Friday, December 14, 2012

What is a good formula for splitting profits on a rental property investment?

Q. I am involved in a 3-way investment on a rental property and we are being forced to sell because of a DOT project. Our profit on this property will be approximately $75,000 and we need to figure out how to split this up. Being close family members, we weren't too concerned about figuring this out we bought the property.

I would really appreciate any suggestions from real estate investors experienced with partnership investments like this.

Here are the figures for the capital and work/mangement invested by each party.

Investor #1:
Invested $150, 000 by taking out a regular home loan.
Lived at the property and payed "rent".
Did 85% of the maintenance, improvements and rental property management.

Investor #2:
Invested $75,000 from a home equity line of credit.
Did 0% of the maintenance, improvements and rental property management.

Investor #3:
Invested $25,000 from a home equity line of credit.
Did 15% of the maintenance, improvements and rental property management.

Thank you!

A. Since Investor #1 paid rent and primarily maintained the home, it would be split like this
$250,000 purchase price; profit is 75,000 (I assume you have already taken the maintenance out of this)
Investor #1 paid $150,000 / $250,000 = 60% of $75,000 profit = $45000
Investor #2 - paid $75,000 / $250,000 = 30% of $75,000 = $22500
Investor #3 - paid $25,000 / $250,000 = 10% of $75,000 = $7500

If you haven't taken out the maintenance, then you need to deduct the cost of maintenance out of the profit and pay each of the parties back for the maintenance they paid. Keep in mind that investor #1, as a renter, would normally have had to maintain the property but I'm assuming that he did more than just "maintain" the property.


How can I invest in cash only rental property not with cash but using a loan?
Q. I live in Los Angeles looking to buy rental property in Florida. I'm looking at small investments (under 40,000) to then rent out. How can I take out a loan so I don't use all of my own money? (Cash only sellers will not wait the period it takes to secure the loan . . . ).

A. You would need personal loans leveraged against your other assets.

YOu are very brave.


Drawbacks of using debt when investing in real estate?
Q. I have friends that tell me that they are making a lot of money by using leverage in real estate.
They say that it magnifies their profits while reducing their risks.
What are the drawbacks of using debt to invest in rental properties?

A. Declining real estate values. Tenants who don't pay.


What are some alternative ways to finance a 2nd rental property?
Q. Here is the situation. I have one rental property that is a triplex through a land contract in Columbus Ohio. I have had this property for about 6 months now. I am still learning the business of being a landlord so any advice is greatly appreciated. I am wanting to purchase another property but I don't have enough cash for a down payment on a loan through a bank. What are some options to purchase another property?

A. Oh my brother I have the same problem I find great deals all the time that will cash flow even if I borrowed 100% of the money but no one wants to lend.

Really, your only options are:

1) friends/family loans
2) bring on outside investors
3) hard money lenders
4) real estate investment clubs

2-4 can be found by google searches.

Good luck, I wish it were easier. I really hate lenders. They're the worst part of the work needed to invest.





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Monday, December 10, 2012

What type of insurance could be puchased for multiple homes that are purchased and being fixed up?

Q. In addition to our 2 homes, we currently own 2 houses that we are fixing up. I am wondering if I could get a blanket home owners policy that we insurance our homes as well as the homes that are being renovated

A. You need a "remodeler's builder's risk" on the houses you are fixing up, then tenant dwelling coverage on them when complete. Since the houses would be vacant - I wouldn't count on my homeowner policy to cover them.

Are you going to live in them or rent them out?

You might want to consider a property owner liability policy and then perhaps an umbrella (sold in $1M units -$1M, $3M, $5M) over the general liability.

Just find you a LOCAL independent agent - he should have several different companies with which to help you.

Good luck and I hope this helps!


how can you find out who own a certain piece ofproperty?
Q. found a vacant home and trying to find who owns it so i can either buy or rent it. any ideas on how to find it for free online.

