Rental (by Larry [IN]) Mar 18, 2018 6:38 AM
Rental (by NE [PA]) Mar 18, 2018 6:55 AM
Rental (by NE [PA]) Mar 18, 2018 7:01 AM
Rental (by plenty [MO]) Mar 18, 2018 7:02 AM
Rental (by cjl [NY]) Mar 18, 2018 7:05 AM
Rental (by NE [PA]) Mar 18, 2018 7:19 AM
Rental (by Larry [IN]) Mar 18, 2018 8:15 AM
Rental (by NE [PA]) Mar 18, 2018 8:17 AM
Rental (by LindaJ [NY]) Mar 18, 2018 8:27 AM
Rental (by Larry [IN]) Mar 18, 2018 8:47 AM
Rental (by Ken [NY]) Mar 18, 2018 9:07 AM
Rental (by Larry [IN]) Mar 18, 2018 9:23 AM
Rental (by NE [PA]) Mar 18, 2018 9:27 AM
Rental (by Larry [IN]) Mar 18, 2018 9:36 AM
Rental (by Sisco [MO]) Mar 18, 2018 9:55 AM
Rental (by AllyM [NJ]) Mar 18, 2018 10:05 AM
Rental (by Larry [IN]) Mar 18, 2018 10:22 AM
Rental (by Larry [IN]) Mar 18, 2018 11:09 AM
Rental (by Vee [OH]) Mar 18, 2018 11:39 AM
Rental (by Ken [NY]) Mar 18, 2018 12:07 PM
Rental (by Robert J [CA]) Mar 18, 2018 12:32 PM
Rental (by LindaJ [NY]) Mar 18, 2018 1:05 PM
Rental (by Larry [IN]) Mar 18, 2018 1:21 PM
Rental (by elliot [RI]) Mar 18, 2018 2:14 PM
Rental (by Robin [WI]) Mar 18, 2018 4:49 PM
Rental (by Vee [OH]) Mar 19, 2018 5:49 AM
Rental (by RB [MI]) Mar 19, 2018 6:33 AM
Rental (by BRAD 20,000 [IN]) Mar 19, 2018 8:19 AM
Rental (by Barb [MO]) Mar 19, 2018 9:21 AM
Rental (by Larry [IN]) Posted on: Mar 18, 2018 6:38 AM Message:
I am buyer of a vacant duplex rental. After the purchase agreement was signed by both seller and myself, the leasing company rented one side of duplex. I bought the duplex “as is” , wanted to upgrade property for electrical wiring safety and remodeling to to reduce my landlord liability with questionable electric wiring and some other issues.
Plus, I wanted to lease to tenants by my financial qualification. I want the property, I spent a lot of time and effort searching and inspecting property. There is a clause in purchase agreement for 50$ per day penalty if seller does not give possession at closing. Also clause that prevailing party is reimbursed for attorney fees. Seller has realtor but seller lives out of state. L.L. --107.147.xx.xxx |
Rental (by NE [PA]) Posted on: Mar 18, 2018 6:55 AM Message:
Make them get them out. Or use it as leverage. --50.107.xxx.xxx |
Rental (by NE [PA]) Posted on: Mar 18, 2018 7:01 AM Message:
If you're using it as leverage, shoot for a reduction in price double to what it would cost you in lost revenue and time to wait until the lease expires. Include in that, leaving the other unit vacant.
If you can get that reduction, then ride out the lease with them. --50.107.xxx.xxx |
Rental (by plenty [MO]) Posted on: Mar 18, 2018 7:02 AM Message:
What? What leasing company? You hired them? What? --99.203.xx.xx |
Rental (by cjl [NY]) Posted on: Mar 18, 2018 7:05 AM Message:
Well - a few thoughts on this. Did you know/were you aware that they were actively seeking tenants? Do you have anything in the contract to indicate that the building was to be left VACANT?
The "as is" in a contract doesn't necessarily mean that it would be left with no tenants - its about the structure itself and just means "what you see today is basically what you should see when you purchase it". Yes I know you are thinking "there were no tenants" but think about it this way: When someone is purchasing a home to live in - many times the Seller still lives there. That statement "as is" would still be in the contract - I wouldn't think that the buyer would expect to see the Seller still there at closing :).
