Chat 10/24/05
Posted on October 24, 2005
Chas: Hi, I’m new to this gig. Are you all the rental experts?
Ralph_Roberts: hi roger
Ralph_Roberts: Hi ritchie
Roger_Dawson: Hi Ralph! Am I in the right chat? This looks like last
week.
ritchie: Hi Ralph, Hi everyone
Al_Lee: Hi, Roger.
Ralph_Roberts: hey Al!
Roger_Dawson: Hi Ritchie. Hi Al
Al_Lee: Hi, Ralph.
Al_Lee: Hi, ritchie
Ralph_Roberts: must be, Roger… Al’s here
ritchie: Hi Roger
Al_Lee: Ralph, that’s right. You can begin now.
Bob_Carr: Hi Everyone
Al_Lee: Hey, Bob
Ralph_Roberts: okay, Al… thanks 
… hi bob
Al_Lee: I often wonder what peopel look like in these chatrooms, but I
won;t wonder long in your case, Bob.
Roger_Dawson: I spent last week in Asheville, visiting with Webmaster
Ralph and inspecting some of Mike’s properties. Weather was beautiful. Now I’m
back in LA where it’s raining constantly.
Ralph_Roberts: presenting Roger Dawson … ask questions
Bob_Carr: Hi Al,Ralph
Ralph_Roberts: roger, weather is no longer nice… cold, supposed to get
snow flurries
Ralph_Roberts: really
gabi: Hi everybody, hi Roger
Bob_Carr: That could be scary Al
Al_Lee: I’ll brace myself!
Mike_Summey: Hi Everyone
Ralph_Roberts: hi gabi
ritchie: Hi Mike
Ralph_Roberts: hi Mike
Roger_Dawson: There was an article in Fortune when a big RE investor
alikened today’s real estate market to playing polo with a a bunch of beginners.
Bob_Carr: Roger you looked at 600 properties
gabi: Roger - I’ve been listening to your Power Negotiating cd’s all
weekend. They are great
gabi: Hi Ralph
Ralph_Roberts: Mike Summey’s in the house
Ralph_Roberts: summey
Ralph_Roberts: him
Roger_Dawson: Said that sombodies going to get hurt out there.
gabi: Hi Al, how are things?
Al_Lee: Hi, gabi. How are you?
gabi: Hi Mike
Roger_Dawson: Thanks Gabi! Help me spread the word!
gabi: Al - I’m well thanks.
MarkNC: Hi everyone
Mike_Summey: I just wrote an article of the creia group that I will be
speaking to next month.
gabi: Roger - Yes I will. Do you do a series just for real estate
negotiations?
Roger_Dawson: Gabi, we’re planning a Weekend Millionaire book on
negotiating but it won’t be out until next fall.
Mike_Summey: gabi, Roger has made me millions, but don’t let him know
that…he’ll was a commission.
ritchie: Mike, any news on the Nov. 19th seminar?
Mike_Summey: ritchie, it’s on the website calander.
MarkNC: Is that in Asheville Mike? (The seminar that is)
gabi: Roger - I’ll be looking forward to it being released. There are so
many variations in how to set up a deal that everybody can live with and as you
say win.
Mike_Summey: Mark, yes! It will be held at the AB Tech Ferguson
Auditorium
ritchie: Roger, I read the fortune article as well. Everytime I read
about the “bubble”, I get nervous
Al_Lee: Roger, I met with a man thsi week about funding the marketing for
an invention of mine and I am asking form many milions. Before I went, I
reviewed your Power Negotiating book. Really valuable stuff in there!
MarkNC: Great, maybe I’ll male the trip down.
Roger_Dawson: Thanks Al. Good luck with your invention.
Mike_Summey: ritchie, the article I worte tonight is about the bubble and
how it’s bursting will be good for Weekend Millionaire investors.
ritchie: Mike, how can I get that article?
Mike_Summey: ritchie, what’s your email address?
ritchie: rschacher@nc.rr.com
Mike_Summey: Hi Penny
Roger_Dawson: Hi Penny!
Penny: Hi Mike & Roger
Penny: Hello everyone
Bob_Carr: Mike that’s not fair
Mike_Summey: What Bob?
MarkNC: Mike, how is your mother doing?
Al_Lee: Mike, if you send me a copy of it, I will shamelessly steal it
and present it on air as my original thoughts.
Mike_Summey: Hi Dave
Bob_Carr: Just kidding
gabi: Roger - after listening to your cd’s I realized, that with the
house I was looking at I probably could have gotten a deal if I had spoken with
the owners and had them look at the large repair bill. They probably would have
lowered the price thenmselves right there.
gabi: Hi Penny
Penny: Hi gabi
Mike_Summey: Anyone who wants the article give me you email address!
DaveNRichmond: Hi mike. hope your mom’s doing well.
