All Forum Posts by: Tim Hoffman

Most attorneys that handle evictions have been in this situation before. Your situation is similar to a tenant moving out and boyfriend staying behind with no lease. If you are a member of your local investor / landlord group ask one of them. If not, find out what day eviction court is and show up. There will be several attorneys doing evictions. Just listen to a few and grab one you like when they leave court.

Good luck.

I pre screen callers before I let them see the house and waste my and their time. During these calls you get all kinds of stuff....

When asked how long they had been on their job and how much they made per pay period they replied, "That is none of your business!"

When a prospective tenant called about a 2 BR home I had available, I asked whey they were moving. They replied they needed more space. When further questioned where they lived and how long they had been there they said they lived in a 4 BR house for the past 6 months. When I told them they were calling about a 2 BR they said that is ok, they needed something fast because they had court later that week and would not be able to stay at their current place.

A prospective tenant said he had move to the area from out of town about 4 months ago. I asked what brought him to town. He said he moved to be closer to his girlfriend, (there was a woman with him). I asked her how long they had been together and where she lived. She quickly responded that she was not the girlfriend he moved for and they "met in a bar about 3 months ago and the rest is history". I had to bite my lip to keep from laughing in her face.

Love the post. Keep it going.

Short answer is YES. You have made a reasonable attempt to contact them and they are either in denial or willfully stealing time in the house as a trespasser.

I suggest you get with a local eviction attorney and see what options you have. The faster you move on this the less it will cost you. Who knows what they are doing on the inside - damage wise - and look at all the lost time and $$ they are costing you. Call today.

CONGRATULATIONS!!!!

Very good idea to manage yourself to learn the business. Good luck and hve a great 2014.

Wow Thomas. With that 4 part question be prepared for either VERY long responses or no responses. I will try to get things going for you.

1) Figuring out my first deal is a little difficult. I had been studying RE like you and I had a local investor guiding me. After reading, looking, asking and attending local landlord club he told me to either invest or stop bothering him, (do or don't do but make a decision and go with it). I got with a realtor and found a really beat up 3/1 SFH on the MLS for about $10k (1999). I put an offer in and we had it under contract soon after. While waiting to close on this REO property, I was driving for dollars and found a FSBO sign in the window of a little 2/1 SFH. I called and we struck a deal for $15k (it was basically rent ready). We closed on that property before we closed on the bank owned beat up. You decide which was the first deal. I paid for them using savings and a HELOC on my principal home. I guess that answers how soon I moved on to the next deal also. When my mentor told me to act I went into full beast mode.

2) As for the Best deal, that is hard to decide. I do not buy unless I believe it to be a great deal at time of purchase. The best deals have not revealed themselves until way after the fact. One in particular goes like this. A friend bought a package of 5 houses. There was 1 that he did not want and asked me what I would give him for it. I told him I did not want it but he persisted. I eventually bought it for $7k. No furnace, no kitchen, no bathroom, and about half the windows missing. I sold it on contract for $1k down and $200/mo for 5 years. After about 6 months the buyer lost his job and gave back to me. It now had a furnace, a rough kitchen and a partial bathroom along with all windows. I then sold it for $2k down and $250/mo for 5 years. Once again, after about 3 years the buyer called and said his son moved out and he did not want the house. He gave it back to me. It now had siding on 2 sides and the rest in the garage, a better bathroom and a full albeit dated kitchen and the windows now actually kept the weather out. Before I could "sell" it again, I got a letter from the City saying they wanted it for a road project and they would give me $20k and I could keep the furnace. Just goes to show that sometimes the best deals are not revealed until way after the fact.

3) Worst deal is one that a friend warned me about but I "knew better". $18k for a 2/1 recently "updated" and rent ready. It was right behind a local housing "project" for low income people. The first tenant rebuilt a motorcycle int he Living room, destroying the carpet, had to be evicted and left me about $3k in damages. While vacant an enterprising neighbor decided to recycle the siding. The neighbors in the projects kept tossing their trash into my yard and after about 2 years I sold it for $10k. Happy to be done with that nightmare. I learned never to buy in an area like that again.

