All Forum Posts by: Walter Pineda

PenFed, Quorum, TD Bank and US Bank, for starters.

Hi Walter, I am an out of state investor and have worked with multiple turnkey companies so feel free to reach out if you want to connect. 

Hi Walter,

Maureen McCann here, VP of Sales and Co-Founder of Spartan Invest. I wanted to take a moment to respond to your post. 

We agree that this situation was frustrating, to say the least! I'm so sorry you experienced this situation. Natalie was correct in her communications, though. We don't receive a reason or rhyme as to why Section 8 payments take longer to process. The Housing Authority certainly has its issues and we see that on the front end, which is why we simply don't advocate for Section 8. We are happy to facilitate the relationship on behalf of our investors if they should choose to accept those types of payments. The biggest reason for this is due to the loss in accountability that we are able to hold our tenants too.

The legal action that we're able to take if necessary is very effective in securing delinquent or late payments and you lose that with Section 8. We share your frustrations completely. Despite these challenges, we work hard to build relationships with the Jefferson and Tuscaloosa Housing Authorities so that we can better assist our investors. During this particular case with the Tuscaloosa Housing Authority, the staff was dealing with some turnover, and though our AR Coordinator and Director of PM Operations were both reaching out for updates, we were not provided with adequate information regarding this ledger. 

During our team's conversations, we were pushing this particular tenant to submit paperwork that would allow Section 8 to cover some utility fees in addition to rent. Government assistance is great but it is not without its issues and it is often all too slow! Again, I couldn't agree more with your assessment of the situation and the difficulty/frustration. I'm sorry you had to experience this but I'm glad our team was able to work with the Housing Authority on your behalf.

Everything that Drew said summed everything. I'm wondering if any Bootcamp will change that.
For me, I realized the better course is to buy a turnkey that does not have tenants, it was way better than having the unit occupied. If they just filled up the unit after rehab that's not a good sign for me. Or only buy in B-class neighborhoods.

Regarding inspection, Run at least two inspections ! Also when you buy in a buyer-beware state like Alabama there's not much you can do.

@Walter Pineda

The biggest challenges with Turnkey providers:

1) Terrible renovation work - we've taken over many properties that investor bought turnkey and they were shocked to learn the true condition of their property from our TakeOver video.
---So, get a GREAT property inspector NOT recommended by the turnkey company to avoid bias.

2) Misrepresenting Property Class - have seen many turnkey providers in Metro Detroit area sell OOS investors Class C properties as Class B.
---So, learn the neighborhoods where you plan to invest and use Google Streetview to virtually explore them.

3) Poor Tenant Screening - they typically can't sell a property until they place a tenant. So, they have a conflict of interest in waiting for the right tenant.
---So, insist on them providing the rental application and supporting docs for your review. This means YOU need to learn how to evaluate a rental application!

4) Poor Property Management - Where do you think a turnkey provider will put their best staff, on selling properties and making $5k+/transaction or on property management and making $80/month transactions?
---So, ask about their standard operating procedures and make sure your management contract has an easy termination clause.

What are your options if you experience one of the above? Everyone thinks they can sue to solve the problem.

Do you realize how much it will cost to hire an OOS attorney to sue the turnkey company?

Unfortunately, the majority of investors that experience terrible service from turnkey companies, figure out that it's not worth spending tens of thousands of dollars suing their turnkey provider and just move on - which allows the turnkey provider to not change their ways and stay in business:(

You should also check out this BP thread about the topic:

https://www.biggerpockets.com/forums/88/topics/976647-turnkey-company-suggestion?highlight_post=5648876&page=1#p5648876

Freaking out over an inspection report. I walked away from a property in Nashville in 2011 due to 5-10k in repairs, which I probably could have negotiated to get partially covered by the seller. We were under contract for $108k. That property sold last year for $460k. Hi, my name is Travis. I'm a moron. 

Hi! also try Redfin, Realtor.com. try typing the address into Zillow then select the sold tab, input the square feet and that should give you a better idea. I use Propstream but that's a subscription. Doing comps is challenging because there's a lot of variables. Good luck in your investment journey!