Look at the contract - does it state "subject to existing tenancies"? If so - then you may have an issue there as well.
Is the tenant in a month to month or a lease? If it's a lease you are potentially "stuck" with the tenant until the lease is either broken or run its course (ends).
I would find out if they are looking for other tenants to fill the other vacancy ... if they are get them to stop ASAP (when are you closing)? It may be a "money/income" thing for them. Also - are you using a Realtor? If so get them involved ... this is where you should have turned.
I'm not sure if you can negotiate anything now but you can try.
Good luck!
--69.201.xx.xxx |
Rental (by NE [PA]) Posted on: Mar 18, 2018 7:19 AM Message:
You absolutely can negotiate now. Most realtor involved deals have contracts that are geared more towards protecting the realtors. Slam on the brakes and kick and scream about it. (If its that big of an issue for you)
Everything is negotiable until money changes hands. --50.107.xxx.xxx |
Rental (by Larry [IN]) Posted on: Mar 18, 2018 8:15 AM Message:
Did not know they were trying to rent , sellers says she told her leasing company not to lease, break down of communications, I guess. Possession at closing means possession at closing. I do not have possession if rented.
Just deeding property to buyer but causing a lease, that does not give possession at closing, is not adherence to purchase agreement: Concerned about liability of electrical system . Was not going to rent until I rewired. It would be extensive. 2 story makes it extensive. --107.147.xx.xxx |
Rental (by NE [PA]) Posted on: Mar 18, 2018 8:17 AM Message:
Ask for the electrical to be fixed before you close.
Get creative. --50.107.xxx.xxx |
Rental (by LindaJ [NY]) Posted on: Mar 18, 2018 8:27 AM Message:
Sorry, a rental is a rental, possession at closing has nothing to do with the tenants. Any leases that are in place have to be honored, but you can offer the tenants a way out.
If indeed you want it vacant, you have to specify that. SO unless you specified VACANT, or NO TENANTs, then you really don't have much to stand on even if that is what you thought you meant. If they are month 2 month, you can just give them the month notice once you get the possession, or require the seller to give it to them earlier.
Go back to seller / agent. Work on what you can do to get if vacant, Cash for keys or monetary incentive to you (less for price) because you tenants.
On the other hand, note that you can start depreciating half the building because it is rented, you have some income, you can fix the other unit while you get them out, then work on that unit, your insurance will be way cheaper because it is not vacant. --96.236.xx.xx |
Rental (by Larry [IN]) Posted on: Mar 18, 2018 8:47 AM Message:
Thanks for opinions , appreciate more. If a lease does not exist at Purchase Agreement contract and owner can lease property, then that means that seller can commit buyer to a 12 month contract and seller collect a couple thousand dollars of rent themselves before closing and buyer would be in a 10 month remaning lease with new tenant. If that were ok and sellers did that to buyers then there would be chaos. Imagine you bought a home to live in and found out the seller rented it and you have a 10 month tenant and you can’t move in. --107.147.xx.xxx |
Rental (by Ken [NY]) Posted on: Mar 18, 2018 9:07 AM Message:
Maybe you should consider this,the goal of a rental property is to collect rent,maybe you should try to determine if the tenant they put in there is acceptable instead of I just wanted it vacant.Also why do you think you have liability as it is?I have known a lot of guys who talk about wanting to be a landlord but then they buy a place and spend months fixing things that didn't need to be fixed etc all because they never did this before and really don't know what they are doing,i buy lots of houses and rarely find electrical problems so bad I cant safely rent it.Who told you something wasn't safe? --72.231.xxx.xxx |
Rental (by Larry [IN]) Posted on: Mar 18, 2018 9:23 AM Message:
Can see your point, but I could easily rent for more money if electrical updated and a little remodeling. Larry --107.147.xx.xxx |
Rental (by NE [PA]) Posted on: Mar 18, 2018 9:27 AM Message:
Larry, I'm all for using the new tenants as leverage for a reduction, but I highly doubt the electric will affect rent price.
Remodeling a little, yes. Electric upgrade? Not so much. --50.107.xxx.xxx |
Rental (by Larry [IN]) Posted on: Mar 18, 2018 9:36 AM Message:
Can see your point also. --107.147.xx.xxx |
Rental (by Sisco [MO]) Posted on: Mar 18, 2018 9:55 AM Message:
You bought an income producing property and you have income from day #1 if you go along.
