Tuesday, February 9, 2016

Property Management Skills That Make Life Easy

0 comments
Hi Everyone,

At this weeks meeting we will be having a round table discussion on rental qualifications facilitated by Amanda Miller. We will be discussing some of the most frequently asked questions of landlords such as…

* What does household income look like for an $800 rental?
* What if a prospective tenant has only been in their job for a month?
* What if they have bad credit?
* What if they have an unlawful detainer but it was 10 years ago?

This discussion will help you get different perspectives from other landlords by learning what criteria they consider important and why it works for them.

Good stuff people. There is no better way to make your life easier than picking the right tenants. It’s an extremely valuable tool. When done incorrectly, a bad tenant can make your life absolutely miserable. I have had my fair share of bad tenants and have learned from the school of hard knocks on this one. I am all ears when this topic is at hand. Just one little tip that works can mean the difference between this business being a pleasure or hell.

Come on out it’s going to be an information packed meeting.

See you there!

Tenant Tax Checks On The Way!

0 comments
Tenant Tax Checks are coming guys. And no, that doesn’t mean it’s a second Christmas for you. Smart landlords don’t wait for tenant tax checks to come. A great deal of tenants use that check to lure you to letting them stay longer for free. There are more that will get one over on you than will make right on their word.

They first will give you all kinds of excuses on why they aren’t getting it on time. Then finally why they didn’t get what they thought they would get. That is if you get that far. You will be lucky if they don’t just move out and completely hoodwink you.

It’s such a common scam. To use that tax return as first months rent and deposit on the next place while the rest of it buys toys for them. That’s a lot more fun than paying thousands off to their old tired landlord. 

So don’t be a fool. File your UD’s. Judges like you to work with your tenants. If you want to be lead along you can still do that. You can send a fax to the judge the night before court requesting a continuance. Make sure you have all of the case details so they know what you’re talking about and suggest the date you would like it continued to.

You can keep doing that until you dismiss it when they paid, or until you find out that they are lying and you then already will have the court date in place to put a quick end to it.

Yes, it is possible to put your tenant in court and still be nice. This is a business and people understand that. Your mortgage, insurance, taxes, etc aren’t going to pay themselves and you’re not one of those rich landlords that owns all of their property. The bank owns every single house you got. And you got to do what you got to do. However you would be more than willing to continue it as long as they show to you that they are serious about getting it repaid. And they are making honest efforts at doing so with substantial payments along the way. And I don’t want to hear any more of that garbage about you having to pay your light bill. I don’t care about your light bill. It’s crazy to me that you think that your light bill is more important than your shelter bill. LOL, sorry got off a tangent…. That’s all you have to tell them people. They will understand if you explain it right.

Some Bills You May Want To Watch

0 comments
So here are some bills that are out there that you may want to keep an eye on. There is a never ending attack against landlords in the Virginia General Assembly. Some laws get through while others get stopped. Don’t count on the bad ones getting stopped. You should contact your legislature to tell them which ones to vote for and which ones to vote against. Pretty easy to do. All it takes is a phone call and leave a voicemail or a message with their legislative aid on what you support and what you don’t want them to support. EASY. Pick up the phone!

When reading these bills, look at the italics. That is what they are trying to add. Any strike-throughs are what they are clearly trying to take out. These are bills that are in the process of trying to get passed right now this very minute.

1. This one is the first of several steps of attempting to make it so you will have to be licensed to be a landlord. Can you see why? Think about it.

http://leg1.state.va.us/cgi-bin/legp504.exe?161+ful+HB1011

2. This one allows Legal Aid and tenants to get you real good on Mold issues. Even if it didn’t exist when they moved in and they likely are the one that created the problem. You will pay dearly on this bill if it passes. Don’t be fooled by the good things they list with the bad. Things that you ALREADY have the right to do. That is nothing more than a diversionary tactic to try to get idiots to agree with the bill. You’re not an idiot. Click the full text to read it all if you wish.
http://leg1.state.va.us/cgi-bin/legp504.exe?161+sum+HB735

