All Forum Posts by: Thien Nguyen

Hi Jeremy, I'll be dropping by. Thanks for setting it up. 

Hi @Lori Greene, @Kenneth Mooney, and @Jan Kerr,

Thank you for your advice. This is my first renovation project, and I expected some hiccups but not quite as large as this. I realize now I need to balance best pricing with reliable quality work along with strategic payment plan. I guess you could say he charmed me with his bravado early on only to realize the unfortunate truth. I will take these advice onto my future projects. 

Hi all, thank you taking the time to read this post.

I have a property undergoing complete remodel in Augusta, GA. However after my contractor received his 2nd draw at the end of Sept, 2019 he stopped showing up to the job. The situation has escalated and now my case is peculiar.  My construction manager and I are working to find the best avenues to move forward. The following are current issues.

1. The contractor has passed his deadline for project completion dated Sept 29th, 2019 and he has not even finished the roof replacement and wall reconstruction. He stopped showing up to the job site after getting 2nd payment around Sept 24th, never finished the roof and walls, and his incompetence on a replacing a flat roof recently led to water completely soaking one of the room and causing some damages.

2. When I first employed him, he advised me he was a general contractor with insurance and everything. I come to find a month later after we signed a contract when he was suppose to start that he did not pull any permits, (contract indicated contractor is responsible for the permits). He advised me that he had to get these permits pulled by another person with a general contractor licences as he now does not have one. (I understand this now to be an extreme red flag, and should have stopped the process however in hindsight he was offering extremely competitive pricing compared to other bids and some of his referrals stood true so I decided to move foreword). He charged me $2,000 as per the "other" general contractors condition to have the permits pulled. I find out now after speaking with the "other" GC my contractor shaded the "other GC" only gave him half. The contract I have with my contractor has no mention of the "other GC". Is this consider a "fraud" and I have a potential legal court approach to take?

At this point in time, I have already paid the contractor 2/3 of the payment however I no longer trust he is competent enough to finish the job and decided to fire him. I asked him for the 2nd draw back so I can continue on with another contractor to finish the job and take the loses as it is. He however advised he no longer has the money. I am having my construction manager go after his bond in efforts to recoup whatever loses we can. 

Does anyone have ideas on what options I have moving forward? 

Thank you for your input @Tom Ott, at the time I wasn't fully aware of what a turnkey company was all about. But experience gained none the less. 

@Tom Ott, This was a subpar local turnkey. They advertised as turnkey, however there were not tenants. They were pretty much flipping and selling move in ready properties to investors. 

@Jonathan Oh, My lender did not require an inspection, rather just an appraisal. Granted, it took several months before I was able to place a tenant in the home. 

Hi there @Will Fraser, thank you for the kind words of encouragement. 

My goals are to expand my portfolio into small to medium multifamily properties with cap rate above 8% in great potential markets. 

Investment Info:

Single-family residence buy & hold investment in Augusta.

Purchase price: $58,500
Cash invested: $15,000

Purchased this simultaneously with another property. Had same lender do a dual application, and both properties were approved for loans at the same time.

What made you interested in investing in this type of deal?

Cash flow

How did you find this deal and how did you negotiate it?

Realtor

How did you finance this deal?

Conventional bank financing

Lessons learned? Challenges?

This property was supposedly turnkey. However issues arose that proved otherwise. Plumping and the heating system were nonoperational, which didn't manifest until after tenants moved in.

Investment Info:

Single-family residence buy & hold investment in Augusta.

Purchase price: $48,000
Cash invested: $10,000

Class C property in a class C neighborhood boasting 10 year long term renters.

How did you find this deal and how did you negotiate it?

Realtor

How did you finance this deal?

Convention bank financing

What was the outcome?

Cash flowing well

Lessons learned? Challenges?

Ensure inspection is air tight
Negotiate hard the deal to cover foreseeable repairs

@Dennis Adler. That's awesome Dennis, keep up the work. 

1. My property's rent was already close to 2% of the purchase price before I bought. 
2. This is typical for the Augusta area I feel. The home prices don't appreciate as much compare to other areas, but in terms of rent to property price its great. 
3. Estimate repair would be around 2-5K, but its variable depending on the conditions the property was purchased in. 

Investment Info:

Single-family residence buy & hold investment in Augusta.

Purchase price: $48,000
Cash invested: $10,000

Managed to get 15% down on a high cash flow property in Augusta, GA. Property came with 10 year tenants.

What made you interested in investing in this type of deal?

High ROI

How did you find this deal and how did you negotiate it?

Off market sale whiling putting another property contract.

How did you finance this deal?

Traditional financing

What was the outcome?

Property cash flows well, however tenants started paying late. Never defaulted on rent, but the repeating lateness is not optimal.

Lessons learned? Challenges?

Some items in home were nearing end of life. Know now to not be afraid to renegotiate with seller to better ensure less maintenance in future.