A. Your county court house, get their web site or go in person, all you need is the address.


What is the easiest way to buy a home if I already own one to sell ?
Q. I own a condo and am looking to buy a home and sell my condo and use the equity for a down payment.

A. Most people don't find this a problem at all. You are not the only one wanting to sell the property you occupy to buy another home.
You put your home out for sale, and let the seller of your dream home know you want to buy it. If the timing is bad and you can't cross over from one to the other, you can do one of these:

1. Stay in your present home after selling it, but you tell the new owner you will rent it from them for a few months, or even a year before handing it to them with vacancy.

2. Buy the new place and tell them that you may have to take occupancy of the new place without having paid up fully yet, but you are either going to rent the new premises or pay them extra in the sale price. [Amounts to the same thing.]

3. Sell your present home, move out to temporary quarters like with relatives or a cheap hotel or some premises that are vacant because the owners don't live there except in summer or that happens to be vacant for the interval bridging your moving out of your old property and moving into your new property. Let the landlord know it is for a short term lease. The owners tend to charge more rent for short leases.

4. If you are monied, not working at your home because you have people working for you, go abroad and live in luxury premises. Especially to a country whose exchange rate favours your going there. Have a holiday with that rental money you would have to spend back home to do nothing but wait! Go learn a course and upgrade your marketability.

5. If you are at that age when the kids are studying abroad, go visit them with the excuse you have no place to stay and then you know what they are up to. And can continue to bond with them. You can do all these if your new home is cheaper than your old home!

You can call house movers who will tell you the costs of packing your household items and keeping it in their warehouse and charging you rent there, then move them to your new premises.

Your presence helps when the movers are packing, if you see what items are inside the boxes so you can label them: Bedroom 1 or Bedroom 4 or Living Room . Then go label your new home's doors with Bedroom 1 and Bedroom 4 and so on so they know which box to unpack where.

[Antiques you bring yourself to your temporary quarters. My soapstone hope chest had all the soapstone carvings fall off and I was not there to search for them in the boxes they came in because they had thrown it away. My teapots lost their lids. Grrrr! You must remember this when using movers.]

It is always psychologically pleasing to go to live in new premises. One of the fall-outs is that new babies get born each time the parents move house. Wonder why.


What do you look for when buying an investment property to rent?
Q. Any pointers? Like cheap houses to fix up and rent out.

A. If you are going to rent it out , do not put a ton of money in to this property , very few people make anything with just one house , and with the number of people who are defaulting, You will have to choose your tenants carefully without discriminating or that could lead to further legal trouble, my point is the majority of renters will not take care of your property , pipes will leak for months before you are notified , and BIG deal you keep the security deposit , most of the time the damage is more than the deposit , and if they stop paying rent , they get one month behind , most places has a thirty day eviction so that gives them two months rent free , then the tenants retaliate and destroy more , They can be made to fix the damage if you can find them to have them served with court papers , ...All I am saying is do not count on it as investment , because it will cost you more in the long run , NOW if there is a place that has the land you want ,with a so so house , you can do this , and let the rent help you make the payments to pay off the land , normally after 15 to 30 years the home is trashed and really not worth fixing , when the house sits vacant the payments do not , then you will more likely take in the next stranger with the money out of the urgency to rent , I had a friend to do that , the couple was very nice , had nice cars , always paid in cash , one day they were gone , come to find out those nice people manufactured meth in the home , the house had to be destroyed, the makers always look for the least likely place to get caught making that stuff. besides this is not TV , rich people do not rent, mostly those who do not pay their bills and have little or no credit are the ones who rent , Just trying to give you the other side of renting it is not easy nor is it like on TV , If you do this just for the land you may come out ok , but with a head ache , it can be done but it is no where near the easiest way to make money , I hated it when I rented properties , I finally just got out of it , and took my losses as the reminder to never do that again.





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What are the great neighborhoods to live in Toronto?

Q. I'm planning to move to Toronto at the end of this year or next and I would like some advice about which neighborhoods are nice to live.