3. Authorizes the judge to terminate your rental agreement if the tenant files a tenants assertion. We have no need for additional laws against landlords. It’s already bad enough.

http://leg1.state.va.us/cgi-bin/legp504.exe?161+sum+HB1209

4. This one hammers the landlord even harder with higher damages the tenant can get from the landlord in legal aid battles. They already can get you for triple damages. Yes, you heard that right. 3 times the amount that they win. So if they win all of the rent that they ever paid you back, then triple damages is that times 3. That is the existing law. Do we need it higher than that? All they have to do is prove that you excluded them from the house as a result of an interruption of the utilities. Such as the water got cut off. Or you accidentally gave them the multifamily lease where you paid the water and this was a single family. But the lease said that you pay and you turned it off since it is a single family. There are all kinds of innocent reasons why there could be an interruption of service. Like you had a break in the yard you couldn’t find. Or you had to rewire your house for some reason or another. It could even be that they couldn’t live there because the mold was so bad or any reason including a reason that they caused. Thinking about making that call yet or are you still sitting on your hands?
http://leg1.state.va.us/cgi-bin/legp504.exe?161+sum+SB377

5. Ladies and gentlemen. Republican Mark Obenshain is trying to make it so you are responsible for an unlimited amount of months of tenant unpaid water bills. You are currently limited to paying up to 3 months of their bills. He is trying to make it with this bill so the Water Authority can turn on their water and never turn it back off for months to years and if they don’t pay you will personally be responsible for it all.

http://leg1.state.va.us/cgi-bin/legp504.exe?161+sum+SB542

How about now people? Are you still sitting on your butt or do you have your phone in your hand dialing your senator and delegate? Go to this website http://whosmy.virginiageneralassembly.gov/ to find out who your legislator is. Call your State Senator and your State Delegate and leave them a message. Please, do this for yourself and all other investors in town. I can guarantee you that most people who get this email will do nothing. Don’t be one of them. We need your help! You need your help!

So out of all of the bills, We have 1 good one. And that is from our friend, Senator Edwards. Please call him and leave a message of thanks. His number in the Capital is 804-698-7521 and here is 540-985-8690. This guy is really sticking his neck out for us. We owe him big time!

Here is Edwards bill. It requires the Water Authority to have a signed agreement with the landlord that we will pay the tenants delinquent bill. If they don’t, we don’t have to pay. And there is already a provision in the bill that says that the Water Authority can’t refuse to turn off the water that will work nicely with this added Edwards wording.

http://leg1.state.va.us/cgi-bin/legp504.exe?161+sum+SB547

Tuesday, February 2, 2016

Back To Basics This Week At REI

0 comments
This week we will have one of our favorite speakers, real estate expert, Ross Hart.

Ross will be at our meeting to talk about his 5 Day Pay or Quit, how to properly fill out an Unlawful Detainer and a fantastic letter he uses that is to be sent at the end of the lease to notify the resident of any damages, detailing what will be deducted from the security deposit.

Come on out. It will be a fun meeting. Ross, as always, is a highly entertaining speaker and has some great stories.

Tuesday, January 26, 2016

Tax Free Exchanges This Week At REI

0 comments
Most of us who have been involved with real estate for a while have heard of the 1031 Exchange. But most investors I know haven’t taken advantage of it. Effectively using this tax strategy allows you to exchange one regular or vacation rental property for another rental property without having to pay capital gains at the time of the exchange.

House for house, equipment for equipment, truck for truck…. There are several different types of Like Kind Tax Free Exchanges other than the 1031 Exchange.

This week we’re going to have our good friend Robert Young who has done MANY of these tax free exchanges. Robert knows the ins and outs of these exchanges better than anyone I know.

Come on out and learn about this tax strategy that can be used to make a lot of money over the years due to being able to kick the can down the road on the date you have to end up paying these taxes.

Monday, January 25, 2016

Who Shovels Snow? Tenant or Landlord

1 comments
In Roanoke City who is responsible for shoveling snow? The tenant or the landlord? It is the responsibility of the tenant. Sure you can do it if you want to. But by Roanoke City code it is the occupant of the properties responsibility to clear the sidewalks. If the house is vacant than it's the responsibility of the owner of the property.

