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Archive for September, 2015

Exciting news on real estate tax dispute and other news

September 24th, 2015 at 09:51 pm

HI all

First hearings for my rentals start Oct 22. I have seen the comps and we have some good comps that really might slash my tax bills on these considerably PLUS.. where I live.. Naperville. the dispute period opens next month but in just perusing the assessor website myself I found a house 2 homes down with 700 MORE square feet w an assessed value more than $50k LESS than mine. Hoping to get major tax decreases through this appeals process. Dropping $50k off my assessed value has a $3500 impact.. and that is still 700 square feet more room than I have.

in other news..last unit filled w the rentals AND got 1 renewal at the 3 unit, pending 1 more and pending the new renewal lease on that one house

the existing property manager and I are under tense relations as more and more stuff, inattention, errors come out. double billing, missing credits for rent payments, charging me $2500 last month for 'repairs' I was not aware of and am disputing.. and he is struggling to substantiate and now trying to settle w me for a lower amount. may have to get an attorney involved... also these renewals should occur BEFORE the lease term ends. just on and on . anyway.. one more month w him and then hopefully improves and really one of the key areas was repairs (not knowing about them, price gouging, inability to trust the repair was actually done not just made up etc etc). New property manager gets my approval BEFORE starting work and gets an estimate up front and takes PICTURES! and I can talk to the repair people if I want

again I looked through my notes. this did NOT occur w this properrty manager upfront. just got progressively worse..

Both tenants we moved in want to stay a long time and have friends/ family in area by the way.. hard to get cheaper fixeed up homes then the ones I have so may hang on to these.

So have a lot of people wanting to stay in these 'hard to rent homes' and have only 1 house that may makes sense to sell right now and investigating doing so. apparently per realtor and new property manager though, there are people starting to buy up to live in this area so area may be going up.

Totals are in. I raised rents $306/per month this year but vacancy (evicting 2 from the 3 units, and 2 slow to rent homes ) has me way over my vacancy budget and all these unexplained repairs and what feels like price gouging has me over my repair budget. The rehab I managed myself was over $2k less to do MOMRE work than through the property manager and I hired actual tradespeople not folks off the street

upsetting news-refinance declined

September 24th, 2015 at 04:15 pm

Upsetting news today. Refinance declined. My original loan officer was let go and left the company. He also left the file in disarray apparently and they submitted it for the wrong loan type. I should have been submitted for Fannie Mae.. anyway.. waste of time and money (appraisal, credit report)... very upsetting. and they do not with to resubmit as they do not 'own the loan'.. guy who left the company does so it poses problems. Maybe that was why service was so bad after he left.

Crazy.. anyway. re-starting trying to get a Fannie Mae refinance. i was approved last year (except had to wait 1 more year per their waiting periods).

Goal rate is 3.25 and this guy is speaking w underwriters up front .. a Fannie Mae one! he can use my appraisal if we act fast.. they expire after 90 days

I am on a 5/1 arm right now at 5.75


updates, opened an HSA and new strategy w rentals

September 21st, 2015 at 01:44 pm

Hi all

I opened an HSA with Health Savings Administrators or Flat rate of $45 a year. There was one other one that might have been less cost dependent on how you invest, how much you had in there etc. this was $45 flat and had good Vanguard funds so felt like the easier choice.

Plan is to use this sortof like a 401k and NOT withdraw from it (unless some dire medical emergency) until retirement. This is one I set up individually not through where I work so money put is in AFTER tax but should; be tax deductible. Limit is $3350 this year. Will try to fund this , the 401k and the Roth every year. Trying! I put $50 in it to start the account.

Trying to be financially free in 5 years is exhausting stressful work!.. less than 3 years left.

that rental house is filled. the other house is almost filled. still confirming things (manager is slow)..

