Monday, November 24, 2014

Virginia Maintencance Code Education

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1.) A Little Education on Virginia Maintenance Code - What Code Enforcers Can And Can’t Do. Direct Quotes From Their Bible

Some of this may be boring to you because it cites specific parts of code but much of it is important  as it outlines your freedom parameters as a landlord.

The Virginia Maintenance Code Dictates The Way Code Officials Operate. Take This Paragraph.

36-105.1:1
G. G. Exemptions from rental inspection ordinance. Upon the initial or periodic inspection of a residential rental dwelling unit subject to a rental inspection ordinance for compliance with the Building Code, provided that there are no violations of the Building Code that affect the safe, decent and sanitary living conditions for the tenants of such residential rental dwelling unit, the building department shall provide, to the owner of such residential rental dwelling unit, an exemption from the rental inspection ordinance for a minimum of four years.


There is a problem with enforcers searching properties over and over several times a year: If you have a property that has a valid rental exemption certificate it can’t be checked for any reason other than getting a call from someone that there is a problem there. It is exempt from a rental inspection for 4 years minimum.

36-105.1:1
F2. Periodic inspections. Except as provided in subdivision F 1, following the initial inspection of a residential rental dwelling unit subject to a rental inspection ordinance, the building department may inspect any residential rental dwelling unit in a rental inspection district, that is not otherwise exempted in accordance with this section, no more than once each calendar year.


The building department has the right to inspect any property in a rental inspection district at most once a year as long as it is not otherwise exempt (by rental exemption certificate). This law was put in place to prevent code enforcement from picking out people and harassing them. This was designed for protection of the people from rouge enforcers.

36-105.1:1
E. Provisions for initial and periodic inspections of multifamily dwelling units. If a multifamily development has more than 10 dwelling units, in the initial and periodic inspections, the building department shall inspect only a sampling of dwelling units, of not less than two and not more than 10 percent of the dwelling units, of a multifamily development, which includes all of the multifamily buildings which are part of that multifamily development. In no event, however, shall the building department charge a fee authorized by this section for inspection of more than 10 dwelling units. If the building department determines upon inspection of the sampling of dwelling units that there are violations of the Building Code that affect the safe, decent and sanitary living conditions for the tenants of such multifamily development, the building department may inspect as many dwelling units as necessary to enforce the Building Code…


There is a problem with enforcers knocking on all the doors of a multifamily house and trying to get in all of them when only one evictee called. They then give them legal advice and arm them for a court case against you: If your property has more than 10 units, enforcers can inspect a sampling of the units and if they determine that there are safety or sanitary related Building Code issues they can search as many units as they want. Code doesn’t reference anything under 10 units so they have NO right to search anything other than the unit that was called about.

36-105 - Relevant issues pertaining to enforcement of code, tenant complaints, the issuance of inspection warrants.

C. 2. Complaints by tenants. However, upon a finding by the local building department, following a complaint by a tenant of a residential dwelling unit that is the subject of such complaint, that there may be a violation of the unsafe structures provisions of the Building Code, the local building department shall enforce such provisions.


There is a problem with code enforcers continually citing properties that have a valid rental certificate with items that are not immediate and imminent hazards. This essentially says that if a tenant complains the building department needs to enforce code if there is a “building code” violation. Not "property maintenance" code violation. These are issues that are “immediate and imminent hazards". Not mold in the bathroom caulk that the tenant hasn’t been cleaning. Or a kick hole in the wall that the tenant made. The person IS going to die right away if something isn’t done is an immediate and imminent hazard. The Immediate or imminent hazard terminology is all over Virginia Code regarding this matter. And our politicians put it there to again, protect people from Rogue Enforcers. The definition of these words is crystal clear and there is no room for ambiguity.

36-105 C3 -  Virginia Maintenance Code
3. Inspection warrants. If the local building department receives a complaint that a violation of the Building Code exists that is an immediate and imminent threat to the health or safety of the owner, tenant, or occupants of any building or structure, or the owner, occupant, or tenant of any nearby building or structure, and the owner, occupant, or tenant of the building or structure that is the subject of the complaint has refused to allow the local building official or his agent to have access to the subject building or structure, the local building official or his agent may make an affidavit under oath before a magistrate or a court of competent jurisdiction and request that the magistrate or court grant the local building official or his agent an inspection warrant to enable the building official or his agent to enter the subject building or structure for the purpose of determining whether violations of the Building Code exist. After issuing a warrant under this section, the magistrate or judge shall file the affidavit in the manner prescribed by § 19.2-54. After executing the warrant, the local building official or his agents shall return the warrant to the clerk of the circuit court of the city or county wherein the inspection was made. The local building official or his agent shall make a reasonable effort to obtain consent from the owner, occupant, or tenant of the subject building or structure prior to seeking the issuance of an inspection warrant under this section.


So in the case of an enforcer going rogue and paying special attention to you, if you give them a trespassing notice you are essentially barring them from the property and not allowing access. In the bar notices that I have given it allows the enforcer to contact me or my contractor to set up an appointment to meet at the unit but not to step foot on it otherwise.

As you see in the code, if the owner OR tenant of the building refuse to allow the official access they can get a warrant. A legal process that our founding fathers put in place which still allows the government access to a property for pretty much any reason as long as the magistrate or a court has decided that they see it fit to do so. These are the same protections that people have from police entering their property. It prevents the bad ones from going rogue and is necessary in our society. Roanoke City Code Enforcers do not have powers greater than police officers as they think.

An enforcer has the right to inspect your property when a tenant being evicted calls and if you refuse by being forced to let them know that they are trespassing due to feeling that the enforcer is working against you than they have every right to follow the law and get an inspection warrant. The law clearly says the owner, occupant OR tenant. Any of the 3 not allowing access requires an inspection warrant. It does not say owner, occupant and/or tenant.
Legal disclaimer time: I’m not a lawyer.
2nd legal disclaimer: But I can read.

The code enforcement department seems to think that they have the right to enter your property even if you sent a trespassing notice to the enforcer as long as the tenant says OK. NOPE. The law is clear that any of the above says no and they can take their next step in the process which would be to get an inspection warrant which will require an immediate and imminent hazard to get.

The objective here is to always provide safe, clean and habitable housing for your customers. And in the same time prevent rogue enforcers from overstepping their scope of duty.
 

The Contentions Are:
1. That enforcers have no right allowed by law to inspect any property with a valid rental certificate without a complaint by someone. We were protected by these laws from rogue inspectors.

2. Another thing being that code enforcers have no right outlined by law to search any other apartment in a place that is 10 units or less if it has a valid rental exemption certificate in the case that a tenant being evicted called on a particular unit to get revenge. That unit ONLY can be inspected, unless there are further complaints by other tenants. They can’t approach the other tenants, that have no problems, demanding to enter their unit.

3. Another being that if the owner has notified them that they will be trespassing if they enter the property in an attempt to protect him or herself from the rogue enforcer, than the enforcer has the remaining option of an inspection warrant. And they have no option of breaking the law by entering the property regardless of the trespassing notification.

4. And that an inspection warrant is only justified if there is reason to believe that there are "immediate and imminent threats" to the health or safety of the occupants. Immediate and imminent threats do not include a tenant punch hole in the wall, a rip in the vinyl floor from them moving stuff around, etc.

Facts, Facts, Facts that  are denied by Roanoke City code enforcement. Sorry code that it doesn’t say what you want it to say.

Non Traded Real Estate Investment Trusts & Natural Gas Investing

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This week our guest speaker will be Andy Ingram from Capital Investment Companies. Andy will be with us to talk about their specialty in alternative assets that include “Non Traded” Real Estate Investment Trust’s and Private Placements. They have a robust offering in this area. He will cover the distinct advantages of owning shares in these assets due to how they operate under securities laws.