Here is the specific code section.


Sec. 30-16. - Removal of snow, ice, sleet and mud from sidewalks.
(a)
It shall be the duty of the occupant of every building, house or lot which has a sidewalk or footway of brick, stone, wood, concrete or other permanent material adjoining or touching upon the same, either in the front, in the rear or on either side, to have all snow removed from such sidewalk or footway within three (3) hours after the same shall have ceased falling, unless such snow shall have fallen during the night, in which case it shall be removed by 9:00 the next morning. The same requirements shall exist with respect to ice, sleet or mud on the sidewalks or footways, except that the same, when it cannot be removed without injury to the sidewalk, shall be covered, within the same period of time, with sawdust, ashes or other material which will render it safe for travel. When there is no tenement on such lot or any occupant of any tenement thereon, it shall be the duty of the owner of the lot or tenement to have the snow removed, or the ice removed or covered, or the mud cleaned off from his sidewalk or footway, as above required of occupants of houses.
(b)
Each six (6) hours that snow, ice, sleet or mud is allowed to remain in violation of this section shall be considered as a separate offense.
(c)
In case there is no occupant of the premises, and the owner or agent cannot be found, the city manager may cause the sidewalk to be cleaned or covered, at the expense of the owner, with a penalty of twenty (20) percent added.
(Code 1956, Tit. XVII, Ch. 2, § 7)
State Law reference— Authority for above section, Code of Virginia, § 15.1-867.

Sunday, January 24, 2016

Interest Owed On Security Deposits

0 comments
Federal Reserve Board Discount Rate

Security Deposits gain interest if they are held by the landlord for 13 or more months. If a tenant is in your house for 12 months and you give their security deposit back before the 13th month you owe no interest. The law is that you give interest based on 1 Percentage Point Below the rate it was in January of that calendar year. The rate you go by is the Federal Reserve Board Discount Rate.

(January of the calendar year)

2003 - 2.25      Landlord owes 1.25%

2004 - 2.25      Landlord owes 1.25%

2005 - 2.25      Landlord owes 1.25%

2006 - 5.5        Landlord owes 4.5%

2007 - 6.25      Landlord owes 5.25%

2008 - 4.0        Landlord owes 3.0%

2009 - .5          Landlord owes 0%

2010 - .5          Landlord owes 0%

2011 - .75         Landlord owes 0%

2012 - .75         Landlord owes 0%

2013 - .75         Landlord owes 0%

2014 - .75         Landlord owes 0%

2015 - .75         Landlord owes 0%

2016 - 1.0         Landlord owes 0%

Sunday, January 17, 2016

Renting To Ex-Offenders Recently Released From Prison At REI This Week

0 comments
Ladies and Gentlemen,

This week we have an interesting topic for consideration. Our guest speaker will be Katherine King of TAP. TAP has a program where they help ex-offenders get permanent housing. When they get out of prison they go to a halfway house called the Dorcus Home. During that time, in order to be released from the halfway house they are required to obtain full-time employment and secure a lease on a house or apartment.

If they do not complete those tasks they are sent back to wherever they obtained their charges and run the risk of homelessness, unemployment and falling back into their criminal patterns.

TAP’s program, Training to Work, assists ex-offenders in their reentry back into society as productive citizens through the use of job skills training, education, employment, life skills training and more.

TAP will be coming to our meeting to teach us about what they do for these ex-offenders, show us the benefits to renting to them, and to determine what our individual criteria are for a tenants criminal history.

There are no sex offenders in their program.

So for this meeting there are some questions you should challenge yourself with.

*  If a person committed a crime 10 years ago and has spent the last 9 years paying for that crime they committed, should they be able to get another chance at becoming a productive citizen?

*  Are people capable of changing when given the opportunity to do so?

*  If you are considering a multifamily house to try out with this program, should the house be all ex-offenders? Are you putting your other tenants at risk by renting to ex-offenders?

*  If you have a policy against renting to those who have criminal charges, are there certain charges such as marijuana or white collar crimes that you aren’t as concerned with and would consider as a resident?

