Help! Need Advice On My Property In Far Rockaway, Queens
I’m a traditional real estate investor (buy and rent out my properties) and I’m looking to get out of this aspect of real estate and get into either wholesaling or short sales. Here’s my dilemma:
I purchased a new-construction 2-family home in Far Rockaway, Queens, NYC. I closed on the house on May 3 of this year.
My mortgage balance is a total of $474,200 and I’m paying $3,768 per month on it (very high 2nd mortgage interest rate). I’m receiving $2,850 in rental income from both units, which means I’m paying $918 out of my pocket every month, which means I’m losing money. Also note that I have to also pay the quarterly water bill and pay the 2nd floor tenants’ natural gas bill (because they are under a government program, by law, I have to pay this service). I have 5 months worth of reserves to pay this difference ($918 x 5 = $4,590).
The tenants moved into the units in May and June and now I want to sell the home. I can’t refinance because I have a 1-family property that’s on the verge of foreclosure (September will be the 2nd month I haven’t paid the mortgage) and I’m sure my credit score is lowering each day because of this. And I’m going through the eviction process with the tenants there because they haven’t paid the rent after I told them I wanted to sell this house….LONG STORY on that one too.
Back to the 2-family. I want to sell this house to another investor. I think that I’ll give my tenants 90-day notice instead of the standard 30-day because they’ve been great (plus, the wives in each apartment are currently pregnant and want to give them enough time). The mortgage balance is $474,200 and I’m willing to sell the house for this price. Yes, I’ve lost some money on it, but I’m willing to break even just to get out of this problem. The house was appraised in February for $550,000, so there’s some equity.
Please advise as to what I should do. I’d appreciate any advice or assistance you can provide.
Thanks.
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