Roger_Dawson: Gabi, one of the seven keys to credibility is to show it to
them in writing, it’s so much more believable.
DaveNRichmond: you want us to email it to you?
Mike_Summey: Mom came through the surgery remarkably well. the doctor
feels that he got all of the cancer, so the prospects are good.
Al_Lee: Mike, you already have my address, but it’s al@RentHouses.org if
you don;t want to look it up. I’d love to have that article.
MarkNC: Mike, I’ll take a copy, ginnmc@appstate.edu
Ralph_Roberts: that’s good, Mike!
DaveNRichmond: dpvital@hotmail.com
DaveNRichmond: I picked up “mindset” this week.
gabi: Mike - hope your mother will be recovering quickly.
DaveNRichmond: I needed some motivation
Mike_Summey: Dave, I think you will find it to be motivating.
Roger_Dawson: DaveN it’s great motivation! When you read Mike’s poor
beginnings story, we don’t have any excuses at all.
DaveNRichmond: Hey mike and Roger. how many copies of your first two
books have you guys sold
Al_Lee: Yes, Mike. I hope your mother recovers quickly for mthe surgery.
DaveNRichmond: Things have been dragging for me here so I was getting
frustrated.
Roger_Dawson: DaveN I think we’re at around 150,000 right now, which is a
lot!
Mike_Summey: anyone else who wants the article I wrote about the
“Bubble” for the group I’m speaking to next month, give me your email
address. I have an email getting ready to go out.
DaveNRichmond: What’s really astounding is that so few people ever come
to the chats
Mike_Summey: Hi Sandy
DaveNRichmond: I missed a lot of them this summer because Iwas renovating
a house but I always read the transcripts.
gabi: Roger - question about rent raising. I’d like to raise the rent on
my rental about $150. $75 each side of a duplex. Also the pop manager recommened
to add in the Water/sewer/garbage wich would add another 150. The tenant totally
flipped and said no way would be sign a new lease. What do I do?
Mike_Summey: Dave, that’s why so few people ever achieve success.
Bob_Carr: Mike mine is Bob@Tlcincorporated.com
Sandy: Hi
Larry: lwcwilli@bellsouth.net
Mike_Summey: Hi OZ
DaveNRichmond: Hey Al, do you do Lease to own?
Bob_Carr: Dave - Most people never read further than the first chapter
Mike_Summey: Ralph, can you put the article on the website if I send it
to you?
Ralph_Roberts: yep
Al_Lee: gabi, if the agent won;t present the repair estimate to the
seller, you can force it by countering at the seller’s price if they will cure
the discrepancies by accomplishing the work itemized on the attached estimate.
Then the estimate becomes part of your offer and must be presented to the
seller.
Roger_Dawson: Gabi, it’s a good idea to send tenants (during the course
of the year) anything that relates to increased expenses such as interest rates,
taxes, insurance etc. Clip it out and let them read it so that they see the
problems you’re faced with.
Penny: Mike tell Gabi about the nusance raise in rent of 10.00/mth you
suggest.
Sandy: Sandy: email is sldarcy@cwnet.com
Oz: Hi Mike
Al_Lee: Dave, I do not lese to own becaue I do not want to sell.
DaveNRichmond: The place I renovated has been onthe market for a month
and my parter and I are thinking of going lease purchase with it. I think he
would prefer holding it and renting
Ralph_Roberts: My renter told me that he lived in the same house for 10
years. When I checked, I found out he’d still be there today if the Governor
hadn’t pardoned him.
Roger_Dawson: Gabi at this stage, you might suggest that you’ll hold off
on the second increase for as many months as you can.
Penny: good one Ralph
Ralph_Roberts: thanks, Penny
Al_Lee: Dave, if it will lease at a positive cash flow, why woudl you
sell it? If it won’t, why would you buy it?
MarkNC: So with what I see as the impending rise in construction costs
with all of the hurricane reconstruction and all of this bubble talk, it
occurred to me the other day that now might be a better time to look at
improvements to existing properties and maybe not as aggressively looking to
buy. Any thoughts?
DaveNRichmond: Well our plan was to renovate and flip for some working
capital but it took longer to fix up that we thought and we ended up just
getting it on the market a month ago.
Roger_Dawson: I’ve never leased property, only rented month to month. I
figure leases only protect the tenant.
gabi: Al - good idea. Because the agent told us that the repairs were
minor and not the $25K that the builder who would be doing the work estimated it
would cost.
ritchie: Dave, if you rent it, and have equity in the property, can you
borrow against the equity to get working capital?
Mike_Summey: gabi, the best way to keep rents in line is to raise them a
little each year rather than waiting several years and then hitting them with a
big increase. Also, I have a surcharge over and above the rent when I have to
pay water, sewer, garbage, etc. I can adjust the surcharge during the lease if
prices rise.