These strategies are not listed on the exchanges and are therefore, non-correlated to markets. The real estate portfolios can be Domestic, Global and Regionally specific in nature. Industrial, Commercial, Multi-Family, Retail, Technology, and Medical etc are examples of some of the core strategies involved. Andy will show us a few that are in their growth cycles and offer appreciation as well as distribution income.

Andy will also talk about The Oil & Gas Partnership that carries some very unique tax advantages that can offset earned and/or passive income. This one is truly unique and would be valuable to someone who believes in the opportunities in the future of Natural Gas prices and whom may have a tax liability problem in a given year.

Come on out to the meeting this Tuesday to learn all about private REIT’s and Natural Gas investment opportunities.

Stay warm, it’s looking like there will be snow this Thanksgiving!

Tuesday, November 18, 2014

Landlord Tenant Quick Reference Table

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Please see the attached table that was provided by REI attorney, Ross Hart. It is a very helpful table that serves as a quick reference guide prepared by Legal Aid in Richmond that will help you find various topics in all 3 landlord guides. the Virginia Residential Landlord Tenant Act. The Landlord Tenant Act and the Mobile Home Landlord Tenant Act.

Click on the picture and it will increase in size to see it.




Monday, November 17, 2014

REI Member and Friend, Jeff Owens Passed Away

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I’m sorry to announce that our member and friend Jeff Owens passed away yesterday. 36 yrs old… Way too young for a guy who had such a promising future.

Jeff was married to Nicole Owens (who owns the cake decorating company A Slice of Heaven). They have 2 small children, and his father was the owner of Owens & Co. Realtors which I'm sure you've heard of. Jeff had some apartment complexes over in Botetourt County and was a real good hearted fun guy to hang around with.

If his picture doesn’t jog your memory, he was the one that helped me with asset protection overseas meeting that we had about 3 meetings ago. The one that has experience with Ecuador and was planning on moving there in a couple years with his family.

Jeff will be missed!

This Week Ladies Night At REI

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This week our special guest speaker will be Leslie Mitchell of Damsel in Defense. She will be talking about safely conducting business as a female Realtor and or Landlord.

Her company has products available and she is going to teach you how to use them. The safety products they market are all inexpensive and can be a business write-off. There is also a GPS tracking app for your smartphone that is essentially a panic button that can do a number of things if you feel unsafe that she will teach you about.

Leslie will be demonstrating hot to use items such as pepper spray, personal alarms, stun guns, etc. Any of you guys want to be the test subject on that stun gun just let me know. Nothing like a good jolt of electricity to wake you up. LOL. I think I’m going to have to bow out on that one.

If you order something you can have it shipped to our member Carla Bream. If shipped there you won’t have any S&H charges and Carla will bring your order to the following meeting.

http://www.mydamselpro.net/LESLEYMITCHELL/shop/EVENTHOME.aspx?eventId=E42070&from=MYEVENTS

See you at the meeting!

Thursday, October 16, 2014

REI of Virginia University This Week

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This week at REI, our guest speakers will be members and friends, Spanky Macher and Jamie Bailey, who will be hosting an REI of Virginia University brainstorming meeting.

Last year we did a group flip and were unable to allow more than 6 people to be part of it even though there were many more who wished to  be included.  When all was said and done we all made a nice profit.

At this meeting we will be discussing a potential of doing another modified version of this money making program and offering training to members on how to fix up a flip property.

The purpose of the meeting is to determine desire for both getting involved in another group flip with very little down and to see if there are people within our membership that are interested in learning how to rehab real estate. An extremely valuable skill. It doesn’t matter if you ever physically use it again, you will make money by your knowledge.

Knowing what various aspects of a rehab take to get done and how long it takes to do it is invaluable as it arms you with the needed information to protect yourself from contractors pulling a fast one on you and charging you an arm and a leg for a simple easy job.

Another objective of this meeting is to outline how the whole thing goes down. Who gets paid what, how many investors are needed, what type of flip house in what kind of neighborhood, what benefits the wholesaler to bring a deal to the table, what does the project manager get paid and whoever takes the roll of the treasurer, what is the cost to those who will enroll in REI University and how much does the instructor get paid for their time? Lots of questions to get answers for. It’s going to be a fun project! 

Those of you who have never done a flip before and are only involved in an investor capacity will also have a great opportunity to learn from people who have been there and done that by watching at the sidelines.

If you potentially have an interest in learning to rehab property, don’t miss this meeting. The education will be priceless from people who are currently or have been in the trenches. And allot of this stuff is hard to learn on your own because when you get a job in plumbing, electrical, framing, etc., you end up begin the man on the bottom of the totem pole if you’re a novice so it’s hard to get the one on one training to actually learn the ropes.

Those of our members who already know the ropes in various trades, please be sure to come to the meeting and if you can’t make it please contact one of the 2 above to participate as an investor, instructor or both. We’re looking for people with skill sets in all forms of construction. Framing, electrical, hvac, plumbing, siding, flooring, landscaping, roofing, you name it.

Roger and I are headed out to Belize soon and will be gone for a while so I’m writing this email to you a little early. So don’t email me regarding this project as I will not have access to this email address from Belize. As of now the following week is open which could mean that it will be one of our moderated forums which are always educational. Or it could be a follow up meeting to the upcoming REI U meeting.

Those of you who are interested in getting involved in this very low investment flip, But can’t make it to the meeting… please contact Spanky or Jamie.

I happen to know that there are a number of people that wanted in on that last deal that have never been to a meeting. You’re more than welcome to participate in any capacity.

Discussion will be Tuesday 10/21 at Shakers from 6:30 to 8’ish

Monday, October 13, 2014

Mental Arm Wrestling At REI This Week

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Ladies and Gentlemen…. ding ding…. I would like to introduce our President, Andy Stowasser, and our CEO, Roger Malouf for an educational meeting with you this week teaching the most valuable skill of Mental Arm Wrestling, AKA, Negotiations.

The big difference between physical arm wrestling and mental arm wrestling is that the little guy or gal can actually win!!!

Negotiation is a part of your every day life. More so in other countries where haggling for a price on everything is a standard of life. Some people don’t like it. They don’t enjoy the game of haggling. I’m guessing that the reason may be that they don’t feel like they typically end up winning this game of the minds as a result of not being trained in this most essential skill.

It’s important to fully understand and comprehend the basic principals of negotiations in order to be able to look at the big picture of any situation and be able to determine what angle you will take to fulfill your primary objective. Which in the case of getting deals in real estate would be to obtain the property for the rock bottom lowest possible price. Or the other way around, to sell your property for the highest possible price.

In doing so one of the most important parts of the equation is for both parties to be happy with the final agreement.

Come on out to our meeting this Tuesday to get a walk through on the principals of negotiations so you can clearly see the roadmap on how you get from point A to point B with the result you desire.

Don’t Miss It! - Be There Or Be Square… and prepare for a good sized turnout.

Wednesday, October 1, 2014

Tips On Using Untested Vendors.

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For your information. We DO NOT typically do background checks on any of the speakers that we have that attend our meetings. Some of them are there to sell you services. It is advised that you do your own background check on these individuals before using them. Or get some good referrals.

REI IS NOT RECOMMENDING ANY of the people that we have come speak at the group. We allow them to come and educate us on their line of work.

Members have had problems with group speakers in the past. For example that guy that came a year or so ago to talk about collecting money on judgements. Shortly after he took money from some of our members and they never heard from him again.

There are ways to do business with people and keep them on the up and up. Be smart. You’re best off to never prepay for ANY service. And if money is required for materials, or court costs for that service, you can directly pay for those materials or court costs. In the example of court costs, you can write the check directly to be cashed by the courthouse rather than those who are providing the service. Or with materials needed for a job, you can have Lowes or Home Depot call you and you give your credit card over the phone if you don’t have the ability to go down there to pay.

There’s no problem with lightening up some once you have deemed the company you are working with to be honest and reliable.

Sooo,

DONT prepay for ANY service.

