First Deal Just Killed!
the first deal was just killed because of lead paint. I checked with the Health Department just before closing and come to find out the whole house needs to be renovated completely. the outside inside basment and all windows need to be replaced. (about 30,000 +). i guess i will have to get back out and try again huh?
how did this happen?did you buy it fix it up and tryed to sell it?
Well, if there was something like that wrong with the house, aren't you GLAD you found it BEFORE you closed!?!?!
Wait a minute!
Most of the old houses we deal with (pre 1978) will have lead-based paint (LBP) in them. Learn to deal with it now and save that property.
First off, LBP is handled differently in different jurisdictions. The Health Dept. is certainly not the place to go. They're liable to tell you anything, but property rehab is not their purview, nor can they require you to go replace windows or do LBP abatements. I'd be real curious to know if your Health Dept. is flexing some kind of muscle there. I think you just walked into the wrong bureacracy and walked out with their brand of bureau-speak.
Second, realize that LBP comes into play when using HUD money and when using sect. 8 tenants ('cause that's HUD again). There may be other municipal regulations, too but mostly they'll relate back to HUD. HUD has done the Big-Daddy work on LBP.
Presence of LBP doesn't mean automatic abatement, either. All that's required by HUD is that LBP be contained, i.e. stabilized and encapsulated. In other words, painted, carpeted, etc.
But not just any old paint job. You should have the painters use "lead safe work practices," i.e. respirators, plastic sheets, dust containment, HEPA filiters on shopvacs. No real big deal, really. This is easily learned by downloadable manuals at the HUD website. Your painters need to learn this stuff anyway.
Third, nobody's going to monitor your rehab (unless your using some City rehab program, which, again is HUD money, but with local people poking at you.) But, you want to learn to responsibly handle LBP issues anyway because you don't want to incur liability, AND because you never want to see a child poisoned!!!
But don't let LBP scare you automatically.
Fourth, after all your work is done and you have cleaned the place you get an LBP "clearance test" done by a local environmental lab for about $250. You must pass this clearance to get your HUD tenants. This clearance is pretty good; they check the window sills and floors for minute particles of lead dust. They do a few tests in every room.
You can jump through these hoops without a whole lot of headache once you've got the routine, and the upside is you have an LBP cleared property that is good for tenants, covers you rear-end, and is HUD approved.
yes hes right on!! Just make sure there is no chipping paint anywhere. the health ,department.Most of the time they like to scare people or think they have all this power but the dont unless your dealing with hud .Did they come in and give you an inspection? The health dep is all cock and no balls..lol dont loose the property.
[ Edited by jgodfrey on Date 08/13/2004 ][ Edited by jgodfrey on Date 08/13/2004 ]
hi, thanks for your responses. okay i went to the health dept. becasue even the street card on the prop. said the prop contained LBP. 4 years ago in 2000 a child was poisoned from it in this house and the health dept got involved. i know it can be painted with special paint. the prob is, is that the paint in 40.00 per gallon and the house it 3 story and 3300 SF. the Health dept ahs inspected it and has a step by step diagram of what needs to be done to this house. the inside outsite basement stairs walls etc. they said it would be a lot of work. thanks Ryan
sounds to me like the offer needs to be decreased...
sounds to me like i need to sell the contract for 2 grand..that sounds appealing to me becasue i dont have the capital to put into a prop. like this..thanks
Quote:
On 2004-08-13 11:47, rmdane2000 wrote:
sounds to me like the offer needs to be decreased...
I agree. You shouldn't be worried about paying for this. The seller should be paying, but flipping to a contractor is a good option too. I know I wouldn't want to take on that project
there are to many deals to stick your self with a headache. it can be done but do you want to when you can find a good deal without these problems......kenmax
yes i dont want to get myself into to much but this deal has a prfot margin of 100k +. we will see how it goes
INH,
I am SO far from being an expert, but are you seriously telling me that you are going to flip a contract with $100K in profit for $2000?
I'm in Chicago. We have lots of lead based paint issues here, like most places. I *think* THINK that even Section 8 only requires "sealing" in the paint so that kids can't eat the chips. I don't remember any $40/g paint either. Just normal paint.
I would super-duper verify this before I walk away.
I know CT could be different, but are you sure the guy you talk to there wasn't an investor?! LOL!
yes im sure she wasnt an investor. the health dept specifically told me that the paint was about 40-60 $ per gallon. i guess it is rubber sealing paint or something.. not really sure, im no painting expert. and yes this is a 100+ deal thats why ive been up all week trying to figure this out. the house is a 3200 SF 2 family that i could get for 70K and could easily sell it for 175-200 ofter being painted and land scaped a little bit. when i talked to my lawyer he said the lead paint was a really big deal and to inspect it very well before i get myself into anything. thanks for your replys, Ryan
INH, I understand your frustration but LBP is a given if built before a certain year. Treat this like a rehab deal in that you get all your repair estimates, finance the deal, fix then flip. Or partner w/a rehabber & split the profits. You worked too hard to walk away. MAKE IT WORK!!! That's what creative investors do. You can do it. Don't give up!
i am going to try as hard as i can and i really hope i can do something. thanks, Ryan
i am going to try as hard as i can and i really hope i can do something. thanks, Ryan
Hi,
Check with the local health department ragarding Moderate Risk Deleading procedures, in Mass. an owner/agent can attend a 6 hr course outlining the proper procedures for bringing a property into lead paint compliance/deleading. This course costs 175.00 and is conveniently held on weekends.
Encapsulation paint needs to be carefully applied and the surface needs to be prepared correctly, the paint is usually more expensive than ordinary latex paint.
Check out http://www.fiberlock.com
yeah, we have talked to the health dep. about it, and we just are not interested in putting that much time and money into the place, so we are currently going to sell the house to a rehabber for 105,000 we will do a double closing on it, and move on to the next deal. so this deal has been saved after all. thank you every one for your comments and info on lead paint. Jeb