All Forum Posts by: Travis Lloyd

Ok so the bad news first: no matter how "illegal" his plumbing is, only YOUR renters insurance would cover your personal belongings. Now that doesn't mean the landlord couldn't go out of his way to help - but he is not required to compensate you for your belongings. That is why renters insurance exists.

On the other side: I would pay the rent in full, and probably move. The reason I would pay the rent is that were he to file the papers to begin eviction proceedings, your name will permanently have that associated with it. This may not come up through all rental background checks, if the papers are withdrawn shortly after being submitted, but depending on the company performing the background checks - they may in many cases be able to find records of the filing for the eviction! Even though you were never evicted!

Why should you move? This event sets a dangerous precedent. You had a problem, and from the landlord's viewpoint "threatened" to withhold rent. He countered with eviction proceedings, and you paid. So what happens next time you have another legitimate problem? The story repeats.

Now I am usually on the other side of this table, (i.e. the landlord or their agent), but I hate nothing more than people giving us a bad name. So once you do decide to move (and only if you decide to move) call code enforcement, and the building department. It couldn't hurt to e-mail photos of the plumbing to both departments as well. The reason I say only to do this if you move is once again - think of what this will do to your relationship with the landlord. You will now be the "problem tenant" and thats never a good spot to be in. Not that I'm calling you the problem - but you will be branded nonetheless.

Sorry, but that sounds like the only way to go forward.

Hey i'm running out the door but don't want to forget this post. Send me a PM and lets talk about how you're approaching the marketing. I may be able to offer some help.

You should speak to a mortgage officer for specifics, but what I believe you will find is that you would have a difficulty qualifying for both a mortgage and a personal loan. Right now, provided your credit qualifies, you may have no problems getting qualified for a $15k personal loan OR for a mortgage; however, as soon as you go and pull either one of those - you may find it suddenly much harder to pull the other loan. It is for this reason that they came out with the 203k - so that you roll the entire amount into one loan that you can qualify for.

The cost to have someone demo the existing tile is not expensive. Laying new tile takes a bit more precision. Make a few calls to local smaller contractors to see how much they would charge to take up the tile and thin set - you might find that for a little more than renting a machine yourself, you could enjoy a day or two less of frustration and have it done. Then lay the new flooring yourself (I agree with using tile rather than laminate for the new floor - lasts much longer).

Wow - welcome to being a landlord! The answer lies in your lease. Does it specify or stipulate how the security deposit will be calculated and returned? Does it specify that leaks / damage / problems must be reported to you within a set period of time? Does it specify that the tenants must use AC filters?

If you didn't specify filters - you probably cannot line item that. If you didn't specify notification of a leak, I would give that one 50/50. The dog sounds like a blatant violation of the terms of the lease. Simply put - in violating their lease, they could forfeit their security deposit outright (again, depending on how the lease stipulates return of security deposit).

But line items aside, they damaged the property. I would keep their entire security deposit. Take the situation to its hypothetical worst conclusion: the former tenants sue you for their security deposit. You will need to prove a) the condition of the property before the tenants moved in b) the expense associated with repairing the damage (PAID invoices from contractors) and c) that none of the work constitutes an upgrade from the condition of the home prior to their lease. As long as you can prove all of that in the event they sue, keep their security deposit. Make an itemized list of all of the damage, and send them a letter explaining that their security deposit has been held in full to cover (sounds like only partially) the costs of repair.

To be perfectly honest, @Bryan O. has a good point. Real Estate Investing is something that anyone CAN get into, but not something everyone SHOULD get into. Those programs that charge thousands to "learn the art of RE investing" are not making money on their students success, but on their students attempts - win, lose, or draw.

Hone a skill set that can be of use to an investor and intern for one. Show diligence and hard work and turn that internship into a job. The education alone will help and along the way, you will find out if the field is really something for you! If so, working for an investor will help with the savings issue and you'll be on your way to your own deals.

"Never give up on a dream just because of the time it will take to accomplish it. The time will pass anyway." But the other side to that coin is be sure you're interpreting the dream correctly

While I am not a mortgage banker, I believe what they are telling you is correct. The 2-4 unit exception is only applicable if it is your primary residence.

Rates will probably go up in 2 years - although I have been hearing that for the last 4 years so take it with a grain of salt.

I would recommend keeping mixed used commercial/residential on the table as an option. In many instances, you can triple net the commercial space sufficiently to cover your debt service, with the residential offering greater mobility in the short run. Hire a management company to service the residential units only, and you avoid the 24/7 phone call headache. But vacancy in commercial space is no laughing matter. 10 year leases are great, but 18 months of vacancy at the end of that lease can bankrupt small investors. Having sufficient cash flow from residential units with shorter leases can offset that risk. Also, shorter 1 year lease terms allow you to capitalize on market shifts in rent.

Just a suggestion to keep that door open.

Second notes are notoriously poor investments as they get very little if you go through with a short sale or foreclosure. Perhaps your owner could shop around the 2nd note to investors in exchange for equity in the buildings. Their returns would still be subject to the debt service on the first notes, but their equity would protect them. If the owner owes $429k on both, but only the second mortgages pose the problem, and say those total $120k, then they would be worth on the market $120k / $320k (current value) 37.5% of equity. Offer 40% to make it attractive and perhaps she can avoid the loss and credit hit.

Hello Bigger Pockets!

After exploring the forums for a few days, I feel so excited to be a part of the energy and attitude of this community - with so much open advice and so few pitches for "get rich by using my system at $20k a seat"! As someone with a lot of experience in the field, I get so tired of the companies offering to "help" for such egregious fees.

I have worked for a few RE investment groups, with projects up and down the East Coast, with holdings of $5m - $150m. I have experience with single family homes, multi family (up to 300 units), and mixed use res/com. My expertise is in financial modeling and operations management.

I still work for one of the big boys, and am finally setting my sights on building my own portfolio. Sadly, my debt (read 'student loans') needs to come first so I may be a year or two out from my own investments. In the mean time, I'm looking to expand my network nationwide, swap notes and hone best practices, and offer assistance in any way I can.

Looking forward to meeting you all!

-Travis