My personal policy for my low income properties falls along the lines if they have had an eviction before or not. I have found if someone has had an eviction than the chances are significantly higher that I will be evicting them within a few months. 

I also personally don’t like renting to people that have violent crimes. I don’t like the idea of having to fight and hurt someone in order to defend myself if I have to put them out due to non payment of rent. I have had a few over the years who have thrown their shirt off and wanted to fight when I had to file an unlawful detainer.

I also don’t like crimes with the word “public” in it as they seem to cause lots of drama on the way out. These are crimes with names like “using profanity over the public airwaves” whatever that is, “public drunkenness”, disorderly conduct, etc.

One question I would have for TAP is if they have some sort of program that would make us feel secure about renting to these ex-convicts. A program that would pay their rent if they lose their very new job. Something where there would be some benefits that could outweigh the potential downfalls.

Come on out to our weekly show. This will be an entertaining meeting on an interesting subject. Should people have another chance? Should they be allowed to get past their crime they already paid for? I think they should but I can also understand why someone would not want to do business with them.

See you there!

P.S. - Again I have to remind everyone about dues. It’s real easy to click the link at the top right of this page now and get it paid for this year. This isn’t money going into anyone's pocket. We are all volunteers. If you don’t have it right now you can still come though. We’re not going to put you out. We just want everyone to know it’s that time of year. And we need to work towards getting that squared away for this year. It’s pretty darn cheap. $100. We are lower than most of the REI groups in the country. Mainly because we aren’t paying anyone to operate the group. So, please… go ahead and click the link below and get this years dues paid.

BTW, those of you who haven’t signed up yet, I just put out a great deal. 7 wholesale units in one deal. All 7 units for $150K. That little business brings in $46,000 per year. If the rents were where they should be it would bring in 50K a year. Nice little income.

That deal won’t go out to everyone else until the premium members have had a chance to look it over. And it only will if the premium members don’t take it. There are some nice benefits of being a premium member. And we’re working on several others. Please… sign up in the top right corner of this website now!

Tuesday, January 12, 2016

REI Dues

0 comments
Click this text link to pay REI dues via PayPal.

This week at REI we have no guest speaker. This will be a moderated group discussion. These are often some of the best meetings. We will talk about various subjects.

I’m not going to get into thinking about various topics at this time because I just spent about 2 hours figuring out how to put a Paypal link on our website and in this email for annual dues.

I figure I’ll just let Andy wing it. LOL just kidding. I will help him wing it.

One of the pieces to the puzzle that keeps our organization running is our dues. Which still isn’t enough to pay anyone anything to run our organization. As I have said before, we are all volunteers. No one gets paid anything as of now. We have been trying to save up some money for a legal fund for our members in case we have any big cases we need to use it on.

We also are saving up to invest in some form of real estate. If we can get enough money together to do flips with it then we can create a machine that will continue, no matter who on the board continues with it. We will also create a machine where people within our group can get paid to physically do the flips. And newbies can learn from watching. A good win win for everyone.

My personal primary objective for REI would be that I would like to see REI get to a point where it can go on without me or any of us volunteers.

I would like to see REI at one point in time hopefully not in the too far future to be able to be self sustaining. To make enough money were I am replaceable. Where any of us are replaceable. And in order to be replaceable it has to be a paid position. There aren’t many people who want to invest the significant amount of time that it takes to put on this show we give to you every week without getting paid to do it. And it would take 1 full time paid person to completely run it effectively.

It would be nice to develop something that one day those of us who are volunteers can walk away from. Something that will keep on going and will continue educating and protecting investors in our area.

So to keep this short and sweet, as I have to get to some paid work, please click the link below if you haven’t paid this years dues yet. We lose about 3% to Paypal with this but we’re thinking making it easier will end up in getting more people to sign up this year. Our bet of reducing our dues last year to $100 worked out fine. We had a few more people sign up.

So we’re rolling the dice again on this Paypal link hoping it will work. Just like in Vegas. Only no free liquor.