I would like to share/roommate, paying around 550$ - 750$. Also, I would like to live in a neighborhood with people in their 20-30.

What do you suggest? Also, is there any website that can help me search for rent/roommate/etc.?

Thanks!

A. check this website out:

http://www.torontoneighbourhoods.net/search/search.html

Toronto is often called a city of neighborhoods. Each one is different with its own unique character. If you are looking for a younger and hipper neighborhood, try King West, Queen West, Yonge / Eglinton. Many people I know (in their 20's) love Yonge / Davisville.

In these, you may be able to find accomodation for that price. Otherwise, for that price you may have to live in a neighborhood more off the beaten track.

Good luck,


What are some good websites to search houses for rent in Orange County, California?
Q. What are some good websites to search houses for rent in Orange County, California? (other than Craigslist and the OC Register)?

A. A site that is similiar to craigslist is http://blurbpage.com

You can search homes in Orange County if you want.


What's the best UK website for searching apartments to rent?
Q. What's the best UK website for searching apartments to rent? What's a good price for a normal small bachelor?

A. I'd recommend
www.gumtree.com
www.loot.com
loads of ads for flats to rent, flat shares etc in all sort of price brackets


Searching for a vacation rental unit with lake view and high privacy in NJ this summer?
Q. I am searching to rent a unit to take my family to this summer.
I need to know some place or some search key work
Lake view
family of 3
bathroom
AC
light
privacy
safe.

A. http://www.homeaway.com/vacation try this sight !!





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What information does the landlord need to know to report me to the credit bureau for late rent?

Q. My landlord only know my name (not full name) and my phone number.
It's a long story. I don't live there anymore, but my old roommates still do. My name is on the lease, and they are living there month-to-month.

A. He knows where you live, doesn't he? But I'm a landlady myself; as long as you pull through with the rent your landlord isn't likely to report you to a credit bureau. He is more likely to charge you a fine for paying your rent late, and if he begins to fear that you won't pay your rent at all because of inconsistently paid rent then he might start the process of eviction. So the best thing to do is to apologize to your landlord and make sure that all future rent payments are made before the 1st of the month so that he'll begin to trust you.


Is a landlord obligated to provide the full name of a hired maintenance professional?
Q. Is a landlord in California, obligated to provide the full name and contact information for a person hired to perform maintenance on a rental unit? Specifically are they obligated to provide the information of a hired plumber?

Also, are they obligated to give notice if the water is going to be shut off in a rental unit?

A. Of course they are not. The plumber should knock on the door before turning off the water, but is not required to, if it needs to be turned off it is simply turned off, water can do a lot of damage very quickly.

The landlord does not have to disclose any information regarding anyone they hire to tenants. That is none of their business.


How much can a landlord reasonably raise the monthly rent cost when renewing a lease?
Q. Our landlord is installing new windows and glass doors in our rental house. We didn't ask for the improvements and will be inconvenienced during the installation. He says he's intending to raise the rent but how much is fair or legal? We live in Oregon.

A. If your rental agreement allows rent increases but does not say that your rent will increase on a particular date and by a definite amount, the landlord may not increase your rent by a percentage that is more than the percentage increase in the general cost of living.
An increase in the general cost of living is measured by the percentage increase in the Portland-Salem Consumer Price Index for All Urban Consumers for All Items as reported by the United States Bureau of Labor Statistics.


What penalty would a landlord incur by accepting additional rent money from a Section 8 tenant?
Q. If a landlord accepts (or demands!) extra money from a Section 8 tenant that pays with government vouchers, what penalty would the landlord face if caught doing so?

A. They are fined and booted from the program.

But, you need to realize that section 8 tenants pay part of their rent. We tax payers are only picking up part of it. Section 8 tells the landlord what they can charge though, and they can not charge more.





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Which is the best SEO company for Real Estate Business in India?

Q. I need to optimize my real estate business situated in USA. looking for cheap SEO provider in India.
Please suggest me some companies which you have experienced before.