4) My strategy is to buy / fix / hold. I started in 1999 and I currently have 66 SFH that I rent, 11 of which I own outright. This is my sole source of income to support my family and I would not change it for anything. I only buy if I can borrow the total purchase and rehab costs once the property is renovated. I work with a local bank that will loan me up to 70% of appraised value (ARV). As long as that cover my entire investment and it generates close to $200/mo (cashflow AND debt paydown) from day 1 I will make it happen.

Good luck and as my mentor said. Buy something or stop pretending. The only way to get into this business is to take the first step.

Your lease should mention any personal property (lawn furniture, stove, fridge, etc) and who is responsible. If you left them for them to use "as is" I would say you are out of luck. If they were there to be used and they were responsible for them (excluding normal wear and tear) then they would be responsible. Deduct them from the deposit. If they became rusted and bent during normal wear and use the tenants should have kept them for your inspection. They did not so they are responsible. At $20 though it may not be worth the hassle if they make a big deal or want to go to court.

Wow, a lot to go over.

First I will address the last issue first. Even though I am in IL, I would assume you could get an appraisal that would show the value of the land and the improvements. I dont care were you live, a house and garage are more than $40k. Especially in SF. The appraisal should cost $250-$500, (i assume the high end in SF).

As for the rent vs sell that is a personal decision. Have you ever been a landlord before or do you have an experienced landlord who can help you locally? What would a property manager cost in your area?

You say that your home will not go up in value in the next 3 years but I find that hard to believe. Especially in the SF area. I would get a professional opinion on that too.

Based on the figures you gave, you will be able to rent for more than your costs by $200-$500 (not counting vacancies or repairs). That could make renting your new home that much cheaper.

Renting you get some tax advantage on depreciation, 2 more years of debt paydown, possible appreciation, and a place to come home to when your new job is over.

Selling would result in a taxable transaction if you have used the homeowners exemption in past 3 years. Cash in your pocket if you havn't. Why not roll the cash into a new home instead of renting? How about buying a duplex or home with an income suite in basement /attic / garage..... and use the income to offset your mtg?

Good Luck.

@Eric F. , Thank you for the advice. I never thought to even look for a chicken coop tour. There are so many other garden tours in this area I am sure there is one relating to chickens. Thanx again and good luck with your Spring project.

First, I would NOT put the deed in your name. Why do you want to be responsible for a loan where the asset is just enough to cover the debt? If a tenant does a lot of damage or you have several months of vacancy it comes out of your pocket and your name, not your fathers. Worst case, you let the property go back to the bank and your father (in Mexico) takes the hit, not you. Secondly, I assume your father has been depreciating the property and the basis is lower than the current market value. If it stays in your fathers name, when he passes, you get the property at a stepped up basis (market value on day of death). For example, say he paid $100k and has depreciated it down to $80k with a $90k mtg. Put in your name and sell for the $90k mkt value to pay off the loan and you have a $10k capital gain. Now if he passes and you inherit the home at $90k and sell it there is no taxable gain.

As for the managing and signing leases. You can sign a management contract with your dad, (This gives you permission to manage the property for him). Unless there is a law against it in your area, most municipalities will allow you to manage a property for a family member without being licensed. Check your local rules to be sure. Bottom line is this will probably never become an issue as long as you are acting in the best interest of all involved.

Good luck.

You need to find a trusted financial advisor. Not necessarily a professional but someone (family, friends, church member, neighbor, .....) that has a proven track record with finances. Sit down with them and get their input and then do what they recommend. You and your sister have gotten used to free or reduced rent and spent your rent money on other things. Time to become an adult with regards to money. As a general comment, debt consolidation loans are rarely a good idea because the underlying financial issues need to be addressed not just a shortage of immediate cash. Think about it, I am going to get out of debt (relieve my debt issues, etc) by Borrowing more money. That is like a smoker saying he is going to quite smoking by buying a carton of cigs.

Good Luck