DONT hand over ANY money for materials or costs of doing business until you can trust the person. There are other options for continuing business other than putting that money in their hands.

Street Smarts… Unfortunately that is the world we live in today. American Culture is changing for the bad. There are MANY people out there trying to get one over on you. You have to protect yourself by using some basic ground rules of doing business. You’re the one who dictates how it will be handled and if they have a problem with that they can go find another sucker.

Tuesday, September 30, 2014

REI of Virginia ~ In The News

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Ladies and Gentlemen, our new Public Relations Officer, Jeff Schmucker, wrote an article and successfully got it published in both the Roanoke Star and the Roanoke Times. See the links below.

Roanoke Star

Roanoke Times

Please comment on the article at the bottom of it. It’s important to get a few people on our side responding to help sway public perception of landlords in a positive manor.

Monday, September 29, 2014

Get Your Money, This Week At REI

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You provided a service. A safe clean environment to live in. A roof over their head. They bought that service from you and signed a contract between you and them that they would pay for that service for a given period of time.

When you met them they instantly seemed like great people to do business with. You did a background check on them and everything was A OK. They meet your criteria.

Then one day… months down the road, one of a few things happens.

A. They take the high road and they tell you that they lost their job and are going to either move right out and in with some friends or relatives before rent comes due so you aren’t having to pay the mortgage, insurance, taxes and everything else with no income coming in.

Most people don’t take this path even though it is the most respectable, moral and ethical path to take.

In this situation, in most cases, I wouldn’t even take the person to court. I have a heart and if someone is down and out and quickly steps up to the plate while thinking about my situation as well, I’ll let them slide on the contract.

B. Another possible avenue residents take is to lie to you and say their car broke down. Or the lights are getting cut off so they mistakenly choose the light bill before the shelter bill. Or they just lost their job, and maybe they did. But you already saw that brand new living room set in their house and you are the one that told Rent A Center that they pay their bills on time when they called for verification. Maybe that was a bad idea on your part. Or when they were telling you about the awesome time they just had in Myrtle Beach while letting you know that they are short on rent funds. Or maybe like we will be dealing with in a couple months. That they chose to spend rent on Christmas and they know that that isn’t a good excuse so they fabricate a story that may fly.

This angle gets my residents lined up with a court date. In this case I will fax in a letter to the court the day before to continue it if, and only if, the tenant is working hard to get back out of the hole they created. Weekly payments are required. Whether the story they told me is true or not. It doesn’t matter because I have a date that I am required to file papers on all delinquent accounts and I have no other option. However I am more than happy for them to stay if they hustle and get their account back in good standing quickly. And I will give them the time to do so through 2 week continuances. The minute they drop off the new agreed payment arrangement is the same minute I decide to follow through with the upcoming court date. I have found that this method that Dan Cullather showed me, works very well.

C. Now here is the 3rd possible angle that people take. You really seemed to hit it off with these people. Every time you see them you have a nice conversation and lots of smiles. They are just good all around people.

Then one day, months down the road. You haven’t received their rent and you called them and text them with no answer. You go by the house to see if they are Ok and they open the door with a nasty mean spirited look on their face and say “What Do You Want”. You ask them if everything is Ok and they tell you that you are a slumlord and they are sick of living in these conditions that you have put them in.

For these types of people, you’re a slumlord is keyword, I have no rent money for you and no intentions of paying you rent. It also spells out that they intend on holding up the fort and you can go ahead and evict them because they will lock it down right up to the day the sheriff comes to the door.

So you ask what is it that is wrong with the place. They scowl at you and tell you that there is black mold all over the place and their child is getting sick. And the sink is dripping water. And there are roaches in the house that they didn’t put there. The neighbor moved out and they all ran across the street and moved in. As if roaches are attracted to people that aren’t feeding them. They tell you that they are done arguing with you and slam the door.  And you’re standing there wondering how it was that you were arguing when you were simply asking what the problems were.

Man, those are the ones that really give tenants a bad name. I have allot of low income properties so I end up having some nasty ones like that every year.

After the sheriff gets there you find out that they were right. There are roaches everywhere. So many that it’s going to be very expensive to get rid of them. They have been feeding them for 6 months. The sink is dripping. Like one drip per minute. And there IS black mold. ONLY in the shower caulk. They were filthy pigs and clearly never heard of Tilex. Or any other bathroom cleaning chemical for that matter.

Your house is now trashed. They left garbage and junk furniture all over the place that you have to pay to get rid of. You have a couple holes in the wall that they punched on their way out to deal with as well. And can tell that there will be no touch up painting in that unit. The whole thing is going to need to be completely redone.

So now what do you do? Well… it’s payback time. You can get your judgement but just doing that and nothing else is useless. A judgement isn’t worth the paper it’s written on if you don’t attempt to force it to be paid. You better hope at this point that you were good with your records because if you were and kept information and always paid attention to where they were working you now have the option of jumping through the hoops of getting their wages, bank account or other personal items garnished.

But that’s allot of work and you are now tired from all the drama. You are ready for this to just be over. So you take the easy route and give all the information you have to our Tuesday night speaker, Alvin Franklin of TJR Asset Recovery. Alvin has been jumping these hoops for years and has recently opened his shop here in Roanoke Virginia. And he won’t charge you a dime of money before he collects. Obviously if he found them and needs to take them to court for you than there are court costs, but there will be nothing in his pocket until he starts putting money in your hand.

Cancel your plans. Come on out this week to get the details on this program he has set up for REI of Virginia. No need to chase after bad money yourself. Most of it won’t be collectable anyway. Let him do the legwork and find out what he can get for you.

We’ll see you there this Tuesday! Hopefully we have the big room because I suspect seating will be limited. Get there a little early. Don’t miss it…

Monday, September 22, 2014

The Most Important Thing You Need To Be Concerned With In Our Industry

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Good credit is essential in our industry unless you are already in the multi millionaires club and don’t intend on borrowing money. You can be a real estate investor with bad credit and little money but you will have to depend on very high interest loans or do something like wholesaling and assigning the title where you never take name to it.

It certainly makes things allot easier if your credit score is at an excellent level where the banks and private lenders want them. This opens options that you would not otherwise have which can be extremely beneficial in growing your business.

This week our special guest speaker will be Chuck Conlon of Credit Technologies. Chuck is an expert on the details of a credit score and what is needed to be done to spit shine it and have it looking good from a lending perspective. This can help not only you but any FSBO buyers you may have.

He is going to talk to us about credit in general and the services his company offers. He also has a service available that allows Realtors to determine before even showing if prospective buyers are qualified. And to authenticate the identity of prospects before setting up viewings or private meetings. They can even help Realtors attract more potential buyers and listings so you can sell more homes.

They also have services set up for mortgage brokers and he is already working with most in the state.

Come on out and learn all about the in’s and out’s of credit.

We’ll see you there!

Monday, September 15, 2014

This Week Syndicated Radio Talk Show Host Of The Program Financial Safari

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This week our special guest speaker will be Monti Smith, a talk show host for the nationally syndicated program, Financial Safari.

One of the most important things you can do is to set your assets up so your loved ones will get what you pass along to them without the government and lawyers stripping away your wealth in probate.

Monti has focused her financial planning practice on income planning, asset preservation and legacy planning for pre and post retirees.

Come on out and hear what Monti has to say about the right way to protect your money and belongings for future generations.

Monday, September 8, 2014

Something A Little Different That We Haven’t Seen Yet…

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Hi Everyone,

This week we are going to have guest speaker Jeremy Vogan from Countryside Service Company, LC. He will be talking about something a little different from which we typically see.

Jeremy called me about a month or so ago wanting to present a real estate related business opportunity to our group. From what I understand, this company is a large builder who had spec homes for sale and got caught holding too many when the bottom dropped out.