Al_Lee: gabi, of couse a real estate agent would know more about repair
costs than a builder, right ???
ritchie: Roger, don’t the banks prefer to see 1 year leases?
shane: Just rented out my last two apartments on a deal that I closed two
weeks ago.
Roger_Dawson: Mike, can you answer Ritchie’s question? I don’t know.
Mike_Summey: ritchie, banks don’t usually look at residential leases when
considering credit.
DaveNRichmond: paid 86 for the property. spent 20 grand fixing up. should
sell for about 139. could only get a loan for about 105 or so
gabi: Al - they just want to hook you with a deal those agents. When
looking closer you realize you are being had.
DaveNRichmond: it would probly just break even…..if we intended to rent
I wouldnt’ have done so much to fix it up. would have repaired and spruced, not
a complete ground up renovation.
Mike_Summey: Hi Kim
Sandy: I’m with Dave. Somewhat frustrated and demoralized. In spite of
all the “No money down”, I am finding it hard to jump in. All the real
estate clubs are offering tons of properties, but neg. cash flow. (They are
after the appreciation.) It just seems I don’t have enough money to make a good
buy. I can’t really determine what I need as the only exposure I’m getting are
these tons of Investor club properties. I live in LA area, so am not even
looking in the neighborhood. I’m not sure what to do except keeping studying.
And my job will NOT improve in order to save more. Any suggestions?
Kim-OH: Hi Mike!!!
Mike_Summey: Sandy, did you give me your email address?
Mike_Summey: Yes you did
Mike_Summey: Hi Bryant
Al_Lee: A wise man once told me that some people think real estate agents
work for the seller, other people think they weork fo rthe buyer. he said the
truth is they work for themselves. They just want a commission.
ritchie: Dave, can you define what a ground up renovation is? For only
20,000?
gabi: Mike - the prop. manager told us that the rents we are getting are
too low. Therefore we thought we’d increase it per unit to bring them up to
market value. I think the renter isn’t understanding that the large increase
also now includes the WSG bill.
DaveNRichmond: We bought another place since then that will be ready for
a renter by Nov 1st. I’m putting the ad in the paper this weekend. That one will
break even
Bryant: Hi Mike and all
Mike_Summey: gabi, that’s where you have to do an education job.
gabi: Mike - what do you mean?
Roger_Dawson: Sandy, I don’t think there are many no money down deals
that will cash flow in Los Angeles. It’s just too hot a market right now.
Sandy: Mike, yes: Here it is again: sldarcy@cwnet.com. (I do have your
audios which have been my best resource so far.)
Kim-OH: Hiya Ralph, how are you tonight?
Mike_Summey: gabi, you have to explain to the tenants why you want the
large increase. No tenant wants any increase, but when you can explain why it is
necessary they understand better.
DaveNRichmond: Ritchie, I put vinyl siding on it, replaced all windows
with energy efficient vinyl. Three new energy efficient doors, gutted bathroom,
sanded and coated the floors. new kitchen floor, hired a painter who did a
spectacular job. built a closet in a deadspace in the wall. new cieling fans,
painted the foundation. tore out a pool (above ground) that had collapsed in the
backyard 10 years ago and created a sitting garden, landscaped…….
ritchie: Sandy, if you can’t get cash flow, the investment is not worth
it.
Mike_Summey: Anyone else want the artice I wrote today? If so you better
send me your email address now as I’m about ready to send it.
gabi: Mike - yes , I hope that the prop manager explained it properly.
What kind of a surcharge are you talking about in your rentals?
Penny: Yes, sorry, just forgot how to return private IM
ritchie: Sandy, you probably need to try other methods for getting leads
besides from investment clubs.
Kim-OH: Mike, I want it and you have my email addy if you are sending it
to the list
ritchie: Have you read Mike’s book?
Kim-OH: Hi Penny
Sandy: Roger…..that is true. Perhaps buying is not the place to hop in.
Finding properties for others? I’d get on a plane and go searching, but that
would eat up what money I do have. These investor clubs keep showing property
with $125,000) etc. I get excited, but so do the other 400 people in the room.
DaveNRichmond: I did almost all the work myself so that’s 20 grand in
materials
ritchie: Dave, sounds like a lot for just 20K. Did you do the work
yourself?
shane: yes I do, coverall@netburner.net
Mike_Summey: Sandy, that’s what the article I’m going to send you talks
about.
gabi: Mike - I called the city to get an estimate of what the WSG bill
amounts to and these tenants keep paying late, therefore I thought we’d a dd it
into the rent to ensure to get it paid. Do you think that’s a good idea?
Penny: Hi Kim how are you feeling these days?
Al_Lee: Sandy, go to www.TurnkeyInvestments.net and see what you find
there. I think you will be sruprised.
DaveNRichmond: I did the work myself because we had a budget of 100k. I
put the extra 6 grand on my card.
gabi: Kim - long time no see. How are you?
