All Forum Posts by: Steve Hall

@Rein Garcia Who did you use in the states before? Why are you trying to switch to an overseas "virtual assistant"?

For those that don't know, here's what those virtual assistants in the Philippines do: They take on a lot of clients. (Mostly in the U.S. because U.S. clients pay the most.) 

They must work from 8pm to 8am (all night, their time) in order to cover all 4 US time zones.

The busy ones will work the entire time and work every day. (There are not many of them...)

The not-so-busy ones will only work from say 8pm to 11pm, and perhaps only 2 or 3 days per week.

Some of them speak English well, some of them not so well.

Ideally you want a call center based in the US to handle your calls. Nobody in the US wants to call a number and hear a strange accent with a name they can't spell.

For outbound marketing: Each day (or night for them) they call your contacts/customers and either collect the information you want, set an appointment to speak with you, or they leave messages on voicemail. If your leads or clients call them back (on US based phone numbers with a unique extension # for your company) they will get the virtual assistant's voicemail 99% of the time. Then, your lead or client does not get called again until the next time the virtual assistant is working! 

For inbound call processing: You always want your phone answered! If losing one lead could cost you thousands of dollars, employing a part time "virtual assistant" is a foolish way to cut corners and potentially lose thousands of dollars.

Call recording: Make sure they offer call recording (it will cost extra) so you can check on them anytime you want to make sure they are handling your calls the way you want and that none of the inbound calls are going to voicemail.

@John Huber

Yes to the LLC. This is a business, treat it like one.

Why would you vacation in your own STR?

@Elijah VanDenBerg

Why 3 properties?

Why didn't you identify the BUY side first?

Why limited yourself to NH or MA?

@David Vander Pol

Your bio says "I work full time in the entertainment industry, so RE investing is a side business for me at this point."

If this is a side business, then you probably don't want to be looking at 20k-30k rehab projects. They are very hands on.

That said, you haven't told us your investment strategy. Are you trying to do the BRRRR strategy, are you looking to fix and flip, or are you trying to buy an hold? Are you going to do any of the rehab?

After that we would need to see your analysis of those 50+ properties. Do you have this data in a spreadsheet, or do you have links to BP calculator reports?

We also need to know what you mean by "the numbers don't work"... Does this mean you can't get them to generate $10,000 per month? You can't hit 40% COCR? The cap rates aren't 20% or more?

There is probably a simple explanation that you are just over looking.

@Ashley JanulisWelcome to BP!

Offer $45k - settle at 50k, put $2,500 down, do the $20k worth of rehab and sell it for $100k. (If you can get $800+ per month rent, then I would think about holding onto it, refinance it, and pull out some cash.)

Just make sure there is no pre-payment penalty on the loan.

Oh and work on your credit. There is no excuse for "fair credit". Your credit score should be 700+ if you are under age 30 and 750+ if you are over age 30.

@Elliot B.

You're all caught up in "theory" and not thinking big picture. (Quite common.)

You can BRRRR large apartment complexes (with high cash flow).

As far as your concern about having "highly leveraged assets":

1. You're missing a key word: "performing". These are "high leveraged performing assets."
2. Everyone buys a house with 95+% leverage - and it's a non-performing asset. (Or quite possibly a liability!)
3. "Highly leveraged" is subjective. if you think 75/25 is too much leverage, then do 70/30 or 60/40. You're in charge.
4. Where's the risk in a leveraged lifetime buy and hold performing asset? If stocks crash, or another housing bubble bursts and my complex loses 50% of it's value (based on sales comparison valuation.) So what? I still make the same amount. I still pay the mortgage.

@Beth Matherne

If you have not closed yet, then don't sign until you have everything you asked for. (And make sure the RR is signed by the owner.) If the RR was misrepresented during the due-diligence phase, I would renegotiate AT CLOSING, or walk for "fraud".

I would NEVER keep on an owner as PM unless the place was immaculate with 100% occupancy when I bought it. (And then I would not have purchased it!) You've already got problems because you're walking on egg shells... "I don't want to offend the sellers"

If your seller is (or is going to be) your PM, then why are you blaming the seller's REA for not getting you a RR, when your new PM is the one who knows and produces the RR?

The laundry area should have been inspected by the inspector during the inspection phase.

UPDATE:

I just realized that I wrote this more thru the eyes of a large apartment complex. (Sorry about that). I am not re-writing it though because it is good advice for someone purchasing an apartment complex.

Since you are only buying a 4 plex, you should have asked for and received all 4 copies of the current leases during due-diligence. You should KNOW the rent roll (i.e. you could write it yourself). When you walk the property, just make sure all 4 units look lived in. (Otherwise a tenant might have moved out, and the seller failed to disclose this fact.)

@Sara C.

@Thomas S. is saying that you created the problem by attempting to force a GOOD paying tenant out. Your comment "I really don't want to get into an eviction or negative situation. She's been a really easy, paying tenant, but it's time for her to go" makes no sense to an investor. We don't push out good tenants... and we definitely don't evict them!

BTW, I think it shows a lot about you that you just publicly thanked 4 people in the post above this, but only the female got the up-vote. Bjorik, Thomas ,Theresa, and I all pointed out that the "smart move" is to sell it with the tenant in place, and not to evict a good tenant. I think you should up-vote all of the responses.

@Tomas Satas

The S-Corp LLC is only worth it if you you are making more than $50k-$60k per year flipping house. Otherwise just a straight pass thru LLC is the wise choice. The fact that you are asking these questions tells me that you don't have an accountant, so my advice is to hire an accountant and discuss this with him/her.

@Sara C.

Raise her rent! $200 per month should do the trick.

Why the rush to get rid of her? Why is it "Time for her to go"? If you're selling the property, many investors want to buy a property with a tenant. She pays the rent? She doesn't make a lot of noise? She doesn't complain? Dream tenant!

There's no such thing as 7 months of notice... everytime you accept her rent payment you enter into another month to month agreement. To get rid of a tenant, you have give notice. Then on move out day you have to post a Trespass notice (WITHOUT accepting rent payment). Then if they don't leave, you need to file documents with the court.