New strategy w rentals. I am going to get some outside opinions , use the web and get selling price estimates across the 6 homes so I have a good market value and look to 'swap' some out that and increase the quality of the neighborhood and therefor maybe lower my costs, not be so stressed with management etc etc.. . Step 1.. get market values this week ( I will get the 3 units value even though I can not sell that right now and really do not want too. rents easily, good area, great cash flow but realistically long term mayeb I would want small homes vs apts.. we will see... be interesting to see what folks think it will bring). 2. decide which to sell.. 3. I was going to take a stab at selling at least one via investor contacts and Craigs list (yes, really) have had friends sell them like that. why not me? 3. get a pulse of the market and homes and prices to see what I can buy w the cash 4. run my thoughts by some advisors for thoughts about selling at all, sell now or later. 5. get the new managers thoughts on ease of renting these homes. really we have only had issues with one home..

I may lose some cash flow upfront if I do this.. but steady returns and simpler may be preferred and cash flow will come as it is easier to raise rents on a more highly desirable area.

I can not be 'financially free' when I am stressed w the rentals anyway..

I did go for lower quality areas to 'get in' and do not regret it .. easier to get in.. much more cash I have somethign to swap... but is that where I want to stay??.. I am not thinking so. I have options now to 'swap' out of them and I think I may take that opportunity.

Anyway. just thoughts right now. got to get some facts, do some research and think on it. no more fast decisions over here!


updates and HSA question

September 15th, 2015 at 11:00 pm

hi there.

Updates. I think we have that 'harder to rent' house filled with a tenant I like. Manager is setting up a lease appointment. She has family in the area and wants to stay long. Fingers crossed.

House we rehabbed. we have someone lined up for that as well but she wants to move in on the 1st. We will do final checks and then sign the lease w her.

New manager starts 11/2. Excited.

Renewals notices are out for that one house..and one apartment. should have news this week

I am thinking of doing an HSA as another tax savings retirement vehicle. Any thoughts of where to put that. looks very good and has a $45 flat fee each year. $3350 per year limit

Still trying to max out the 401k. got $3200 left to fund.

Thoughts welcomed.


ON the 2nd round w the refinance underwriter.. got another 'condition letter' w items I have to fulfill. Will work on that tomorrow and hopefully close it next week.

I will NOT fully pay myself back this month. I had hoped too but looking like I may end up short.

Project Manager update

September 11th, 2015 at 09:08 pm

HI all

thanks for the feedback on the property manager issue. here is where we ended up

1. Current PM will terminate 11/2/15. Rents for November will go to new PM. I need to send the new PM an updated contract to sign. he did sign the one calling for him to take over as of 10/1
2. Current PM will keep the vacant homes until that time. The one I am rehabbing is done and BEAUTIFUL. he has showings tomorrow and one person we took an app from who wants to move in who has family in the area and is likely long term, Other vacant house, he has showings tomorrow and had a good one yesterday. Fingers crossed. we went over what he is doing and the only thing I can add is to put it on the list at Section 8 whch he should have done already.

Meanwhile we have 1 house and 1 unit coming up for renewal. Both look good but he did not send renewals out yet (hello??) but claims to have talked to the house and they want to stay another year. He has not called the unit yet but send out the notice today. He will have updates next week.

All rents in except vacant homes

Paying off the 6 homes makes a MAJOR difference in the cash flow across the homes and my own budget. I had a mortgage of approx $5500..

I am still however catching up after paying my part of paying off the 6 homes so super tight this month making my savings goals.

Work hours are slightly down w the holiday and took a day off here and there. I should average 48-50 again as of next week

I have had contact with the office of the new property manager and they are very professional etc.. organzied really excited. AND they are 2% less.. over $2k a year difference and will work w my contractor.

For this 'hard to rent ' home. the new property manager did not feel it should take 3 months and talked to some folks who felt the same way 'unsure why it is taking so long'... Regardless, IF this house IS this hard to rent, I will look into selling it and others on that street and buying easier to rent homes/units with the money.

