All Forum Posts by: Tyreek King-El

Does stashing away for vacancy really mean anything? The idea behind stashing for maintenance and Cap-Ex make sense, but for vacancy, say you start out with a new rental, and you put away 3-5% for vacancy per month. Let's imagine you're rented out for a full two years before you hit a month of vacancy, that whole stash is wiped out with pretty much one month's mortgage payment. The same doesn't feel true for a clogged toilet, or a broken garbage disposal. Does it really matter? Should you just get loss of rental income worked into your insurance policy? 

For a duplex I'll be closing on soon, the utilities were owner paid. Is it fair to say that that can go out the window as soon as the current tenants are out (which they will be before close)? And if so, for anyone who has used the RUBS system, what is your rebuttal for the instance that is a tenant not using the utilities that my RUBS system calculates them for using? I understand RUBS is a mathematical way to assume what each tenant uses, but truly how accurate is it? And lastly, anybody have experience splitting meters, how hectic is that process?

I am still buying. Threading the needle to find deals that cash flow in this high-rate environment will win!

@Theresa Harris so my thought is that the reno without increasing rent would only be temporary (duration of the rest of their lease). Just a measure of being a good landlord in my mind. The numbers work out really well even with me not increasing rent immediately as I am living in the bottom unit for the next year/1.5 years. Rather than physically cash flowing immediately, I'd be living for pretty close to nothing. Bottom unit won't be rented out until I move out. 

At the expiration of their lease however, I'd plan to increase it to what market value would be and if they can't rent at that price, see ya! All in all, increased rent is one of my goals, but it is moreso primarily to rehab the property and increase the value substantially which is why I'm after the reno loan. That was kind of my line of thinking, but I have never done this specifically so am open to any and all advice, thank you!

@Allan Smith a notice to vacate is a good idea, I'll look into it, thanks!

I have been going back and forth in my mind about how to go about rehabbing BOTH units of a duplex with tenants in the upstairs unit.

I thought to commence the rehab on the bottom, offer them to move into it once remodel is done (with no increase to rent for the remainder of their current term) then rehab the top unit and move in - OR - rehab the top unit while they live inside, for a decrease in rent for the duration of the construction. The latter could be harder to do as I am trying to replace the floors and shower. However, just trying to get the most bang for my buck with the VA renovation loan and maximize my appreciation potential and sell-ability later down the road.

What options do I have?

This is just what I interpreted from my lender. He stated that if they weren't signed up with the VA, there'd just be a bit of paperwork to be done, but yes essentially, I could still choose anyone to do it. Sound like you have some decent experience on the process? Would you be able to tell me the overall order of events for choosing someone? That part I am still unfamiliar with

Inspection contingent, I should be closing on my first duplex using VA renovation loan in Mid-April. Looking for VA licensed building contractors for renovations and a structural engineer in the Hampton Roads, VA area (Norfolk, Virginia Beach, Hampton, Portsmouth). Anyone here know anyone or might actually be one? Let's discuss services!! Thanks!!

Pretty much settled on what my 2nd door will be. It's a mild fixer, which is what I wanted. I am confident I can bring the value up to $360k+ using comps from some nearly identical but outdated homes within 0.5 mile. I will be using the VA loan. My dilemma is this:

Stuck between using normal VA, $280k pp @ 5.35% and using $15k of personal investments (which I am really tied to because it wasn't easy accumulating) to fund cosmetic upgrades (upgrading floor to LVP throughout, resurfacing + painting cabinets, replacing counter tops with quartz, exterior/interior paint, appliances, and a new front door). Monthly payment roughly ~$1890 before utilities.

OR

VA renovation loan, $300k pp (includes $20k for reno) @ 5.85%, monthly payments ~$2089 before utilities. Plans are to for sure IRRRL when the opportunity presents itself down the road. Will pay roughly $2500 more over the course of year 1 overall, but about $4k more in interest over year 1. I don't know whether I should be hung up on that fact or not.

The way I see it is that the leverage provided to me should be a no brainer if I'm comfortable with the payment. Especially if it can appraise properly. Part of my worry is whether or not rent rates will support cash flow in a few years when I move. I know they're beginning to trend down at the moment, and it's causing me to be forward thinking, maybe too much. The house is gonna look modern and awesome when it's finished! Can I rely on that? Any advice for other high-grade renovations? Any reno you recommend completing myself?

I am providing my Tax ID Number and an address for my property manager to send my end of year tax forms to for my rental property. While I have funneled all funds through my business bank account, the home was not bought under my business' entity. Am I able to provide my company's Tax ID number instead of my personal one in order to essentially tack this past year of rental income onto the financial history of the business?