Essentially what they are doing is unloading all of their property in a creative and unconventional way. The sales price of these properties is set at full market value. What they are offering is the ability to owner finance them with only 10% down.

They then act as the property manager and continue to work with the tenants in the currently leased house so it’s a hands off investment for you.

REI is not endorsing these people. We are simply letting them come and offer their product and services. You have to do your own due diligence and determine if it is a good investment for you or not.

Things to consider would be:

Will the property cash flow? If not what would you have to chip in to cover the mortgage to them with only 10% down.

Are you rolling the dice on appreciation only or will this be a solid investment that you will profit from?

What kind of contractual agreements can be thrown in to sweeten the deal to make these properties at least break even so they can be paid off over the years by the tenants. Possible suggestions would be no cost property management, no cost maintenance, etc.

Come on out this Tuesday. This should be an interesting meeting.

Monday, August 25, 2014

This Week At REI We Will Have An Open Forum

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This week at REI of Va we will be having an open discussion. These meetings are often full of great information. This is a time where questions and comments can be made about any aspect of Real Estate Investing. All topics of discussion are welcome. Beginner to advanced.

The topics of discussion will pertain to subjects such as Rehabbing, Landlording, Property Management, Wholesaling, Obtaining Financing, Crowdfunding Real Estate, Terms on Creative Investing, Asset Protection, Marketing, Tax Issues, Property Insurance, Investing in Real Estate Outside the US, etc.

There is a whole world of real estate investing to be explored that our group hasn’t even touched on. Come on out and bring your questions and knowledge to share.

Tuesday, August 12, 2014

Home Depot Wants REI’s Business

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In common conversation I have learned that the vast majority of our membership goes to Lowes for their building materials. Home Depot has been pulling some of us away due to their offering of 20% off on paint for our membership.

Lowes in turn offered to match the 20% discount on paint to REI members.

Now Home Depot is coming to our meeting this Tuesday to step it up another notch and let us know what else they can offer our membership since we like discounts. 

Come on out to the meeting this week and learn what needs to be done to get your discounts at Home Depot. Every dollar you save is a dollar earned. REI feels it is important to use the buying power of our 550 members to get the products we need at the best price.

If you are not already signed up for the many other companies that we get discounts through go here. We already paid for your membership. If you subscribe to this email you are eligible to get your discounts.

Click Here: Community Buying Group

Monday, August 4, 2014

How To Collect Money Owed To You Through Garnishments

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This week our guest speaker will be Attorney Darren Delefield. Darren will be at the meeting to talk about the various types of garnishments that a landlord can do to collect bad debt. We’ll cover wage garnishments, bank account garnishments and personal property garnishments.

Come and learn the most important bits of information that you need to obtain on your rental applications so you have all of the information needed in order to get paid in collections. Then learn what you can garnish and how to file a garnishment to get your money.

Go ahead and cancel any plans you have as this is a meeting that will make you money. Hopefully we have the big room, if not you better be there early to get a seat. I see many have to leave on nights that I expect a big meeting and we get stuck with the little room. The meeting starts at 6:30 sharp.

See you there!

Monday, July 28, 2014

Stone Veneer For Your Rehabs

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This week at REI of Virginia we’re going to learn about using stone veneer in your rehabs. A company named M-Rock Stone Manufacturing out of West Virginia will be coming down to talk to us about their varied stone veneer systems that are super easy to install. NO MASON NEEDED. If you can use a screw gun you can install it.

These stone veneer systems can be used for both exterior and interior applications such as fireplaces, backslashes, bars, columns and other accent pieces for your home or flip. This is that extra touch you need to knock that flip out of the park.

I’m already thinking about an ugly fireplace I need to hide in my rehab in Glenvar.

Come on out Tuesday night and spend some enlightening educational time with good like minded people.

We’ll see you there!

Wednesday, July 16, 2014

Hometown Flooring, Beware

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 (Commentary)

Warning to all REI Members. Be careful of doing any business with the guy Chris from Hometown Flooring that came to our group.

I suspected there were issues with this guy when he came to the meeting and had a hard time answering very simple questions pertaining to flooring installation. Then later after the meeting I was asked by a few of our members who invited him to speak. I asked why and was given detailed explanations of how this guy got one over on them over and botched flooring jobs so bad that the entire floor had to be ripped up and redone. That was after he blamed it on the structure of the house.

Let me tell you, I installed flooring for years and I can tell you that the structure of the house has nothing to do with it. If there are imperfections in the floor they are fixed before the new floor is put down.

I didn't bother saying anything about this guy to the group because someone obviously got some good work done by him since they recommended him. And people can make mistakes from time to time. But now I am hearing the exact same thing again. This is the second person in the past month that has told me that he has unresolved issues with their floor. This last report pertained to a tile job that had gone bad and the Chris guy claims it's due to something wrong under the tile that he didn't fix before laying it.

Below is a response from Chris that he gave to our member about her friend that also has unresolved issues. For no apparent reason this guy is saying the REI group is full of slumlords. 550 slumlords? Really?

"In regards to (Name Removed) I tried to go the extra mile and did not charge her for many things that needed to be fixed during her kitchen remodel. Im not going to beat a dead horse but there were MANY changes made during this process. I could list a page of things wrong with her electrical, and whoever built her house. There are two sides to every story. I try to make sure that every customer is happy and I have realized over the years that you cant satisfy everyone. (He is right about that but the number of complaints that I have received about this guy shows he very well could be the problem)
As long as I know I did my best, thats all I can do.
In refference to the REI Group, I spent a day measuring 6 houses for someone, gave them estimates the next day on every house, then they tell me Home Depot will install a whole house for $49. I consider this a slap in the face when someone tries to use a shaddy sales pitch from another company in hopes to beat down my prices. I refuse to do work for slum lords and I feel there are many in the REI Group." Wow, what nerve this guy has! As if he knows any of us other than who he did estimates for.

Monday, July 14, 2014

Is Your House Losing Energy And Money?

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This week at REI of Virginia it’s all about consumption of energy. As you know money saved is money earned. It all comes down to what it will cost you to make your house more efficient. And what the ROI of the products required will cost you to save X number of dollars. Basically how many years it will take to recoup your investment. From that point on it’s all gravy.

Our guest speaker will be friend and REI member Jerry Eastridge. Jerry does energy audits as one of his many talents. And he is an expert in the field.

I’ve been really interested in this topic over the past few years. I’ve been working on getting my new house I’m rehabbing in Salem highly energy efficient. And I’m most of the way there. I’ve got open cell foam sprayed throughout. Basement, attic roof and all exterior walls are sprayed. 

Along with that we’ve caulked the crack everywhere between the floor and the wall and spray foam and caulk around every window and door. I didn’t seal around the electrical outlets because I’ve been told I don’t need to because of the foam.

I’ve added a device connected to my breaker box that smooths out the electrical waves traveling through wires which reduces heat in wires and motors of appliances. Heat is lost energy. A guy who came to our group a while back was selling his for about $1,200. He proved it worked. On average it saves 10% on your power bill. He decided to give me a deal at $1,200. When we were talking he put an X on the $2,500 and wrote $1,200. LOL. I had to turn him down because I found the exact same thing here for much less.

http://www.ebay.com/itm/Electric-Saver-Power-Factor-Save-Electricity-KVAR-1200-/390144826453?pt=LH_DefaultDomain_0&hash=item5ad6719c55

He also was selling a laundry product that you don’t have to use detergent due to ozone being mixed with water which produces hydrogen peroxide. Remember his stack of towels that were washed with detergent and his other stack washed with the ozone product hooked up?  I found that product for much less than the $2.5K he wanted for his here. I ended up having to let him know that I found it cheaper and he matched the price saying at least that will pay gas money for coming out here. LOL.

http://www.ebay.com/itm/DEMO-HIGH-Water-Flow-O3-Pure-Eco-Laundry-Clothes-Washing-System-Ozone-Generator-/131236749451?pt=LH_DefaultDomain_0&hash=item1e8e51e08b

I couldn’t find an equal product that killed all bacteria in ductwork. His produced plasma as well as UV light. I bought his product but here are some that are similar minus the plasma.

http://www.ebay.com/itm/Air-Purifier-whole-house-UV-Light-in-duct-for-HVAC-AC-Duct-Germicidal-Filter-/281385325599?pt=LH_DefaultDomain_0&hash=item4183df541f

My next steps are to get my friend Jerry out to my house for another energy audit to make sure that I buttoned everything up. Then I will move on to some more fun stuff like a solar hot water heater, solar thermal collectors which are very cool, a micro hydro system in my creek to produce 24hr power, a hydraulic ram pump like the one CB Knox brought to our meeting to get powerless water up to my chicken shack.

