Desai  Several options. 

1. You can carry a promissory note on your property.  Using your first property as a collateral.  

2. A home equity line of credit will let you get the money out. HELOC will have higher interest rate.

3. Cash out refinance into a loan.  This will get you a lower interest rate.

You can get a FICO score, which is used by lenders.  Usually the full credit report will tell you 4 reasons why your score is what it is.

Here is the composition for your FICO score.

Payment history (35%)
Amounts owed (30%)
Length of credit history (15%)
Types of credit in use (10%)
FICO Scores will consider your mix of credit cards, retail accounts, installment loans, finance company accounts and mortgage loans.

More details here.  

http://www.myfico.com/CreditEducation/WhatsInYourS...

@Ben Leybovich Great picture.  I hope that is just for taking pictures, and you two stopped shortly afterwards and put helmets on.  Road rash takes time to heal.  ;-)

@Adam HalseyMy recommendation is for the first year or first six months, use a reputable property management company.  A reputable management company will have a written lease agreement, which is essential for good management and in some states, required by state law.  Ask the property management company to keep track of service calls to see the frequency of repairs.  If your property requires frequent service or repair calls, then having a property management company is essential unless you already know how to self manage remotely.  Also ask for a copy of the rental lease agreement, which you can use as a basis of your own rental lease agreement if you want to self manage in the future.

Think of property management fee as a "tuition".  :-)

@Patrick Donovan  Some tenants like to have control over their expenses, so I would lean toward splitting utilities if possible.  In your situation, let them pay for your air conditioning and credit them in summer.  Makes your rental more competitive when tenants comparison shop.

Just my 2 cents.