All Forum Posts by: Sylvia H.

this is--complicated. 

1) I don't know CA but MA has some of the strictest lead laws in the nation so it may be comparable. You may be looking at "strict liability" meaning any kid in that apartment that has elevated lead levels can hold you responsible, they don't have to prove that it was from the house and indeed it very likely wouldn't be. 

2) with the tenants aware of this and needing it remediated you are going to have to do so, pretty much immediately if there is a kid in there or about to be. In MA I think you have 90 days before your liability kicks in. Don't quote,  me this is from memory and I'm not a lawyer...but its something like that. This is going to be true even if your seller is provably at fault and you can hold them financially responsible. It is your problem now. Oh by the way, this often applies to any child under 6 just visiting :)

3) First call to a lead remediation company which can examine and make recommendations. Its not always grotesquely expensive. There is interim control, painting only certain areas etc. often around door frames and older windows...but it can be tens of thousands of dollars in a worst case scenario.

4) Second call to a qualified attorney who specializes in this area. Pay him/her, do not go cheap and find a generalist or a brother in law or what have you. Let them guide you. 

5) Get moving quickly on both ends (the remediation and the attorney) immediately and my gut is you will be able to hold the seller accountable. This is one of those rare areas where it can be pretty cut and dried and in their best interest to provide you some financial relief. And they are flush from the sale now as well.

You never know, it might be a long ago citation for a minor thing that was painted over and this will be a trifle, but....

6) Get the tenants on your side by doing everything within deadlines and keeping them in the loop. Its going to matter. FYI you will likely be responsible for providing them housing during the entire remediation process, short or long.

7) Seriously, people have many ways of dealing with this before its a documented issue, but once it is public it has to be handled properly. You are tremendously exposed. It may be next to nothing but don't be shocked if the bill is all out of keeping with what you think of as the scope of work. The company performing the work takes on the liability and they are going to charge you for it. DO NOT get the same work done by an uncertified company even if its just as good...it doesn't cover you and will hurt your resale value.

8) I'm writing this from a liability perspective. The medical issues surrounding actual lead poisoning are devastating and you have a moral obligation to deal. 

9) I'm talking about liability more than health because we all grew up in houses with lead paint and actual poisoning was rare.  And even pre 78 houses have had so many renovations stuff is often buried under layers of changes and isn't a practical problem with reasonable parenting and reasonable maintenance. This cuts both ways though--for something to be elevated to public record means it often gets heightened attention.

10)'acceptable' levels have been lowered and lowered and so even though kids may not have had major exposure as youths the standard is much different now. Acceptable levels have ranged from 20s and are now at 2-4 to give you an idea of how different things are now.

Good luck, do not panic, but face head on and quickly

 Hey Sylvia, according to the insurance company since I didn't have the property for more than three months there was nothing they could do since the policy I had (which @Michael Norris nailed) was a vacant policy and all it covered was vandalism and not the theft. Even though they did rip pipes out of the walls. That is still considered theft. What I was told was that if it had been three months and day after acquiring the property they would have covered it. Go figure. Definitely a learning experience.

Thank you all for your feedback. Now I'm just trying to figure of how I can come up with creative way to generate capital to continue the renovations.

KB

Good Evening BiggerPockets Family, I'm new to the forums and have been looking to see if I can find a solution to my current problem. I have a 2 unit, 1b, 1bth duplex in Jennings, MO that I acquired back in July. Now I should preface this by saying I've learned from this experience and l'm still learning as I've only been doing this a few months. With that being said. I acquired this property with a HML and about 30K for the rehab budget. The rehab was two months in and a little over budget when the units were broken into and major items including the pipes, water heater and condensers were stolen. Insurance isn't covering anything and I'm hoping there's a solution to resolving this where I can fund the damages and complete the rehab and keep the property even if it takes some time to recoup the loss. What are my options or vehicles available to me? If any? I welcome and appreciate all feedback.

What do you do for book keeping for your first rentals?

Hello everyone, I’ve been debating back and forth whether to sell my property or not. 

I own a 3/2 1200sqft sfh in Ft. Lauderdale built in 1958 that I purchased in 2020 for 235k. I put a new roof and did minor upgrades on the interior, paint ceiling fans etc. Fast forward, I got married and moved in with my wife who had a newly built town home. 

I’ve rented the place to friends short term (month to month) but now it’s gonna be vacant next month. My long term goal is to have enough properties to cash flow about 6 to 10k per month. I’m mid 30’s and do about 90k per year at my full time, my wife does about the same. The property can sell for about 350-385k right now. My mortgage is about 180k 3.5% interest rate. My monthly expenses are about 1600 (tax insurance mortgage). Rents currently are from 2300 to 2700 per month. Airbnb seems to be about 120-150 per night. I want to own more properties and considering the age of the property, the equity, and the tax situation was considering selling to get more capital to invest and have ready if the market dips a bit next year.

1) Do I sell now and take the profit and try to purchase 2 properties next year? (I was thinking I’d be able to take the profits tax free since I owned it as a primary for over 2 years).

2) Spruce it up a bit and get it ready for new tenants to lease annually? ( it’s gonna likely need paint, new washer/dryer and stove)

3) Fix it up and furnish it for str abnb? Not my fav option because I’d have to put a lot of money and time into it to furnish and manage and I don’t have a pool and I’m not sure I’d get more than 150 per night and with vacancies that’d be comparable to annual lease rates.

Thanks I’m advance for taking the time to read my post and share your thoughts and opinions.

We own all our properties in LLCs with mortgages in our personal names as we switched them to the LLC after purchase. We never had problems with mortgage companies accepting the insurance in our LLC names until this year. 2 of them sent letters saying we have to have the insurance in our personal names which opens us up to liability exposure. We could have us as primary on the policy with the LLC as additionally insured but I don't like the exposure that gives us. Is anyone else having this happen and are there any solutions or workarounds other than refinancing at higher interest rates to a commercial loan or paying the property off?

Hi, I recently inherited a 6 unit apartment building that is located in a prime East coast location. Three of the 6 tenants have been there for a long time and the previous owners chose to forgo raising rental fees on a regular basis. Since the building is now under new ownership my real estate attorney informed me that I can increase rental fees above the 3 to 5% norm, for those who are significantly under current market rental rates. One tenant is at least $1K under market and the other two are $700 under market. The state has no limit on rental fee increases; the critera is that the tenant may not consider it unconscionable. The attorney cited an example of a landlord who purchased a property, raised rental fees by 20% and the tenants hired attorneys to contest and the landlord negotiated a lesser increase. Based on thousands of dollars invested in improvements and repairs, I believe I can substantiate a 20% increase. However, I also am concerned about relations with my tenants and want to avoid additional attorney fees to address tenant opposition. I would love to hear others' perspectives. Thanks in advance. 

1. How frequently you are getting property inspections done? Quarterly or once in six months or yearly? Or when there are some repairs done and you want to validate the repairs?

2. Rather than doing inspections what if you ask tenants to provide the images and notes?

3. What if tenants don't provide the images and notes?

4. How much advance notice you need to provide to the tenants before inspections?

5. What if tenants are given 1-2 weeks notice but even then tenants are not willing to let you for property inspection?

 Thanks for the insight.  I can understand that point of view.   That is not my intention.   My intention is to create a new life in a new area for myself.  And house hacking makes this doable for my situation.  I appreciate that point of view and definitely helps me understand the reasoning from uw.