One day I’ll be off the grid completely. I’m going green guys. And having fun with it!

It’s all about you this Tuesday. Come on out to the meeting as we’ll be talking about ways to keep money in your pocket. 

See you there!

Monday, July 7, 2014

How To Fill Out A Summons For Unlawful Detainer

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I have been asked a number of times from novice landlords how to evict a tenant who is not paying their rent. 

First you give them what is called a 5 Day Pay Or Quit Notice. The Roanoke City courthouse says that notice is sufficient if it states something to the effect: Date, Name of Tenant and that they are behind in their rent by whatever amount and you are giving them a 5 days notice to pay that amount or you will terminate the rental agreement and seek to have them evicted. You also need to sign the pay or quit notice.

You can either post that notice on the door of the unit or you can mail it to the tenant. Standard first class mail is acceptable.

Send me an email and I can give you a copy of my 5 Day Pay Or Quit notice if you want something specific. If you don't have my email address you will need to sign up to be on our mailing list in the top right of this website. I don't post my email address on this website because that leads to spam bots picking it up.

Click on the images below. I am attaching a copy of a filled out unlawful detainer. It includes the wording from our attorney Ross Hart who suggested a great way to ensure that you can get a judgement for any amount that is due no matter when the final court date is. If you are a novice landlord you probably don't understand why this is required under the automatic assumption that you naturally would get everything you are owed however this is not always true.

Other things you may not understand:
* 6% DOJ means you are asking for 6% interest from the Date Of Judgement
* As of today, July 2014, your court costs will be $48 for the unlawful detainer. Then another $12 dollars for each and every person you evict that pays the sheriff to serve the papers. That adds up. If you use a process server such as Paul Yengst, he charges as of today $10 total no matter how many people you are serving. That's why I have $58 listed in the line before costs. If you are using a process server you have to write their name on the Unlawful Detainer so they know to give it to them and not charge you the sheriff fees.
* I always write Reasonable in the attorney fees area. If the tenant contests what they owe you and you have an LLC you will need an attorney to come back with you for the contested date unless you are there just as a witness. Reasonable allows the judge to award your attorney what they see as fair.
* Notice that I wrote any and all other occupants next to the persons name I am evicting. This is important. If the tenants moved in some other people that you don't know about or don't know their name you have to use this statement. Otherwise if they do not leave after you got judgement, the sheriff will come to the house and ONLY kick out the person you evicted. You will likely have to go back to court again to kick out the remaining people as the police often aren't concerned by people trespassing in your house if they were invited there by the former tenant. Sometimes they pick and choose which laws to enforce and when it comes to the supposed Rich Landlord laws often fall to the side.





































This Week We Will Be Diving Into The Unknown!!!

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Ladies and gentlemen… This week, at REI of Virginia, we will be diving into the UNKNOWN!!! Literally. I have no idea what we will be talking about. It is unknown. Probably won’t be known until it is actually happening.

But it will be fun. We always have a good time and end up having a highly diverse conversation when we hold a group forum.

We’ll see you there!

Monday, June 30, 2014

There’s Money In Commercial Real Estate

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For so long we’ve focused primarily on residential real estate investing. This week we’re going to start digging into the possibilities of investing in commercial real estate. There are so many different types of commercial investments and each has it’s own particular skill set to own and operate in a profitable manor.

Commercial real estate typically includes things such as large multifamily, office, industrial, warehouse, retail, etc. Each of which has it’s own special ground rules to be a successful investor.

Our member and good friend, Frank Martin, will be leading a discussion on commercial investing and he promised to bring some numbers to the table including things such as what you would expect to pay for various types of commercial property and what rents you would expect to get on these properties.

We all know it takes allot longer typically to rent a commercial property but these commercial tenants most often stay much longer. You also don’t have the headaches of tenants calling and complaining about this or that being broken as commercial leases typically require the tenant to fix all maintenance issues with exception maybe of the exterior walls and or roof.

There are some downfalls to commercial landlording, however, there are many benefits that make up for it. The path that I have seen many successful investors take is they get started in residential investing and at some point in time or another they end up switching over to commercial investing due to it being much easier to manage. Then somewhere further down the road their pockets are fat and they own an empire.

That’s where I’m going. My wallet is already full…  Now I need a clear and concise, risk free roadmap from point A where I’m standing directly to point B.

Come on out to the meeting this week to get your toes wet in commercial investing. Over the next year we are going to continue to dig deeper in these areas of investing. REI of Virginia plans on giving you the expertise so if a commercial investing opportunity presents itself in the future you will be armed with education to make a wise financial decision.

See you there!!!

Monday, June 23, 2014

Becoming Your Own Banker At REI This Tuesday!

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There are many benefits of using a bank to finance deals that will in turn over years make you very wealthy. Believe it or not, the less money you have in a deal, the higher your ROI or cash on cash return will be. Sounds strange but it’s true and I can prove it.

However no one with a minimum of two brain cells to rub together would over leverage themselves as that is always a house of cards that will in time fall. I’ve seen it happen many times.

In the process of making yourself wealthy via the bank loans you are also making the bank very wealthy as “compounded” interest averages to be quite a bit higher than it initially sounds.

Our CEO, Dan Cullather and I have been talking about a book he has been reading regarding being your own banker. He introduced some very interesting concepts to me that he will be sharing with the group.

Cancel your plans if you have any because you don’t want to miss this meeting. Hopefully it will be in the big room so people aren’t turned away from a lack of adequate seating like last week.

Be there or be square…

Thursday, June 19, 2014

Chronic Complainers - An Adequate Representation Of The Neighborhood?

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Every neighborhood has one. A chronic complainer.

It can be very tempting to ignore a complainer as they eventually become irritating and it's human nature at that point to withdraw from an irritant.  But believe me, you ignore complainers at your own peril. That's because complainers really are suffering. They're not suffering from the superficial stuff about which they're whining. They're deeply deeply wretched human beings who, when ignored, will feel driven to clamor even more for attention, because they're feeling misunderstood.

People who complain a lot generally are not the kind of self-starting, take-care-of-business, solve-the-problem-pronto people with whom we want to work. Expecting them to be that would be an exercise in futility. It's best to appreciate them for what they do well, and know that they won't ever be a truly supportive team player.

Unfortunately I am incapable of doing so. When I get nasty abusive voicemails on my phone about my tenants or properties, I most often block the caller from contacting me. Next time they call they hear the "do, dooo, dooo, this number you have called is not in service" message from Google Voice.
 
I prefer to talk to people in an educated positive manor as that is what motivates me to work together for a good solution.

Know also that chronic complainers can bring down the atmosphere in an entire neighborhood. The negative atmosphere leads to blight as it leads to people keeping their property at a substandard level and not caring about what happens in the surrounding area. It's very important for neighborhoods to understand that this type of negative behavior creates an undesirable outcome and neighborhoods should consider stifling the complainers who are speaking on behalf of their organization and replacing them with positive proactive speakers who understand how to move a neighborhood forward.

A quick background on myself. I served a 3 year term on Roanoke Neighborhood Advocates because I do have a passion for owning properties in up and coming neighborhoods as that leads to high sales prices in the end game. I buy in neighborhoods that have made that first turn that I can see positive progress in the future.