Kim-OH: Penny, I’m doing ok considering everything lol and how are you
doing?
Al_Lee: Hi, Kim
Sandy: Ritchie, if you’re talking to me, I have the audio set which I am
working on. (The workbook).
DaveNRichmond: in the future I will have others do the work for me.
getting started is the thing.
Kim-OH: gabi, I know its been a long time, how are you doing?
Kim-OH: Al, how’s your wife doing?
ritchie: Dave, are you doing this full time?
Mike_Summey: Hi DC
DaveNRichmond: Al, you only have properties in texas, correct?
Sandy: Thanks Mike. I just need to find a viable starting point.
Al_Lee: Kim, she is at 95% and improving daily. It just take stime to get
all yoru energy back, but she is getting there.
DaveNRichmond: no…..I was working my day job, and then working on the
house till 11 at night and all day sat and sunday.
Mike_Summey: gabi, I like to keep the utility surcharge separate so I can
adjust it during the lease.
DC: How do any of you fill vacancies
Kim-OH: Dave, it’s good to do a few rehabs and get a feel for them, then
you know how things should be done and how much they should cost
Penny: Kim I’m doing okay. thank-YOu
Al_Lee: Dave, I have residential properties only in Texas, i have some
commercial properties outside Texas
Kim-OH: Al, that sounds about right and I’m so glad to hear that she is
doing so well
Sandy: Thanks Al. I found your site before this one, and wanted to join,
but do not have a plan yet, so have not committed to anything.
Roger_Dawson: DC, we recommend using a property manager. They know the
market and they know how to screen tenants.
DaveNRichmond: I’m offering this rental that’s just about ready to
welcome section 8. It’ll be an experiece, I’m sure
shane: Dc ,I like word of mouth from the other tenents
gabi: Kim- I’m doing well. My son broke his collar bone in a soccer game,
but he’s mending nicely. Otherwise things are good.
Sandy: Shane….are you the Shane in LB, Calif.?
Kim-OH: gabi, it seems that children and broken bones are a match made in
heaven
Mike_Summey: Hi malpaso
DC: Thanks roger I havemy first proprty almost still gotta close I just
wanna manage it myself to see how it goes
malpaso2001: evening Mike
Al_Lee: Sandy, don’t buy anything unless it will cash flow positive. You
don;t want to be a speculator. you want to be an investor. An investor looks for
income. If appreciation also happens, that is gravy.
gabi: Kim - Yes, seems that way
Roger_Dawson: DE
Kim-OH: gabi, I had a broken collar bone from a car accident, it will
mend
shane: No, Just good ol Ky
Kim-OH: shane, where in KY?
DaveNRichmond: Well the biggest thing I learned from the whole rehab
thing is that mike is right. Get other’s to do the work.
Mike_Summey: Everyone who gave me their email address should have the
article now.
DC: Al Lee do you like single residences or multi units???
DaveNRichmond: soon as I can, I’m having others manage my properties too.
MarkNC: Thanks Mike
gabi: Kim - the doctor said it’s a very quick healing process and he’ll
be abele to paly basketball when the season gets here
Al_Lee: Sandy, most people get mesmerized by the apprecaition and don;t
realize that there is actually more money to be made long-term in the cash flow.
Kim-OH: Mike, did you send the article to your email list?
gabi: Kim - sorry, able to play
Al_Lee: DC, I prefer singles most of the time, but will buy duplexes or
even 4-plexes if the price is right.
Mike_Summey: Kim, NO. I sent it to Ralph to put on the website.
Sandy: Al….I exactly remember that….Both Mike, Roger, and Rich Dad. I
can’t figure out why these Investor Club members buy so quickly without any due
diligence. Makes me feel like a scaredy cat.
Kim-OH: gabi, that’s most excellent
shane: Eastern Ky, but I have rentals in Lex. Ky. And lived in cin Oh
when I was little
Ralph_Roberts: and I’ll have it up soon, Kim
Kim-OH: Mike, oops should have given you my email addy again then grrr
DaveNRichmond: Al why do you prefer SFH over Duplex? I would think the
profit margin is better with multi’s
DC: Hey AlLee What got you into real estate??
Kim-OH: Ralph, thanks a bunch
Al_Lee: Another wise man said he has never lost money on a property he
didn’t buy. It is OK to be a little bit of a scaredy cat, but you do need to act
some time.
Sandy: Hasn’t come yet. I must have slow email.
Kim-OH: shane, where in Cincy?
ritchie: Mike, I didn’t receive the article. rschacher@nc.rr.com
shane: Miamitown. I was in Franklin Sat.
Mike_Summey: Okay, several of you didn’t get the article because the
email address you gave me came back undeliverable.
Roger_Dawson: Eventually you want to have a mix of properties. SFR for
liquidity and appreciation. Multi unit buildings for cash flow.