A. Beware of outsourcing your SEO. I work for a U.S. search engine marketing company, so I answer from a position that could appear biased. But every time a former client, current client, or prospective client has worked with an Indian SEO firm, they have been disappointed or worse.

I can't generalize and say that every Indian SEO company is shady or incompetent. And I don't hesitate to point out that tons of U.S. search engine services are bad news too. But I think your chances of getting beneficial results are greater if you use an SEO company in your home country.

The cultural and language differences are definitely a factor. But it goes beyond that. A common feature of low-budget SEO companies is that, while they may do what they promise in terms of quantity - for example, obtaining links to your site with articles or blog posts, adjusting your site's content, and optimizing your site for search engines - the quality of the work is usually poor. You usually get what you pay for in this business. And sometimes it can even hurt your search engine presence.

I assume you're considering this out of budget concerns, which is completely understandable and reasonable. I suggest that you approach an established U.S. internet marketing company to give you a one-time consultation, ending with recommendations that you can carry through on your own for awhile. That would probably include some changes to your website and suggestions for how to obtain links to your site that won't result in a penalty and will over the long-term help boost your site's ranking.

And you can help yourself right now with one fundamental tactic. As a business serving a limited geographical area, you should ensure you have solid local optimization. That includes claiming or establishing your business listings on Google Places, Yahoo Local, and Bing Local.

http://www.google.com/support/places/
http://www.google.com/places/
http://local.yahoo.com/
http://bing.com/Local

Make sure your business is also listed in all major business directories like yp.com, superpages.com, and yelp.com. And finally, look for real estate directories where you can add your business listing (many will require payment). In all cases, your goal is not only to get exposure for your business, but to establish links to your website.


Is there anyplace to get free foreclosure listings?
Q. I don't want to be hounded by people wanting me to sign up for their foreclosure listings. I am not a real estate agent. Am interested in SW New Mexico, SE Arizona, NE Arizona mostly.

A. If you want to find the best foreclosure listings in an area, check out this site

http://best-foreclosure-listings-usa.blogspot.com/


How can I find who the top 20 real estate agents in London are?
Q. My mother is a RE broker and asked me to help her in finding the top agents in London are with whom she could place her listings. Does anyone have any clue as to what the top firms are, other than Sotheby's? Thank you so much!!

A. if they have a multiple listing service in the UK like they do in the USA, it doesn't really matter - just talk to a couple of agents and pick one you feel comfortable with - the selling agent just lists the properties - he/she doesn;t necessarily bring in the buyers


Where do I find foreclosure listings?
Q. I'm interested in getting into real estate investing and I'm wondering where I can go to find foreclosure listings?

A. If you want to find foreclosure listings, check out this site

http://best-foreclosure-listings-usa.blogspot.com/





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What's a solution/strategy to prevent a famine from happening in Vietnam again?

Q. During World War 2, there was a famine in Vietnam. What's one way to help reduce the chances or prevent a famine from happening again in Vietnam and improve the quality of the environment?

A. Increased use of a form of soil called Terra Preta or biochar which can increase crop yields up to 300 percent, requires less water and fertilizers, improves poor soils, reduces the need for deforestation, sequesters carbon to mitigate global warming and retains nutrients for centuries. This type of soil was discovered in the Amazon and was developed centuries ago by the natives there to improve poor soils.

Other means could employ drought-resistant strains of rice, aquaponics methods, etc..

Terra Preta...
"or terra preta do indio, has mystified science for the last hundred years. Three times richer in nitrogen and phosphorous, and twenty times the carbon of normal soils, terra preta is the legacy of ancient Amazonians who predate Western civilization. Scientists who long debated the capacity of 'savages' to transform the virgin rainforest now agree that indigenous people transformed large regions of the Amazon into amazingly fertile black earth. The Amazonians' techniques remain an enigma but are believed to have used slash-and-smolder to lock half of the carbon in burnt vegetation into a stable form of biochar instead of releasing the bulk of it into the atmosphere like typical slash-and-burn practices.

