All Forum Posts by: Ed L.

@Wayne Brooks I wasn’t trying to get into a philosophical debate about government policies.  My point was to thank Michael for clearly detailing out the rules.  

I’ve been a real estate agent and investor for over a decade and have only had this come up on a handful of occasions and prior till today no one has detailed out the rules to me  personally.

These rules concern a fairly narrow set of circumstances that many investors will not encounter until it’s causing a problem, so no I don’t consider it common knowledge outside of lending circles.

Not being able to sell a home for a profit for 90 days is from my perspective a fairly arbitrary guideline.  I understand the underlying rationale but why not 60 days?  A year?  3 years?   By definition it’s an arbitrary amount of time.  

An arbitrary amount of time that can add thousands of dollars in unnecessary holding cost and slow the flow of capital.  

It’s not something I’m terribly concerned about as an investor but I’m sure appreciative for the OP taking the time to post what some consider to be common knowledge!  

I’ve encountered this issue on numerous occasions.  It’s never stopped a transaction but it’s a definite headache and head-scratcher not knowing when these arbitrary guidelines apply.  Thanks so much for posting!!

Wow, I posted this thread over 5 years ago lol...  oddly I can't remotely recall the project.  

Note to former self.  Tub and tile refinishing.  If it's a high end flip by all means go in and rip the old tub out and retile.  On a mid level flip spend $300 on having the tub and surround refinished.  

@Jim Adrian that's probably what I should do.  It's just kinda hard to tell someone "no" I'm not going to accept 2 months of prepayment when they are taking decent care of the property and don't have pets.  

I swear everyone seems to have indoor dogs nowadays. 

@Deanna McCormick what about applying a partial prepayment to the account?  

I know some people do this with utility payments.  Water bill is $30 per month and they will send in $100 to be added to their account. Next months water bill will be applied to the credit on the account until its drawn down and there is a remaining balance left over.  

Somewhat of a follow up to my question last night.  

My lease agreements dictate a $20 late fee for rent received after the 5th and then $5 per day for any rent received after the 10th.  

I have a couple tenants that are routinely late but always stay current on their rent usually paying by the 15th.  I don't personally have an issue with this as it results in an additional  $45 per month in cash.  

The problem arises when a tenant isn't staying current.  I have 1 property with tenants that are chronically late and keep getting later dragging into the next month.  At that point it's like a snowball.  

I've somehow managed to avoided having to evict anyone in the 5 years of owning and managing my own rentals. 

So say for example it's the 20th and tenant hasn't paid. 

I finally decide to send out the 3 day notice.  Do I include the $800 rent + $70 in late fees in the notice?  

The reason I ask is because I used the rocket lawyer site for a template on my last 3 day notice and it stated that late fees where not to be included in the notice. 

Further complicating things is the fact the late fees change on a daily basis with my current penalty structure.  

Thanks to all that have responded.  You seem to be confirming my concern.  

What about the route that @Robert Herrera mentioned if say "bob" wants to prepay for 4 months can I just get them both signing an acknowledgement stating that the months of April and may are being prepaid.  Then they can sort it out amongst themselves.  

Follow up question is what if bob wants to pay an odd amount of months forward say 3 or 5.  Would it be okay to accept one full month prepayment with half of the following month going towards a credit??  

Hi All,

I have two tenants that have been with me for just over a year now.  Their lease is officially expired and they are going month to month.  They are nice enough fellas, but they are habitually late every month.  Out of 20 tenants I spend 90% of my time every month hassling these two guys.  Back in December they got behind by two months.  I agreed to waive the late fees just prior to Christmas to help them out.  

They were late in January.

I started clamping down in February and served them with an eviction notice in February.  They paid within the 3 days.  All along they keep explaining how one of the tenants has his share but the other is always behind.  I was advised not to accept partial payment and therefore do not accept any payment till the full amount is paid.

The tenant that's always behind asked if I would be willing to accept his half of the rent for the next 4 months when he receives his tax refund.  Something about inability to manage his funds.  

My attorney said I might could draft some form of agreement stating that I'm accepting x,xxx.00 from Bob for his half of the rent and Billy is responsible for the other half.  I mentioned my attorney said we could do something of the sorts and they both seem overly eager to do such a thing which raises red flags also.  

Just a PITA dealing with these guys.  Curious what others would do in a situation like this.  

Lose money : )...  Or do a 10-31 exchange if you are hell bent on making money.  

Thanks everyone for the responses.  Turns out after some more investigating my theory was correct.  Main line ran out through the front yard.  Was able to be resolved by replacing about 6' of pipe and installing a clean out.  Plumber also capped off the line going to the abandoned shed toilet and leveled out some improper grading around the house leftover from the remodel.  Total bill was $420.00  Seemed very fair to me and I'm back in business.

Good to know what to expect if/when we have a total failure.  Long term hold on these older properties and it's inevitable.