Kim-OH: Mike, here’s my addy if you are going to resend,
raring2invest2003@yahoo.com
Al_Lee: DC, I was poor and didn’t like it. I was not stupid, though. I
studied all the available investment vehicles and decided that rent houses made
the most sense. Safest, and highest long-term returns and best tax benefits.
DaveNRichmond: Here’s a question for the more experience investors. The
first time you found out you had bought something with termites…..what did you
do? did it kind of kick the wind out of your sails?
Mike_Summey: Ralph, when can you have it on the website?
Bob_Carr: Mike - Bring it On!
Sandy: sldarcy@cwnet.com
Roger_Dawson: Dave, no, just get it tented and move on. Always get a
termite inspection when you buy in future.
Kim-OH: Hi Roger, I’m slowwww tonight!!
Mike_Summey: Dave, you should have the property checked for termites
before you buy it.
MarkNC: I got mine Mike, thanks.
Al_Lee: Dave, half the hosues in Texas have termites. You treat for them
and go about your business. It is not that big a deal unless you let them fester
for a while and they manage to do soem serious damage
DaveNRichmond: Roger, but what about all the work to fix the termite
problem?
gabi: Roger - would you say that the average rent increase could be about
5% a year?
Roger_Dawson: Hi Kim, hope you’re feeling well. I’m one of the wise men
that Al mentioned.
DaveNRichmond: had it checked. they found nothing.
Bob_Carr: Al - I knew there was a problem in Texas !!!
Kim-OH: Roger then you should be getting ready for the Christmas season
LOL
Al_Lee: Mike is sure right there! I have a professional, licensed
inspector do every house, new or old, before I buy and I tell everyone in our
club to do the same.
Roger_Dawson: Gabi, that sounds low to me, but it varies by area.
ritchie: Sandy, regarding all the investors who will buy anything at any
price, I feel like they make it harder for the rest of us. But that does not
change my objectives; I can be patient
DaveNRichmond: they will treat the problem but I’m left holding the bag
on expensive repairs.
Roger_Dawson: I guess some parts of the country are not bothered by
termites but it’s a big problem in California.
Kim-OH: Al, I always counsel folks to get a termite and whole house
inspection
DaveNRichmond: I don’t know roger….maybe the desert doesn’t have them.
ritchie: Sandy, every property I look at and decide not to buy is part of
my education.
Al_Lee: Kim, good advice.
gabi: Roger - we are talking Washington. I’m just concerned that these
renters will refuse to pay the increase and what will we do then ? Evict or
negotiate ? I’d rather find a solution that will work for all
Sandy: Ritchie…..that is the part that is depressing me. So many are
willing to plunk down whatever is being recommended that each week, the price is
jumping for the same development.
Roger_Dawson: I was a founding investor in a termite company once. Don’t
believe everything those guys tell you and do shop around because prices vary
enormously.
Kim-OH: Sandy, it took me two years to find my first real deal and it had
great potential
Roger_Dawson: Gabi, ask for ten percent and if they squel back down to
five percent but tell them you need their cooperation on keeping expenses down.
Rob_L: Kim, 2 years…but were you making offers on a regular basis? I’ve
heard it said it will required looking at 100 properties before you actually buy
one good deal…
Roger_Dawson: Al, how to you spell squel?
DaveNRichmond: Roger if you bought a place and found out it had damage,
what do you do?
ritchie: Sandy, it’s part of the bigger fool theory and it will probably
get ugly when there are no more fools. Eventually when too many investors bid up
the prices, and there are not willing renters to sustain the high valuations,
people will hit the exit doors. Then the press will talk about all the people
who lost their shirts.
Kim-OH: Rob, yes I was making offers and getting blown out of the water
but that didn’t matter to me
Al_Lee: You can usually see evidence of termites pretty easily. Most
hosues here abe built on a slab foundation and you just look for the muddy trail
running up form the ground on the edge of the foundation. If there is no major
damage, you just treat to kill the termites and everythng is fine.
Al_Lee: Roger, spell what?
Mike_Summey: Sandy, your email address keeps bouncing back as
undeliverable.
Sandy: Thanks Kim. That gives me hope. I’m nearly ready to move out of
Calif anyway, so I’ll just keep plugging along.
Roger_Dawson: Al, if someone sticks you with a knife, what do you do?
Kim-OH: Sandy, where are you relocating to?
Sandy: Mike. I don’t know why. I just received 6. (I got your reminder
email.)Try this one:sldarcy49@hotmail.com
Larry: Try FourSeasonsConst@bellsouth.net
Al_Lee: squeal?
Penny: squeal
DaveNRichmond: well I found the damage when I pulled some siding off.
it’s not visible from the crawl space. You don’t notice it from inside, so I
guess just treat and get it rented?
Kim-OH: Hi dobefan
Roger_Dawson: DaveN: I’d look at the possibility that someone had
misrepresented the property. But I’ve never sued anyone (other than tenants who
didn’t pay the rent) and I don’t want to start now.