I specialize in boarded up houses. I like to make the most radical difference to a neighborhood that I can bringing a F grade property up to a B. I don't take a property to an A flip grade. That's not my forte and there is no economic advantage of doing so until the neighborhood has taken a full swing which takes years. At that point it makes since to fix a property up to flip quality to sell it and buy 4 more in the next up and coming neighborhood.

My B quality property is far and above most owner occupied property in the neighborhoods that I buy in until the point where they have finished the final turn into a grade A neighborhood. The Mountain View Neighborhood is still a ways off from being a B grade neighborhood.

All of my properties have a valid rental exemption certificate as they are kept in good working order. They also pass Section 8 inspections and insurance inspections. All properties are "fully in compliance" with the law. Landlords have very rigid requirements in Virginia that owner occupied property is not subject to. All of my properties are well "above minimum standards."

I'm posting a voicemail that I received from one of these fringe complainers that got blocked from calling my phone due to an inability to speak to me in a professional manor.

A few points to make:

1. A boyfriend, not husband, of a tenant of mine that was drinking and hit his girlfriend. He is not on my lease and the female tenant let him come over. After he hit his girlfriend which was in front of another one of my tenants, he refused to let either of them leave the house because he didn't want them to call the cops on him. Yes, stupid guy. His charges were abduct by force / intimidation. The complainer has all of the details wrong saying the "White" girl was locked in a closet. What's up with the "White" thing anyway, is he racist? What does the color matter for? Is there a reason for that bit of information? The "white" girl was drinking with both of them as they are friends.

2. The female tenant on the lease had a background check from us, as all tenants do. And she is fine. I have not "chosen" to make the neighborhood suffer as the caller says.

3. Those tenants are not new to the neighborhood, they have been living in another house over there for years.

4. I support all neighborhoods and never "try" in any way to harm them by moving in people I don't completely think are good for the neighborhood.

5. Does this ******* think I live in South Roanoke or something? I also live in a bad neighborhood. As a matter of fact mine is much worse. I live behind the rescue mission. The caller states that I would never allow this to happen in my neighborhood. As a matter of fact, the house right next door to me just got shut down as it was found to be a crystal meth lab and the police were at it every day for months. The landlord that owns it is one of our members. No way would I think that he was TRYING to ruin my neighborhood. It's not easy to get these losers out once you have found that they turned a new page to crime.

6. I WILL NOT be evicting the female tenant from the house. She was the victim of a crime. She WILL NOT be going anywhere. Complainer is trying to get me to break the law. Maybe he will read up a little regarding the rights of a victim in a domestic violence situation and what a landlord can and can't do. Corbin, I'm calling you out right now. I WILL NOT break the law for you. She is a victim not a criminal.  I DEMAND that you go back in your hole...

7. Listen to his tone and choice of words. It starts out good and gets really nasty as it goes on. I'll bet he didn't know that my voicemails are public information. The house in the picture is my supposed substandard housing that he can't get rented. Don't bother anymore man. I've been told that you are known for stealing deposit money anyway.

Corbin Prydwen - VP representative of the Mountain View Neighborhood Association: Let me make myself clear. I do not think the rest of this neighborhood association (Other than the Jim guy who works at Lowes) backs Corbin in his unprofessional attitude. I know many of them and they are good people. Corbin just became the VP and is now drunk with power. Guess what buddy? I could care less what you are!



Monday, June 16, 2014

Landlord Tenant Expert Attorney Ross Hart On New Legislation You Need To Be Aware Of

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This week at REI we have one of our favorite entertaining speakers, Ross Hart. Ross is an expert at landlord tenant issues and he will be talking about new legislation that will be coming around the corner this July.

There are some changes that have been made to the landlord tenant act that you need to be aware of. Ross will cover these topics so you understand what is required and keep yourself out of hot water.

Below are some of the topics of discussion:

1. If you have 3 or more properties our politicians have decided unanimously that you are now subject to the landlord tenant act.

2. You now can get a fine if the tenant pays off a judgement and you don’t notify the court.

3. New boarding house laws that could allow you to rent a single family house of up to 8 people under certain conditions. Currently the city says no more than 4 unrelated adults or a family plus 2 unrelated adults.

4. You can now amend your unlawful detainer if the tenant doesn’t show up to court to add more damages, more rent, etc.

5. You can now bill a tenant for local government fees if you have it in your lease. So when the government sends you the rain tax you can have that tax added to their rent. Or when they send you a bill for the tenants trash etc, it gets billed as rent. We really need to talk to Ross about this one. Lots of possibilities here.

6. Now, if you didn’t take the tenant to court, and they still owe you money, it is now legally owed to you without the judge saying so. So it is now OK for a collection agency to go after them without a judgement from the way I read that bill.

7. Now the estate of a dead tenant owes any damages to the unit or back rent, etc. 

Good stuff people!!! I’ll see you there…

Monday, June 9, 2014

Learn All About Prepaid Legal Services From Legal Shield This Week At REI

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This Week our special guest speaker will be member and friend, Eliane Niemann. Elaine works with Legal Shield which is a prepaid legal service.

They have small business services which include:
* Legal Consultation on unlimited matters
* Business law expertise
* Contract and document review
* Debt collection assistance
* Legal correspondence &
* Trial defense services

I am interested to see what limitations there are with the service. Especially in our industry considering the fact that we use legal services frequently.

Come on out to our weekly meeting and spend some time with good like minded people.

See you there!

Monday, June 2, 2014

Roanoke City Treasurer Evelyn Powers At REI of Virginia This Week

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This week our guest speaker will be the Roanoke City Treasurer, Evelyn Powers. Evelyn is concerned with some of the things that have been going on in the city and offered to come and speak with our group.

Her job as treasurer is to maintain the highest accountability of local and state revenue collections. Unfortunately their have been a number of shady things that the city has been doing lately with the management of their finances.

It is commonplace these days for the city to hide the fact that a property is destroyed or has to be converted to a single family house and novice investors unknowingly fall into their trap. Or to sell million dollar tax payer owned buildings and land to friends for $10 bucks. Corruption has reached a shocking level within Roanoke City government.

They have developed a hostile environment that attacks small business and drives them out of the city to invest in the surrounding areas which lowers property values due to a lack of supply of people wanting to invest their money in the city’s blighted areas. All citizens in Roanoke City suffer as a result of the policies of the city leaders.

Evelyn will be attending our meeting to give us her ear and work together with us to hopefully resolve some of these issues. 

She is there on our side. Not against.

Come on down, it will be a fun meeting!

Monday, May 26, 2014

Self Directed IRA’s This Week At REI

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Our educational entertainment this week will be all about Self Directed IRA’s. And our guest speaker will be Kevin Miele. If done correctly, there are ways to take your self directed IRA and purchase investment real estate with it with a company that you control.

Come on out this week and get the details on what you can do with a Self Directed IRA!

REI Member John King Tackles A Massive Project

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Developer / REI of Virginia member John King has big plans for Cliff View, a parcel of land over by Lewis Gale Hospital. Good stuff John!!!

video platformvideo managementvideo solutionsvideo player


Monday, May 19, 2014

This Week It’s All About Renters Insurance

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This week we will have guest speaker Betsy Thomas with State Farm Insurance. Betsy will be with us to give us the details on Renters Insurance. It’s funny how I talk with landlords online in some towns where all of the landlords require renters insurance and others like Roanoke where it seems that very few landlords require it.

I guess we just haven’t been sold on the benefits of requiring it. In my lease it requires that all tenants get renters insurance but I haven’t taken any steps to ensure that they have.

I had a tenant one time that set one of my houses on fire. They denied starting the fire and said someone ran up to the house outside and started it. The fire started in the exterior wall and I suspect a boyfriend of the tenant started the fire who works as a volunteer fireman for the Hardy Fire Department. He was the one warming his hands on the fire when my upstairs tenants came down and saw it.

