All Forum Posts by: Michael Totman

Haven't seen this brought up yet, so just make sure whatever amount of deposit you demand is within the law in your area. We are limited on what deposits are for and can be in this area, but otherwise everything else everyone else said; and move on from this one.

Is your $215,000 taxable gain and $25,000 tax accurate after including all the tax accounting entries?  I'm not an accountant but I don't know...Regardless the numbers, the question is do you want to wait for 10 years to MAYBE get some appreciation while having negative cash flow or take $190,000 into the bank today? I'm taking that cash all day.  Who knows what the market is in 10 years, what major repairs will be needed in 2 years, what major repairs will be needed because of tenant issues, whether or not you can keep it rented for the next 10 years solid, will Ft Lauderdale be above water in 10 years if you believe what certain people say, and any number of other things that can happen to this property that currently costs you money every month. How much are you negative each month? Divide that into $25,000, or whatever the tax bill will be and that's how long you can operate until it would cost less to pay the tax bill today. You didn't buy the house for an investment, so take your profit and reallocate somewhere with intention.

Other types of loans? Could be.   What experience do you have? What other income do you have from investments to prove you can make the payments? What cash do you have in the bank?  Did you lose the job or did you quit because you didn't like it? Going to be tough for typical lending with none of the above and limited job history.  Maybe focus on the job and then the lenders will come.

You did answer it in your original question: with money on the line he might be more reliable. Key word, MIGHT. Willing to chance it? Why would he be more reliable to you about his money if he lies to you for free to start with? 

Either way the tenants will be pissed, as for difficulty it's a matter of lease and contract. In either case I'd go market rents and tenants pay utilities, but to answer the question it's likely easier to raise rents depending on the current agreements and State law.  Never pay utilities when it can be helped, no matter how many "my tenants are so grateful and never abuse this privilege ever" stories you hear.  

Was he talking to you from his Cayman bank? Damn, must not be a tenant friendly State. Can't imagine doing that in Mass and trying to get those tenants out when the house sells...

The most important thing to do is something.  Sounds like you have little to no experience, got any money? Shore up your finances, credit, and act as if you were interviewing for this job every day. Look at listings, run your numbers, and attend meetups. Don't do this too long, as soon as you can jump in and buy but buy smart. So long as it's not a horrible deal then just buy something, or start working for someone who is buying things. If I knew what I know now at 20 I'd start hustling for free for the top agent or landlord in town to learn everything I could, then I'd buy at least a duplex to live in. 

Some of the best lessons come from the worst tenants.  Adjust your screening process and lease going forward to cover what has happened here. Learn and move on, all you can do. 

Dropping from $1,500 to $900 may attract unqualified tenants, but from $3,100 to under $3,000 wherever you land is still attracting people willing to pay $2,500 or more on rent. It's up to you, but the thing wrong with the apartment is the triple whammy of rent, move in costs, and time of year. 

Try to lighten up the move in money requirements.  Would you rather lose $3,100 every month while you wait, or only $300-$600 and get someone in for less than max rent sooner? If the specific neighborhood isn't the issue and it's just timing then remember to make your future rental contracts expire outside of the slow period.  If you've had 0 to a few prospects then it's likely the cost preventing more interest.