Sandy: I can go wherever I want. I’m used to beautiful country and am
thinking of such places as New England, Kentucky(?), but arthritis may dictate
hot dry weather.
DaveNRichmond: I’m thinking that when the bigger fool things pops it will
create some opportunity. I’m working hard now to get poised to take advantage of
that opportunity
Roger_Dawson: Thanks Al and Penny, squeal!
Mike_Summey: Hi dobefan
Kim-OH: Roger, you’re bad
gabi: Roger - OK, I’ll try that. The prop. manager suggested to add the
WSG into the rent, I’m still not convinced that that is a good idea.
ritchie: Mike, got it, thanks!
DaveNRichmond: roger, I’m sure they misrepresented. But it’s my mess now.
Al_Lee: Roger, that is how it is spelled on this sid eof the pond. Could
be differrent “over there”.
Roger_Dawson: Yes, Al, differrent only has one R over there.
Al_Lee: If a seller knows that a house has termites he/she must legally
tell the buyer in the disclosure statement.
Penny: sure thing Roger, I get brain block on simple things like that
sometimes too! & it’s not called old age!
Sandy: I’ve mailed myself email and took 24 hours!
DaveNRichmond: Roger, you said you don’t lease? does that mean you have
all your properties month to month?
Al_Lee: Roger, a lot of folks over there pronounce an R where there ain;t
one and don’t pronounce it where there is one.
Mike_Summey: Sandy, I just sent it to the other address. The first one
kept bouncing back as undeliverable.
Al_Lee: Roger, how they remember the spellings is a real mystery to me!
Roger_Dawson: Yes, I feel that leases just protect the tenants and stop
you from raising rents. If a deadbeat tenant skips out on a lease, what’s the
chances you’ll ever collect?
Mike_Summey: Al, save your breath. Englishmen don’t understand.
DaveNRichmond: mike are they gonna post the article on the website?
Mike_Summey: I just aske Ralph that.
Sandy: I went to England and they told me that I had an accent. Go
figure.
Al_Lee: Mike, you may have hurt his feelings. He did seem a bit fragile
today.
Mike_Summey: Ralph, are you still with us.
Ralph_Roberts: YEP
Mike_Summey: Roger…Fragile…???
Penny: Don’t bother Ralph, he is posting the article!
Roger_Dawson: Maybe Ralph is putting my shopping cart up.
DaveNRichmond: speaking of people with accents. I have a house full of
German guests right now. They leave on wednesday……YAHHHH
Mike_Summey: Ralph, when can you put the article on the website?
Ralph_Roberts: i’ll see if it’s in mah email now
Al_Lee: jawohl!
Roger_Dawson: Germans! Potato pancakes and accordian music!
DaveNRichmond: They have been here a month…
Mike_Summey: Now! Now! Be Nice!
gabi: Roger - I thought month to month leaves it too iffy for the owner.
I guess I’m wrong about that.
Roger_Dawson: I’m married to a German. I’m allowed.
DaveNRichmond: My wife is German and she teaches German at the local high
school….theyare here as part of an exchange….I’ve had all the bizarre
political discussions I can take
gabi: Roger - I love potato pancakes - don’t you?? Doeas your wife make
them??
Roger_Dawson: Gabi, let’s ask Mike. Mike, do you prefer leases?
ritchie: Ok, now there is 3 of us. Meine frau ist auch aus deutchland.
Penny: and a mightly fine German lady she is, Roger!
ritchie: (My wife is also from Germany)
Roger_Dawson: No Gabi, snitzel and noodles, just one of my favorite
things!
Al_Lee: I always get a lease. I have had lenders ask for copie sof the
leases on my properties to confirm my income
Mike_Summey: Sandy, the second address bounced also.
Kim-OH: Mike, thanks I got the email
DaveNRichmond: I lived there for a year. that much I can comprehend
ritchie: Dave, just be sure to leave the air conditioning off. They hate
it
Al_Lee: meine Mutter war in Deutschland geboren
gabi: Roger - I love Schnitzel too. My mom makes them when she comes to
visit. I miss Germany sometimes, but have been here 27 years now.
DaveNRichmond: I have a fire in the woodstove right now.
Penny: whow, look at all these cultural people in this chat!
Roger_Dawson: Gabi, then you must be Gabriela. My bride is Geese Ella.
DaveNRichmond: Gabi….. that’s the name of my wife’s cousin who I met
this summer. never heard that name before then.
Mike_Summey: gabi, roger, I use 12 month leases, but as Roger has said
earlier, it’s virtually impossible to collect from a deadbeat tenant. That’s why
we focus so much on checking them out before leaseing.
Sandy: Hello! I don’t know what to say. I just received an email on the
hotmail account. How’s your typing? (Teasing.) When Ralph gets it on the
website, I’ll get it from there. But I wonder why everything is bouncing. I’ve
paid all my bills on time.