The tenant girl living in the house had the nerve to demand that I have all of her furniture professionally cleaned. I asked her where her renters insurance is since it is required in the lease. She freaked out and said that it wasn’t required in the lease and I told her to go read it. So that was the end of that discussion. Who knows if she sued me what would have happened.

I have also heard stories like this one from our members. There was a small leak in a member landlords plumbing. It was leaking into the basement. There was a very small puddle on the concrete floor. The tenant was subletting the house for storage by allowing a friend to store her furniture in the basement where the leak was. No water dripped on the furniture.

The tenant called a mold specialist in Roanoke and that mold specialist said that there is mold all over in the basement air and her furniture due to that little leak. The landlord had the leak fixed within a few days of being notified. The tenant sued the landlord and believe it or not, ended up winning based on that mold specialists scare tactics that were used to get a few thousand dollar mold remediation job done on the basement.

So, if the tenant had renters insurance, would the landlord still end up liable? I don’t know but what I do know is we should be able to get answers to questions such as this from Betsy at this weeks meeting.

So come on out and have some fun with like minded people in an educational environment.

See you there…

Monday, May 12, 2014

The Dirty And Potentially Illegal Tricks Roanoke City Government Plays On Unsuspecting People At Tax Sales

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Dirty Tricks People Play For The All Mighty Dollar

Roanoke City has a tax sale of real estate every 8 months to a year. I’ve attended every single one for the past 10 years or so and have purchased a few properties from these sales. I’ve learned allot of lessons over the years and the city has taught me that they can not be trusted and are willing to stoop to low levels that are shocking and most likely illegal.

It is important to expose this corruption within so those who are leading this city have an opportunity to resolve the issues and terminate the city employees who are taking part in this.

Below are a few issues that I have personally witnessed or have been a part of. I’m sure there are many more.

Sales Advertised With Guaranteed Clean Titles Are Not Guaranteed Clean:
Roanoke City advertises in their tax sales that they are giving you a property that has a clean title and is free of all claims. I purchased a property back in 2007 that had a serious title problem. Years before the property was sold with the wrong lot information, it was mixed up with the lot next door. Which means the person next door actually is the owner of the property. No title company would insure it therefore no bank loan could be obtained as a result of the title problem and ability for the next door owner to lay claim to the property. I contacted the attorney working for the city at that time and he told me that’s your problem and sent me packing after paying 35K for the property. So lots of money and work for my attorney and we were fortunately able to get a clean title.

Property In SE Roanoke Torn Down Just A Couple Days Before The Sale And City Attorney Contemplated Not Telling Buyers:
Roughly 5 to 7 years ago I was driving around last minute, a couple days before the sale, and saw one of the houses that was advertised for sale being demolished. When I got to the sale there was a photo of the house not demolished. I overheard the same attorney as before with my title problem talking to the guy in front of me. He was telling him that it was demolished but they seriously considered not telling the buyers as they don’t legally have to do so. I was shocked. It’s Unbelievable that anyone would even think about doing that. I’m sure that most people already did their research by driving around and viewing the properties long before I did and when they were looking at it it was there.

City Rezones Property And Hides That The New Owner Will Have To Convert It To Another Use:
Every once and a while the city rezones properties across the city. I think the last time they did it was in 2006. The law is that if a residential property is vacant for at least 2 years than it loses it’s CO and has to revert to a single family house. Almost every house at every tax sale has been sitting vacant for at least 2 years. It takes 2 years of non payment of taxes in order to be able to sell the property to get their tax money.

When a multifamily house is sold at these tax sales and you look online on their GIS you will see that they will leave the property listed as a multifamily even if they are going to force the property to be reverted to a single family due to sitting vacant for too long. Most people do not know these laws. Fortunately I have been doing this stuff for long enough to know what the city will pull on people as they have attempted to do the same thing to me or fellow investors I know.

If the property was rezoned as single family and sat there for 2 years the city will not let you keep it a single family. They will force you to get a permit and revert it to a single family house which could bankrupt someone who was not expecting those additional costs and just getting started out in investing. I have seen it time and time again.

There are MANY examples of the city hiding this information at the sale. As a matter of fact, Not a single time have I ever heard the city disclosing this information. Unsuspecting buyers pay big bucks for these properties thinking that they are able to continue operating it as a quad or triplex or duplex and then later find out that they have to dump many more piles of cash into it to bring it to the cities new requirements. Often they don’t have the money to do so and the deceptive practices that the city takes part in end up ruining the rest of their life due to that bad investment.

Take the property at 608 8th St SE that was sold at a tax sale many years ago. And the house is still sitting just as it was. The only difference is now the neighborhood gets to continue to look at that eyesore because the government hoodwinked the buyer who significantly overpaid for the house because he thought he was buying a Quadraplex. I bid on that house but couldn’t justify more than 5K due to the knowledge of the games that the city plays with peoples lives. This poor guy got in a bidding war with other novice investors and ended up sinking 20K into the property before any work was done.

Or look at the last tax sale and the property at 1509 Chapman Avenue. Which appears to be a duplex to the novice however it was rezoned a single family house and will be required to be converted by the novice investor. Wow, wait until they find that out.

I’m willing to bet that I would hear some city employees defending their non disclosure of this information while stating that they legally don’t have to. I would find it hard to believe that they legally would not be required to disclose something of such significance. However if they aren’t required to do so they still have moral and ethical behavior that we should be able to count on.

If you are reading this and you agree with what they are doing and are saying in your mind that an inexperienced investor should not be warned about this as they should have done their due diligence, than you have something very seriously wrong with you. Yes, I am calling you out specifically. You need to get help. You are an evil heartless person and need to go back in your hole. That’s right… I said it!!! The world would be better without people like you.

Now don’t get the impression that there was some big slip-up and the city “forgot” to tell the auctioneer. This happens at EVERY tax sale. And at EVERY tax sale the city pays it’s code enforcement department to be at the sale over in the corner taking notes on who the next owner will be as their attack will follow the new unsuspecting owners purchase. 

City Has Detailed Knowledge Of Serious Problems With A Property And Hide This Knowledge From Buyers:
Another property went up for sale at the past tax sale that had a huge fire in it a few years back. The city condemned the property after the fire and boarded it up. This property was 819 Campbell. The only reason I know that it burned is I own a property behind it. You can’t easily tell from the outside that this property was destroyed.

I bid on this property because I specialize in extensive rehabs. However I was only willing to bid at most $3,000 as it would take a substantial amount of money to rehabilitate it. Most people couldn’t do it.

Even though there were a number of the code enforcement staff and management in the building, they all decided to deceptively hide the fact that they condemned this building due to a bad electrical fire in the basement. I have been told by an unnamed city employee that they have, in their possession, a file on this property that includes all of the pictures of the damage etc but were unwilling to disclose it. It’s the law that things like this are disclosed by Realtors and knowledge of something like this and not disclosing it is FRAUD.

I have been told through the grapevine that in most cases they will not allow someone to back out of money owed to the treasury department but will make exceptions when friends of the city are involved. In this case the unsuspecting bidder of this property backed out which leaves the city offering the property to the backup bidder which was me.

So I contacted the auctioneer to purchase the property. But in doing so found that the new attorney outsourced by the city who is responsible for the tax sales has a “friend" that he is trying to give the property to and they are not interested anymore in selling it to the backup bidder which is standard procedure. NICE, again this kind of corruption these days should be expected from our local government. There was a day and time where you could count on and trust in what government does but I’m very sorry to say that that is a time that has come and gone…

You may be saying… Dallas, if you have the knowledge of this, why don’t you stand up at the tax sale and warn people. Well, my answer is that I did. Both me and Dan tried to tell the auctioneer, city employees and other buyers at the sale that the city was advertising an incorrect higher Tax Assessed value of every property but we were quickly shut down as the auctioneer referenced his communication with the city attorney regarding people speaking up at the sale. He then restated that they are correct tax assessed values. The reality is that they were last years higher tax assessed values and no representation of todays assessed value.

