Extermination
I have just a handful of homes. As a service to the tenants does anyone pay for an exterminating company to go around and spray at their properties? Given some tenants are less than clean it seems this would head off some problems.
Thanks
are you opening yourself to a toxic tort is you preemptively do it.
"My baby had 3 eyes due to your spraying"..
Or what about a mix of buy and hold and some quick turning. If you can rehab and flip a house or 2 per year, this may provide the extra funds needed to fund some of your buy and hold part of the biz.
Even in a slow market this is possible, but you must buy the right houses cheap and then have the $$ lined up so you can afford to hold it until the sale.
New Kid...
Ok, great advice....1 per year for the next 10 would be ok.
But would I really have to put 20% down?
I have owned 3 homes myself....house #1, we put 3% down, house #2 we put 5% down....house #3 we put $1,500 down, and the sellers paid our closing costs.
20%???
Also....Even in my area....$50,000 is going to buy junk.... Lets use the number $60,000 as bottom of the barrel.
I am not a fixer upper kind of guy. I am looking at $70k properties where the work is done.
What happens when you go to get financing for rental #2??
Do they look at you are say..."Are you crazy?? you already have 2 mortgages with us." (my own home, and rental #1)..... or by showing that mortgage #2 is a rental that is primarily being paid off by a renter, does that relieve your debt/credit ratio enough to allow for rental #2 to be financed??
I purchased 5 properties within 4 months....I didnt have any problem with my lender. You just need to produce leases to justify the rental income and you should be good. Although this was two years ago and I purchased multi-units rather than SFR. I know lending standards are much tighter now, but as of 6 months ago I called my loan officer and he was ready, willing, and able to do yet another loan. Pretty much the same as the previous ones...low lender fees, very limited to no doc...etc. My wife and I also have A+ credit. Lots of luck to you.
NewKidInTown3 said If rental property #1 is "breakeven", then the debt to income ratio (for housing) has not changed.
Generally banks do not allow 80% DTI, let alone 100%. Break even means you are adding debt at the same rate as income. For instance, start at $3k/month income, with $1K/month debt. Ratio is 33%. Add in "breakeven" properties as identified above ($800 rent where you get $600 credit and $600 total cash debt.) The cumulative numbers are now $3600 total income and $1600 total debt. The ratio is 44%. Add in 10 houses and get to $9K income and $7K debt. Indeed the income difference is still $2K, but the ratio is much higher.
NewKidInTown3, I am not sure about Freddie Mac still being at 10. It may be. I have seen several different numbers (4, 6, now 9??) from mortgage companies and brokers. From http://www.rfnc.com/findmtge/invprop.html, they say under "Multiple Mortgages to the Same Borrower" If you are an active real estate investor, you may be limited by how many investment property loans you may have outstanding at the same time. Fannie Mae allows borrowers to have four financed properties outstanding at the same time, while Freddie Mac allows 6 (9 are allowed under certain conditions). Remember that properties owned with no mortgage are not included in this calculation..
Regardless, your point about getting a plan is the most valuable contribution in this thread... and I hope the original poster heeds your advice.
Quote:
On 2008-08-18 08:42, ITBInvestor wrote:
Freddie Mac allows 6 (9 are allowed under certain conditions).If you already have 9 financed properties, you can get a conforming loan to purchase your tenth property.
Once you have ten financed properties, you cannot get a conforming loan to purchase the next one unless it is your primary residence.
NewKid:
Want a job?
cj,
My current job pays $100K+ per year. My hours are noon to 1:00pm and I get an hour off for lunch.
Unless you can make me a better offer, then I have to say, "No thank you."
Dang..
Jeeze newkid. What kind of work do you do?
I was being facetious.
[ Edited by NewKidInTown3 on Date 08/24/2008 ]
a-HA!
They are NON-REFUNDABLE in NC. I tried to look up MD landlord/tenant law could not find anything referring to pet deposits. [ Edited by d_random on Date 08/27/2008 ]
Security deposits to include pet deposits in MD are refundable. You are allowed to charge any amount of pet deposit you wish, but the total of all deposits can not exceed two months rent.
http://www.oag.state.md.us/Consumer/landlords.htm#deposits
So much info...
We use a lease approved by AACo. Board of Realtors. It has a place for a pet deposit and if it is refundable or not. So..... assumption is yes, but go looking around. Plus, as you know, Baltimore writes there own rules...
I do have a Realtor friend in AA Co. who might help you out if you want. IF your places are all Balto or AA.
I make my deposits refundable (Md,Va,De) but make it very clear the additional items that a pet can impact that I will deduct for.
My son always makes his deposits non refundable. (Md/De)
In only one of my homes I also charged a pet rent of 25. per month. Now that I see what responsible pet owners they are (starting 3rd year w/me) I just blended the increase into 1 amount.
I like to reward my tenants for a spotless home, so I make mine refundable. I will charge without a blink of an eye for any pet hair left in the house or yard, any screen damage or window dirt or scratches, etc. OR system neglect (filters/fridge vents, etc)
Happy Reading and calling around ... share what you find if you do.
MC,
We also include "sorry, no section 8" in our ads.
And we use the term "pet fee" at lease signing plus a monthly "pet rent." We lifted these terms from short term vacation rentals at the beach.
Jim