Al_Lee: Roger, do you mean Giesela? Or soemthing like that?
Roger_Dawson: That’s right Al
ritchie: Mike, Al, Gabi, Roger: my banker has told me that a 1 year lease
is all you need to show income to offset the debt of a rental house. Otherwise
my personal debt/equity ration is sky high.
gabi: Roger - yes my full name is Gabriele. People often ask how to spell
Gabi
Ralph_Roberts: Mike’s bubble article is posted.
Al_Lee: ritchie, that is exactly what I was referring to above.
Mike_Summey: ritchie, I’ve never heard that from a banker on a
residential property.
Mike_Summey: Hi JS
MarkNC: My banker says the same thing.
Al_Lee: I have month-to-month tenants who stayed after theri original
lease was up and did not want to sign a new lease. They pay a permium in the
rent and I love it.
MarkNC: That I need a lease that is.
ritchie: Mike, no kidding? Maybe because you have enough assets in your
portfolio that a single property is no longer the issue?
gabi: Dave - Gabriele is a very common name in Germany. We had 4 in my
class at school. My teacher gave us nicknames to keep us apart.
ritchie: Mike, I think for us little guys who are still getting seasoned,
they want to see a 1 year contract.
Mike_Summey: ritchie, I’ve never heard that before, not even when I only
had one propety.
Mike_Summey: marknc seems to agree with me
Al_Lee: Mike, that is because anyone can just look at you and know you
are a reliable loan risk.
Mike_Summey: Al, it’s my honest face.
ritchie: Mike, hmm. Maybe I need to talk to your bankers.
DaveNRichmond: Had to put some wood on the fire.
MarkNC: Actually no Mike, I agree with everyone else, with a lease my
banker will offset the debt paytments with the income.
Roger_Dawson: There was a front page article in the LA Times today about
how many borrowers are paying far more interest than they need too. Turns out
loan brokers are not giving borrowers the best deals they can.
Kim-OH: Mike, I just read your reminder and I wish your mother a speedy
recovery
Sandy: What link do I go to for that article?
Al_Lee: We who weren’t blessed with an angelic face hav eto prove we have
enough income–espacielaly when most of your inocme is rents!
DaveNRichmond: Gabi, we were warned that the teacher who has been staying
with us is a bit “odd” but I wasn’t prepared.
Larry: We just got a check in the mail from the local govt for $600. we
had a judgement against a former tenant for 5 years and the city collected and
sent us a check.
Roger_Dawson: Go to LATimes.com. I don’t think there’s any charge but
they’ll ask you to register.
Mike_Summey: Most residential leases aren’t worth the paper their written
on for financing purposes. Any banker in the know will tell you that. If they
don’t understand that they’ve got a lot to learn.
ritchie: Roger, someone mentioned that realtors work for neither the
buyers nor the sellers, they work for themselves. Ditto for brokers.
gabi: Dave - that weird?? I guess there are some out there.
Mike_Summey: Sandy, Ralph said it is now posted on the website. It will
be on the home page.
Roger_Dawson: Yes, Ritchie. That makes sense. And I’d trust a real estate
agent before I’d trust a loan broker.
DaveNRichmond: Gabi….I found out that our CIA took down the towers
because we are bloodthirsty and were looking for a war to drive up the price of
oil.
Ralph_Roberts: yes, top article
MarkNC: Speaking of wood on the fire, I just let the cat in and its
snowing hard here. And it was almost 80 two days ago. Go figure.
Mike_Summey: Mark is less that 100 miles from me.
gabi: Dave - I see what you mean.
Kim-OH: Mark, yikes, its just snowing a little bit here every now and
again
DaveNRichmond: I told him what he was full of….and I’ve been drinking a
lot of wine the last few weeks to keep me in good cheer
Roger_Dawson: I need to leave you now to drive down to Hungtington ‘B
Roger_Dawson: Beach to do a seminar in the morning.
Mike_Summey: Roger has to go speak to earn some money
ritchie: Mark, snowing where?
Kim-OH: Roger, have a good trip and a great seminar
MarkNC: good night Roger.
gabi: Bye Roger - have a good night.
Mike_Summey: Goodnight Roger
Roger_Dawson: I’m looking forward to next week when our guest will be an
insurance agents. Mike will fill you in.
Al_Lee: Dave, sounds like you had a trying time with those visitors. I
would have booted them onto the street, being the bloodthirsty Texas cowboy that
I am.
DaveNRichmond: it’s raining and cold here, but a good 20 ddegrees away
from snow right now
Sandy: Roger…..that only takes an hour from where you live. SoCal
traffic isn’t that bad!