So what do we do about it? Actually I don’t know the answer to that. That’s why I’m writing about it. It can serve as education to novice and moderate investors. I will be sending it to the management of the city as well but they have shown me in the past that they are unconcerned about important matters such as this.

You Have To Have Thick Skin And Be Prepared For Traps To Work With Roanoke City

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See the letter below sent to me. It’s an example of what I continually hear from real estate investors in Roanoke City. Rather than helping guide the guy through the state process of rehabilitating a building they use the Virginia Statewide Uniform Building Code against him to make him feel helpless. It also appears that they are misinforming him of his rights.

This is the way Roanoke City currently operates and those who are in power should immediately put an end to it. People should not be treated in this manor. The city should roll the red carpet out for investment money and make the process easy to deal with. And inspectors should be required to take customer service education classes that teach them how to treat people with respect to make it a positive experience when working with the city rather than a nightmare.

This gentleman DOES NOT need an architectural engineer as they suggested to rehab the building himself. He is not making any major structural changes that would require that. He has NOT moved around any walls or done any major structural work other than ADDING one little wall. He is also NOT required to be held to 2014 code but rather the code of the date it was originally built.

Verification of that here:
http://www.reiofvirginia.com/2014/03/guide-to-virginia-maintenance-code-is.html

I have read the Virginia Uniform Statewide Building Code and it’s references to a Certificate of Occupancy. And It appears that you do not need a new CO if the property is being used for the same purpose as it always has been. If the prior CO has been revoked than they shall issue you another CO once the property has been brought back to code of the date it was originally built. This unnecessary harassment should stop. Driving investors out of the city to invest in the surrounding areas is not advisable and does nothing more than hurt and further depress our blighted neighborhoods. 

Roanoke Cities new policy should read, “If You Have A Hammer And Are Swinging It We’ll Do Everything We Can To Help You.”

Hi Mr. Powell,

My name is NAME REMOVED;  I recently found REI of VA online, which is where I found your e-mail address.  I hope my writing you isn't too inappropriate or bothersome. I need help, perhaps an attorney with an understanding of building codes as they apply to me, and I am hoping you can point me in the right direction.  I purchased my first would be income property 5 years ago in Roanoke City and have been renovating it in hopes of renting four apartments and two retail spaces in the building.  I am admittedly a complete novice at all of this, but I was trying to take a building that was empty, and an eyesore, and make it a decent, functional, and more appealing addition to it's surroundings.  It is a slow process for me because I am just an average individual, funding it out of my pocket a little at a time. The apartments and retail spaces had been rented in the past, before I came along, and the building was built in 1935.  I truly thought that "the powers that be" in the city would be happy with my efforts.  I have had a bit of an awakening since then.  I am having a problem getting a C.O., which they tell me I need, and they are telling me that they will not even talk to me about signing off on electrical work that I have had done, or anything else until I hire an architectural engineer to go top to bottom - front to back and give them among other things fire ratings for every floor, ceiling, wall, and stair.  Even if I can scrape together the funds to hire the engineer,  I am extremely concerned that they are holding this building to 2014 new construction codes.  I of course want it to be safe, but with things like the difference in thickness of drywall boards thru the years, I feel like I will be chasing my tail into bankruptcy. I have read several things on REI that seem to suggest I'm not alone in this. I really didn't think the City would be out to get me but that sure is the way it feels at the moment. Perhaps I can make it to Shaker's at some point, the group of people sounds amazing.

Thank you,
NAME REMOVED
PHONE NUMBER REMOVED

Monday, May 5, 2014

Estate Planning & Real Estate Exit Strategies This Week At REI!!!

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We have a very interesting meeting lined up for this week at REI of Virginia. The guest speaker will be attorney Joel Miller. He is a specialist in IRS Tax Matters and Estate Planning.

It seems that every single attorney I talk to has a different answer on what to do regarding estate planning. We now have an attorney with the right specialties to make a qualified decision. It’s very important for an attorney to not only have the knowledge of what can be done regarding Estate Planning but what the Tax Ramifications are as a result of doing so.

And in all good Estate Planning you should consider a good exit strategy. What do you do when it’s time to cash out? What’s the best way to pass property over to your children? What’s the best way to convert property to use to cover the expenses of potential care you need in the future? Is it wise to “spend down” all of your money so you are eligible for government care? What do you do if you own a few million dollars of property? There are many questions to ask and Joel will be there to cover the bases.

So come on down to the REI of Virginia meeting this week and spend some educational time with some good, like minded people.

See you there!

Friday, May 2, 2014

2014 Virginia Passed Laws That Affect Landlords.

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I did many hours of research to see what passed this year that people aren’t talking about in our industry. So, since no one seems to be watching, I’ll do it.

A: Small landlords now with 3 to 10 properties are subject to the Landlord Tenant Act look up HB 273  http://leg1.state.va.us/cgi-bin/legp504.exe?141+sum+HB273  Click on the Governors Acts of Assembly Chapter Text for the FINAL bill on all of these.

B: If a tenant pays a judgement that you have against them, you have 90 days to notify the court so it can be entered on the judgement docket. If you don’t you are liable for a fine of $100 as well as the cost of releasing the judgement. HB 393 http://leg1.state.va.us/cgi-bin/legp504.exe?141+sum+HB393

C: If a city councilman or other part time officer agent or employee of a city misuses public assets in the amount over $1,000 in a year period they will be slapped on the hand with a Class 1 misdemeanor which would be equivalent to a minor traffic ticket. That is IF the police department wants to charge them. HB 420 http://leg1.state.va.us/cgi-bin/legp504.exe?141+sum+HB420

D: Cities, counties and towns now have to give you the last 2 years of appraised values. They used to only have to give the last year. HB 525 http://leg1.state.va.us/cgi-bin/legp504.exe?141+sum+HB525

E: Group homes / boarding houses: Roanoke city currently says you can have no more than 4 unrelated adults OR a family and 2 unrelated adults in a house to be considered a single family house. This bill says that if you are renting to no more than 8 people with mental illnesses, intellectual disabilities or developmental disabilities and you have one resident or NON resident staff person which could be you, the house shall be considered residential occupancy by a SINGLE family. HB 527 Group Homes and Zoning http://leg1.state.va.us/cgi-bin/legp504.exe?141+sum+HB527

F: This one is great! If a tenant doesn’t show up to court, and you demonstrate to the judge that they owe more money, the court now is required to allow an amendment of the amount you are requesting on the unlawful detainer and enter a judgement for the new amount. HB 596 http://leg1.state.va.us/cgi-bin/legp504.exe?141+sum+HB596

G: Looks like now if you have it in your lease, you can bill a tenant for any local government fees that you get which include things such as storm water (rain tax), recycling, trash collection, rental inspection programs, power, etc. If landlords jump on board with this one the city will have repercussions when they go after the landlord. The fees that you charge them will be legally deemed to be rent. We will need to talk about this one in more detail. Maybe Ross will come in and talk about it. HB 614  http://leg1.state.va.us/cgi-bin/legp504.exe?141+sum+HB614

H: Adding an alternate name: Virginia Residential Landlord Tenant Act to The Virginia Rental Housing Act. Also now if you have terminated the rental agreement, and didn’t take the tenant to court, you are still legally owed unpaid rent, late fees, damages, etc. You no longer need a judgement for the money to be owed. Which would lead me to believe that you can now send a collection agency after them without a judgement.

Also in this bill if a tenant dies the rental agreement is immediately terminated on the date of the death and the estate of the person who died is liable for actual damages to the property. This bill is HB 638 http://leg1.state.va.us/cgi-bin/legp504.exe?141+sum+HB638
 

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