The difference between terra preta and ordinary soils is immense. A hectare of meter-deep terra preta can contain 250 tonnes of carbon, as opposed to 100 tonnes in unimproved soils from similar parent material, according to Bruno Glaser, of the University of Bayreuth, Germany. To understand what this means, the difference in the carbon between these soils matches all of the vegetation on top of them. Furthermore, there is no clear limit to just how much biochar can be added to the soil.

Claims for biochar's capacity to capture carbon sound almost audacious. Johannes Lehmann, soil scientist and author of Amazonian Dark Earths: Origin, Properties, Management, believes that a strategy combining biochar with biofuels could ultimately offset 9.5 billion tons of carbon per year-an amount equal to the total current fossil fuel emissions!"

http://www.worldchanging.com/archives/004815.html
http://www.sciencedaily.com/releases/2008/04/080410153658.htm
http://www.sciencedaily.com/releases/2008/12/081217190439.htm
http://www.youtube.com/watch?v=1-hSl59ET2A&feature=related
http://www.youtube.com/watch?v=mGurqqGTMW4&feature=related





Rice strains and aquaponics...one local company here in town grows a million pounds of food and 10,000 fish per year from a 3 acre site using aquaponics methods....much more than a normal farm could grow
http://www.sciencedaily.com/releases/2008/11/081120162847.htm

http://growingpower.org/
http://www.youtube.com/watch?v=jV9CCxdkOng&feature=related


Why did vietnamese emigrate to US after Vietnam war?
Q. Why did they go to the US instead of another country? They helped diem dicatorship in South Vietnam, made a mess in North Vietnam. Why after all the problems US made to Vietnam, some vietnamese can even think of emigrating in US? Dont they have any pride? Do they want to yield to America again?

A. At first, I am a Vietnamese. You should believe that my answer can give you a better understand why.

Why did Vietnamese emigrate to US after Vietnam War?
Because Vietnamese love Freedom, We have not come to the U.S for Economic.


In 1975, North Communist invaded South Vietnam in term of Liberation. In fact, as a war victory, they killed a lot of former people who�s severed for former government. A thousand of Military and soldiers -Vietnam Republican were sent to Re-education Camp where lost their life there. Vietnamese people in city were removed from their homes for North Communist Officer. Their own properties were sealed and to be taken over by local communist government. In countryside, farmer's land was controlled by Local Government.

No freedom for Vietnamese after War. All Vietnamese love Freedom but We have paid the price for it. Many Vietnamese People lost their life on the ocean. The Children lost their father and mother.

The History of Boat People is now closed, but it is still there. We never forget.


If you were married in Vietnam, can you go there to get a divorce without a signature from the spouse?
Q. I have reason to believe that my fathers young wife has gone back to Vietnam and has possibly remarried there, without our knowledge of a divorce. She apparently went there in 08 and remarried, then came back here 3 weeks later. Is it possible to obtain a divorce there without the spouses signature???

A. There are 2 sides to this story. I've seen many of these old guy/ young woman marriages fall in a heap and its always the woman at fault. To answer your question, yes, she could have come back to Vietnam and obtained a divorce, regardless of where she was married. I doubt she would have remarried here. Not in 3 weeks anyway, and certainly not to another foreigner. But here's a question. Why would she do this via the back door relinquishing her right to property settlement? Is there any property involved or was this another case of an old guy promising the world and delivering very little, on all fronts? Seen it many, many times! I've also heard the woman's side of the story many times as well and they're all similar. Old guys are exactly that, old! Throw in alcohol, and or nicotine, and or prescription medication and you've got someone in need of a nurse, not a wife! I could say plenty more but most guys will know what I'm talking about. I suggest he contact a lawyer or the Family Court in his country. They can advise him on where he stands.