Instead, you think that the seller should give you a concession, and buy out the tenants lease or else you will walk from the deal. All because of Your schedule to remodel???
I truly do not understand your angst. --72.172.xxx.xx |
Rental (by AllyM [NJ]) Posted on: Mar 18, 2018 10:05 AM Message:
That's crappy. The best laid plans of mice and men aft gang aglie or so they say. I would either walk away and cut my losses or take possession and deal with the tenants possibly offering them cash for keys to the point of paying their security for another apartment. If they are OK and can pay the rent, determined by a credit check, I would keep them and work around them Unless it's knob and tube wiring, and I would not want anyone moving into that under my supervision. Electric guys can pull wire from second floor. Had it done, but you might have some pipes running up the outside to the attic if there is not a chase at the chimney. Don't sweat it. After dad passed I inherited ten properties that all needed some level of electric upgrade. Those electric guys went up to the second floor of four plexes and dug around in insulation to pull wire and upgrade the electric. But that was twenty years ago so maybe those kinds of guys are a thing of the past. Not sure. --69.141.xxx.xxx |
Rental (by Larry [IN]) Posted on: Mar 18, 2018 10:22 AM Message:
Yes, knob and tube. Problematic in many ways. Probably won’t walk, like the property, the Realtor is looking to relocate tenant, if they can’t relocate or buy out tenant and won’t make allowance I will close.anyway. Larry --107.147.xx.xxx |
Rental (by Larry [IN]) Posted on: Mar 18, 2018 11:09 AM Message:
Thanks to all responders, I am first time user , nice to get other perspectives. --107.147.xx.xxx |
Rental (by Vee [OH]) Posted on: Mar 18, 2018 11:39 AM Message:
As a repairman to my places you have a valid concern about the wiring, due diligence includes not only the tenants in the place but you need the esstopel letter singed by everyone, this is the legal descrpition of who owns what appliances, uses what interior storage area, garage, parking spaces - every realtor should know about this form with rental property. --76.188.xxx.xx |
Rental (by Ken [NY]) Posted on: Mar 18, 2018 12:07 PM Message:
I have places with knob and tube,not whole places but sections here and there sometimes hidden in walls.That is not a good reason to leave a place empty and that wont affect the amount of rent you can charge,very few tenants would even know the difference. --72.231.xxx.xxx |
Rental (by Robert J [CA]) Posted on: Mar 18, 2018 12:32 PM Message:
Like everyone else, I've had problems buying property that was supposed to be vacant at the time of closing. SO instead of losing the deal and WALKING AWAY, I've come up with a solution. I have escrow hold back funds going to the seller. If things can't be resolved and I have to resolve things on my own, those funds get released to me after I product specific proof. Here are a few examples:
A property was listed 56 feet wide by 180 feet deep. When I measured the width of the lot, a fence was placed by a neighbor, 3 feet onto the property I was purchasing. The neighboring property's owner and management company wouldn't give me the time of day. So I estimated the cost to remove and rebuild a new fence, the survey costs and possible lawyer fee's could reach $10,000 to $15,000.
So we agreed to hold in escrow $10,000 against the cost of dealing with the loss of 500 square feet of property. The land value at that time was around $12,000.
Another time a tenant was supposed to have moved by the close of escrow. The tenant's new rental fell through and they wanted to say for an extra 30 days. I had the seller give me a credit in escrow for the cost of an eviction and 2 months worth of lost rent. I also got the tenant deposit credited to me.
In both cases I made out like a bandit. But in the case of the fence I was able to get City Records of a fire that burned down the old fence and then the new fence was placed onto my property. That was 4 years prior. They hadn't gained an easement yet. So one day I installed new galvanized metal posts along the boundary line on my side. And the next day I installed a chain like fence. The tenants of that building, the management company and that owner called the police and began to remove my new erected fence. I had them arrested! With my survey in place and they insurance claim from them installing the replacement fence less than 5 years ago, they had no cause against me. Plus they never responded to my letters or requests. Shelf help was okay when I had all of the proof and I tried to work things out with them.
