All Forum Posts by: Stetson Oates

I think you may have received some bad info. I invest in Oklahoma City and haven’t heard this before.  

Ouch, I hate that this happened.  Id be upset too.  I think the best move would be, get this property in top shape while you are fixing other issues.  Make sure everything is in great condition, then find a tenant worthy to rent it. I think in time it will make you whole again. Then I would have a conversation with the seller, then move on.  It's a lesson learned, but you turned lemons into lemonade.  I'd be really upset too, people are disappointing sometimes.

Hello,

Sorry for the issues you are having.  I will say for HVAC units,  sometimes it depends on the contractor you are using.  I've had contractors come to my properties and tell me I need an entire new system at a cost of $6,000.  At that point I remembered I had a home warranty policy.  I placed a claim, and the tech came and replaced a capacitor for $75. I got the tech's contact information and used him on all properties. He ended up being a fantastic contact for me.

Quote from @Leroy K. Williams:

Hi Melissa,

if a tenant has occupied your home for 3 years you should expect that at the point you are turning it over to a new tenant there will be something needed besides light cleaning.  If they have not hit the previous PM with maintenance calls you should look at the $4,000 as deferred maintenance.  Even in the best scenario you would have spent $1,500-$2,000 to update the smoke detectors and C02 testers, cleaned the carpet, re-glaze the bathtub, update any leaks and light paint and wall repairs.  

Going after a tenant who paid for 3 years on time is extreme. Move on.  Someone should have done a better job of inspecting prior to returning the security deposit. 

When you turn over the property some expenses are to be expected.  If they harmed the property with actual damage I would immediately demand payment, send to collections, and file a lawsuit in SC court.  You will never see the money but at least they will not be able to hurt another landlord this way.  

There's a lot to unpack there I think.  This is a viable strategy as I almost did this my self.  I ended up going a different route but this is as good of strategy as any depending on the terms on the SBLOC. Betting on appreciation for the recapture of initial funds in this market with a refi may put you negative cash flow. I would keep that in mind.

My question would be about recourse on the initial lender who foreclosed. Is there no requirement to identify other lending institutions?

Quote from @Todd Dexheimer:

I agree with what you're saying, but as others have mentioned, it still matters. What I wish people would stop saying is, I own 1,000 doors, when they actually own 5% of 1,000. 

I met a group a few years back that owned 2,000 units. They brought a deal to Endurus to partner with them. After talking with them, I found out that they needed us for our experience, liquidity and net worth. When I asked how much liquidity and net worth they had, they said less than $100k liquid and less than $1mm net worth. How do you own 2,000 units and not have well over a $1mm net worth? The only answer is that you own a fraction of the units. 

It’s the same thing as owning Apple stock and saying you “own Apple.”  At the very least, it’s misleading. 

I wish I would have started sooner. I regret that and hope I can make up for it.  In a lot of ways I came up in the 2008 crash and didn't see RE as a viable investment option.  Looking back I was young, dumb, and stupid.  Coupled with the fact that I didn't have any money. Still I wish I would have started early.

The fundamentals of a company always win. Ive seen so many investors leverage themselves to the max and be barely successful. Now we will see how many of them will survive. Debt is and has been a tool to be used wisely, I wont do a deal more than 65% LTV or free cash flow me $500/mo. I'm not going to work for $100 a month. I don't understand how these investors who have 100 doors and $85 Million in debt sleep at night. Sure you are cash flowing but who's responsible for the $85 Million? You're worth $15Mill? Sure. This market will reveal the skeletons in the closet.

I wouldn't consider this. Debt should be used responsibility, a 100% LTV deal would sink you quick if it went south. Down payments are a good thing for you, put as much down as you can.