Kim-OH: Roger, I need to learn to deal with the insurance adjusters
Penny: goodnight Roger, sweet dreams
MarkNC: Snowing in Boone, NC. Supposed to just be flurries tonight, this
is what happens when you are at 3500 feet elevation
Mike_Summey: Kim, that’s an idea! Maybe I’ll invite an insurance adjuster
to one of the chats.
ritchie: Mark, are there any lakes near Boone?
Kim-OH: Mike that would be great because I’m getting the runaround from
mine
DaveNRichmond: Al, I’m all cowboy and no hat. But my wife has a
professional relationship with the Gymnasium (high school) that this clown is
from that dates back many years, so I bit my tounge……hmmm maybe that’s why
she has been so nice to me
Penny: Goodnight all
Bob_Carr: That’s a great idea Mike
ritchie: Mark, is there any development on Watauga lake?
Al_Lee: Dave, she owes you big time!
Mike_Summey: Our guest next week will be Doug McKinney, an expert in
property insurance. He was supposed to be with us tonight, but had an emergency
come up.
Larry: Mark, My daughter wants to go to college next year in Boone -App-
Nice town
MarkNC: Yes there is some development on Watauga Lake, its a little
remote from anything to have anyhting other than vacation stuff but there is
some of that.
MarkNC: Larry, I am a professor at App. I teach math.
DaveNRichmond: I have a question about noi. I have read the explanation
in millionaire several times and I still have a bit of trouble getting my thick
head around it.
Kim-OH: Mike, thanks for arranging the guest next week
Mike_Summey: I’m going to have to leave you as well. I’ve been up since
5:00 this morning. I had to take my mother to the hospital very early.
Mike_Summey: goodnight all.
DaveNRichmond: definition of NOI is different depending on where I look.
Mike_Summey: next week.
DaveNRichmond: Night mike.
Kim-OH: Mike, I will pray for your Mother’s speedy recovery and you take
care
Larry: Goodnight Mike.
MarkNC: Good night Mike, hope your mother continues to improve.
ritchie: Dave, it’s what’s left after basic expenses
ritchie: bye Mike, thanks
DaveNRichmond: but how much do you calculate for expenses?
DaveNRichmond: I’ll give you a for instance.
gabi: Bye Mike
Ralph_Roberts: good nite guys… will post chat shortly
Kim-OH: Ralph, thanks again as always
ritchie: Dave, everything besides financing costs. Tax, insurance, HOA
dues, grass seed, maintenance, property manager, etc.
ritchie: Dave, rent minus all that is the NOI
Al_Lee: Some people don;t include debt service in noi, I do. The reason
is because for many types of RE investing you can not lock in
“permanant” rates and terms, so debt service will vary over time. I
recommend that you use long-term fixed -rate loans, so debt service is
relatively static once you have established the purchase–therefore, I factor it
into NOI
MarkNC: Davem how much that will be of course is the million dollar
question.
DaveNRichmond: my first rental was my home before I moved into my wife’s
house. paid 80 grand. started renting for 800. at first my payment was about 700
but I refinanced at it’s down to about 620 a month. I raised the rent to 830
this year
Kim-OH: Goodnight all, I will try to be here next week
ritchie: Dave, that doesn’t mean much if you are not counting all the
other expenses
gabi: Goddnight Kim
DaveNRichmond: This one I just bought was 74K. Will rent for 780 -800
DaveNRichmond: I’m advertising it at 820 this weekend.
JS: what market, dave?
ritchie: Dave, the rent minus the payment is a small part of the picture.
Can make something look better than it is. People selling to investors tend to
omit the expenses.
DaveNRichmond: That’s a slim margin, I know.
MarkNC: Dave, those numbers sound good but you need to consider, taxes,
ins. maint. etc. to get a real picture.
DaveNRichmond: I’m in Richmond
ritchie: Dave, sometimes we try to talk ourselves into a deal by fudging
the numbers or excluding expenses.
ritchie: that can be costly.
gabi: Al - tell dave about your cool calculators.
Al_Lee: I have a comprehensive spreadsheet that factors in all the
expenses and computes ROI for first year and for 30 years afterward. You can
download it free by going to www.TurnkeyInvestments.net and clicking on the
“Spreadsheet help” link and then following the instructions.
DaveNRichmond: I’ve paid 700 to have some work done and done some myself
onthis rental.
MarkNC: I gotta go, wife is calling.
ritchie: bye all. thanks for a good chat.
DaveNRichmond: Cool. Thanks Al. I was hoping to get it painted but my
painter has been busy, so I’m spraying it this weekend ( if the weather report
is correct.
gabi: Dave - I use Al’s caculators all the time when I’m looking at a
property.
Al_Lee: I have to go kiss the kiddies goodnight, too
DaveNRichmond: night al
DaveNRichmond: I guess the party’s breaking up
Al_Lee: thanks for the plug, gabi.
Al_Lee: Gotta run
gabi: Got to go too - bye everybody
DaveNRichmond: I better go too or they will talk about how rude the
American was
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