If I retire and then I move to another country Will I be able to receive my social security benefits? How?
Q. I have a friend who is close to retire(he's 67) he owns a property in Costa Rica and another in Cuba, yes in Cuba. Well he was told that if he move to another country he will loss his social security benefits as well as the medicare. How true is that? There is any way to maintain those benefits at the same time he has fun out there???

A. Benefits to Cuba are out, but Costa Rica is ok...

U.S. Treasury Regulations
U.S. Treasury Department regulations prohibit sending payments to you if you are in Cuba or North Korea. If you are a U.S. citizen and are in Cuba or North Korea, you can receive all of your payments that were withheld once you leave that country and go to another country where we can send payments. Generally, if you are not a U.S. citizen, you cannot receive any payments for months in which you live in one of these countries, even though you leave that country and satisfy all other requirements.

Social Security restrictions
Social Security restrictions prohibit sending payments to individuals in Cambodia, Vietnam or areas that were in the former Soviet Union (other than Armenia, Estonia, Latvia, Lithuania and Russia). Generally, you cannot receive payments while you are in one of these countries, and we cannot send your payments to anyone for you. However, exceptions can be made for certain eligible beneficiaries in countries other than Cuba or North Korea.

To qualify for an exception, you must agree to the conditions of payment. One of the conditions is that you must appear in person at the U.S. Embassy each month to receive your benefits. Contact your nearest U. S. Social Security office or U.S. Embassy or consulate for additional information about these conditions and whether you might qualify for an exception.

If you do not qualify for payment under this procedure and you move from one of these countries to another country where we can send payments, you can receive all the benefits for which you were eligible except when you were in one of the countries listed in the section Social Security restrictions .





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How can we rent a house by a lake for vacation this summer?

Q. A couple of friends and I are looking to rent a house on a lake in New York somewhere this summer, we've been looking at lake George since it's the most well known, at least to me, but we're open to other lakes. I don't really know where to get started on looking, most of the things we have found online have been hotels and we would prefer a house. Does anyone have any good websites or any suggestions on how we can find something?

Thanks!

A. This website is the absolute best for finding a house or cottage to rent http://www.vrbo.com/

You can search by state and then region and then right down to a particular town. Then refine your search by selecting the number of bedrooms or whatever your requirements may be.

I recently did a search there and one of my requirements was a hot tub. I put that in as part of my search and then was able to look only at vacation homes equipped with one.

Hope this helps! It's a great way to find a wonderful vacation home!


What do you i need to do to rent a house?
Q. I want to rent a house or apartment in brisbane and was wondering what i need? ID, bank statements, payment slips, etc? Also, can i negotiate a lower rate of rent and a smaller length of time? What do i do if i want to break the lease? Do i get bad credit?

A. Every place you go, either house or apartment will have different requirements, different rent rates and different lease length options. Your best bet is to start calling around or visiting the places in person to find out everything you can before you decide on a place.


What are the requirements for renting a house for a wedding?
Q. My dream wedding is to rent a house in orange county california somewhere with a rather large backyard for my wedding. There would be at least 150 guests. What are the requirements? Do i have to alert the city, the neighbors, would parking be a problem? Please someone advise. Thanks! Michelle

A. Individual houses rental policies are determined by the owner or the agency you are renting through.

Call a vacation rental agency and see if they have any houses that would meet those requirements.

Many owners put a limit on how many people can be present in the house due to noise regulations in the neighborhood and the destructive nature of large parties. However agencies usually have a cleaning service cost included in the rental cost which would be a good idea.

They will also know if that particular city has a requirement on renting offduty policemen--mandatory for many parties with large numbers and alcohol served.

Do you care if it is beach front or not? You can get much cheaper if it isn't beach front.

Hope this helps somewhat--but really the rules vary greatly for each vacation rental company.


Do military need good credit to rent a house?
Q. I am going to get married in March and will receive BAH from the Army to rent a house. Will I need credit to get a house though? I don't even own a credit card...

A. Thank you to you and your spouse for your service.

However, that does not garner you any special consideration when renting a place. You still have to qualify for residency per the landlord's requirements.





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