Calm and continual cash flow is my goal

I will hear on my tax dispute in November across the rentals. Hoping for a $625 decrease each month in taxes but have no experience or facts to base that estimate off of

Still trying to reach $8000 stable monthly cash flow by 6/18

Did second submittal for refinance on main house. should hear next week. (had to submit a bunch more docs)


Property Manager issue-seeking thoughts

September 9th, 2015 at 01:47 pm

Hi all

My property manager contract calls for a 60 day cancellation notice. I talked to the current PM yesterday and he was saying he will hold me to that and in general not very nice. He also has the house he has had vacant for 3 months. He says 'no one is going to rent is faster'. The seller (65+ year old owner rented it before on his own). We are hitting the slow renter season and I do not want that particular hosue waiting 60 days to turn over when I know this other guy can rent it faster.. and/or to a better client

The current PM says he has 5 showings set this week. betweeen Thursday and Saturday. I told him we will talk later in the week so I could figure something out and get ideas from folks. I feel like changing the locks or doing something 'forcible' but then he has all the other homes.

Any suggestions?

he makes nothing on the house right now and is likely just being an *****.I can not afford to have bad property management causing me months of rent. but can not afford to have him mess up the rest of the homes too.

Diarying.. property manager switch and LOTS of stuff

September 8th, 2015 at 02:36 pm

HI all

Diarying. been feeling a little 'unfocused lately'.

In a relationship and wondering if we are compatible or going anywhere.He does not express himself as wel as I would like w words.


1. 6 homes bought! took more money than I had thought and had to rehab that one house. already paid back my emergency fund.. got to put $3500 back in the personal emergency fund
2. now that I OWN these I feel a little more serious and long term. Anyway. I gave notice to my old property manager .. he still has that 1 house sitting and 1 house I had to manage the rehab (which was not so bad as i learned and got it done how I wanted and for 2k less )but he did not assist with meeting people, reviewing the work etc. . Anyway I gave him 30 days notice. He says the contract calls for 60 days. I called him this morning and his VM was full (not an unusual occurrence).I am going to ask he release the homes in 30 days and that 1 vacant home immediately. I will update.
3. Put my first $1750 into the 3 units payoff fund. Looking to pay those off 6/2018 and need $69k

Basically switching property managers as the one I have (though better than the one I switched from who ran the 3 units)
1. he is overwhelmed and is a 1 man show, he has 2-3 times voiced concerns he may 'quit this' if things do not improve. VM Full often and several times got complaints from tenants he did not call them back. Not organized. reports late or not submitted at all. Still waiting for July, August reports and laundry $ from 2 months ago. Does not renew leases on time.. Having to remind him of things all the time
2. Does not have a good relationship w section 8
3. Slow to rent . Slow to rehab. It should be noted this was NOT how it was when I started w this guy. Maybe he is more overwhelmed??
4. I do not trust his repair people and he will specifically not let me speak w them.

In contrast the new guy has an online software system that allows me access to see rents as they come in, run reports, has leases etfc uploaded and has all communications w tenants noted, has an office with staff and have 9-10 people on staff. They personally take emergency calls 24-7. All calls are logged. I met the repair people and I am free to talk to themm on repairs if I want AND they talk to me upfront about all repairs with a PRICE for my approval. Plus I can use my own contractors which they will manage. Monies go out automaticaly on certain dates, late notices go out on certain dates, they have a very good relationship w section 8,. they enforce the leases and have a guarantee . if they have to evict they will refund my 'placement fee' and they are 2% less per month..

Also with the current property manager, repairs costs were high and it appeared he was 'fixiing something' every month. I recall it being 'curious' that when I did hte switch the last time the need for repairs stopped and how mmuch can need fixing in a house. these are small 1000 square feet homes? It made me feel repairs were 'made up' and added to the bill .

Again this was not how it started w that guy.

So concerns w the first guy were
1. ability to rent
2. communication
3. repairs
4. reports

It appears I wil have improvement in all of those. I need these homes STABLE.

Started an eating and working out plan . want to lose 20# in these next 8-10 weeks. gained weight getting my primary residence back from the bank and then again recently.

and looking to find ways to be more relaxed, less stressed and have more thing I enjoy

Really if I can hang on this job (or a similar job) an get these properties under control I just need to follow my monthly goals and I will reach my June 2018 main goals.

Primary home refinance still in progress. LOTS more docs this year.

And got reassigned at work to the largest account they have.. with a project that will go past 1/16/16 so feeling like if I lead this project is pretty much guarantees my renewal for another year or at least 6 months. I will ask for that in November