After this was done and I had a surplus of funds, I returned the unused funds to the sellers. In turn they gave me back half of the money saying I should be rewarded for being honest and getting things done cheaply. Plus they carried back the mortgage and I was going to have a relationship with them for 30 years. --47.156.xx.xx |
Rental (by LindaJ [NY]) Posted on: Mar 18, 2018 1:05 PM Message:
If you signed a contract when the "rental" property was vacant, it should have specified that it will be vacant when you close. Yes, the owner could get someone in there for the 2 months it takes you to close and collect that rent, but if you specified vacant, it would need to be vacant. If you did not, it is you / your agent / lawyer that screwed up. It does not sound like it was the intent of the seller to rent it though.
Find a way to make the best of it. Don't cry about it. Again you have income coming in, and a tenant. Most of us realize that CAN be easier and worth more than a remodel now. Plan the remodel for the vacant unit, advise the tenants that you will be rewiring, and they have choice of staying or leaving during it. But you might find the numbers work better for you with a tenant. Again look at depreciation costs with your accountant and insurance costs with your agent.
The knob and tube has worked fine all these years, what makes you think it won't tomorrow. Put it on the list, but it probably isn't an emergency. Most tenants don't understand the wiring, heck half of them can't even change a light bulb :) --96.236.xx.xx |
Rental (by Larry [IN]) Posted on: Mar 18, 2018 1:21 PM Message:
All responses give good suggestions and rationale . Thanks Larry --107.147.xx.xxx |
Rental (by elliot [RI]) Posted on: Mar 18, 2018 2:14 PM Message:
Heck, we don't replace all knob and tube other than the basement/visible area.. It is just costly and unnecessary to break down so many walls/holes to replace them especially it is rental --71.232.xxx.xxx |
Rental (by Robin [WI]) Posted on: Mar 18, 2018 4:49 PM Message:
I have plenty of knob and tube. I run an extra circuit for the microwave and another for an electric stove, make sure I have GFIs for kitchen and bathrooms and call it good. Houses have been standing for over 100 years and haven't burned down yet... --204.210.xxx.xxx |
Rental (by Vee [OH]) Posted on: Mar 19, 2018 5:49 AM Message:
Larry you have only touched the tip of the landlord funzone, because you have probably downloaded and printed your local and state tenant rules already you know about the local housing court, a good way to pickup extra knowledge is to attend as an -observor- and you will hear many stories from both sides of the fence regarding the basic no pay - no stay idea that landlords must live by - but it must be done legally and in court is where the rubber meets the road with the tenant laws being the out of bounds marks, so after a few court learning sessions silently place your feet into the tenant shoes as she/he tells the story of why rent is not being paid at all or in part. Use the search feature here to help you gain perspective how some treat the near miss tenant/manager mishaps and as you have seen in court it is 12 months of March Madness (in a court with both sides trying to stretch the boundaries a bit while making legal shots to the hoops). --76.188.xxx.xx |
Rental (by RB [MI]) Posted on: Mar 19, 2018 6:33 AM Message:
Remember:
With Every Decision
The Woulda, Shoulda, and Coulda's,
Never Go Away. --47.35.xx.xx |
Rental (by BRAD 20,000 [IN]) Posted on: Mar 19, 2018 8:19 AM Message:
Larry,
It’s not your property until you close. The owner can do as she pleases.
Me? Two sides to this coin. I’d seize the opportunity to negotiate a discount because the CONDITION of the property has changed from what I made the offer on
BUT
I’d start my work on the vacant unit after closing. In real life, if you are replacing K&T you are punching holes in walls and adding all new wires anyway. This is the time to install separate meters and breaker panels. Get the first one up and running then convert the other when you can get in there. It’s awkward but not impossible when occupied. Consult your electrician and your inspector.l
Insurance: will your carrier cover a K&T house? Mine won’t touch it.
Have the new resdients moved in yet? Maybe not.
interesting dilemma! Keep is posted!
BRAD
--68.51.xx.xxx |
Rental (by Barb [MO]) Posted on: Mar 19, 2018 9:21 AM Message:
K&T is actually pretty darn safe because the wires are separated. Sad that insurance now dictates we can't have it.
Can you do the electrical upgrade with the tenant in place?
--131.151.xx.xx |
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