Very soon we will be tightening down a little trying to get everyone to pay the yearly dues. You may get asked at the door if you aren’t on our list of who has paid. We have several people who come to the meetings who don’t. And that’s not fair to those who do. The only people we have set up to get in for free are new potential members. They get a month to see if they like it. No one else.

It’s $10 at the door if you aren’t going to sign up for premium membership. That’s our policy for those who just want to go to a meeting once in a great while. However we would prefer that you sign up as a premium member so you can help support the cause.

Please see the link below…

*** If you are paying with a business card or someone else's card that I don’t know, please be sure to leave your name and email address in the note to the seller box when purchasing. I need to know who paid so I can move you over to the 2016 Member list. Also if you are paying for 2 or more people please let me know the 2 or more you paid for.

Click this text link to pay REI dues via PayPal.

Monday, January 4, 2016

Predictions for 2016

0 comments
This article is long and will require you to put your thinking cap on. It’s real important information though. Especially if you’re using economics to make yourself rich. Or using it to prevent your future demise. Read it when you have a few minutes for some pretty intense mind twisting data that I’m going to lay out for you in the most simple way I can. 

We’re finally here. This is the year I have been waiting for. Or very close to it. It’s time to start making some good money again. Those who prepare themselves for big economic events walk away wealthy. Those who get surprised by them will walk away broke.

The perfect storm is brewing guys and gals and I’m ready for it. I’ve paid for several forecasts over the last couple of years from various economists that all claim to be the best. The one consistent thing that they say is we are on our way to a complete meltdown. Wether it happens at this upcoming recession or the next I’m not sure. Many of them believe it’s right around the corner.

So lets say that it holds of until the next recession. This one or the next one, there are several things that will likely happen during this recession that you can make a lot of money from. Which include another likely housing crisis. I made my first million as a result of our last 2008 housing crisis. And I plan to make several more on the next one. I was just dipping my toes in the water on the last go around. I now know exactly what to do during a housing crisis and I plan to repeat it to a much larger scale.

You may ask why do I say that the perfect storm is coming. Well, let me tell you what I’ve learned from the experts. We are currently converging on several different economic issues that are going to have a dramatic impact on the stock market. The upcoming stock market crash will in turn have an impact on the housing market as there will be many people who will lose all of their wealth in this next crash.

Cyclical patterns happen historically that can be used to predict the future. Roughly every 7 years a recession happens. In 2016 we will be in year 8 since our last recession so we are due for another any time now. An additional factor is 2016 will be a presidential election year. Presidential election years are always hard on the stock market.

To make matters worse, the year 2016 is the year where the first of the baby boomers turn 70. There will be 700,000 baby boomers turning 70 in 2016 and they will be required by law to start spending down their retirement and sell off a portion of their stock. This will continue to compound every year where an additional 700,000 baby boomers turn 70 and have to start selling some of their stock every year. This is expected to have a dramatic negative impact on the stock market.

The millennials were previously expected to hold up the housing market but as it turns out they aren’t buying houses like previous generations. As of now they prefer to rent. Millennials grew up during our housing crisis. Previous generations felt like owning your own house was one of the largest and best investments you would typically make in your lifetime. Millennials don’t think of owning your own house as being such a great investment since they saw their family or friends families lose property from the 2008 crash. It is expected that they will begin purchasing property about 10 years behind the norm.

This very minute you can see signs of a crisis coming. The stock market is having regular massive fluctuations up and down. 

The United States National Debt is now at almost 19 Trillion dollars. That equals over 157,000 worth of debt per taxpayer. It has very quickly reached a point where it is impossible to pay back. The rest of the world still has confidence in the United States. Once they lose confidence in our ability to repay our debt, the dollar will crash. And it will happen very quickly. 

Or currant president has created more debt than all of the previous presidents combined. Mark my words the United States will never pay back the National Debt. We are quickly coming to a point where we won’t even be able to pay the interest on the debt. We will start WWIII the day we tell China that they have been artificially propping up their currency and we don’t owe them that money. We will tell them that we wouldn’t even have that debt if it wasn’t for their currency manipulation. Which technically is true considering the fact that their currency manipulation helped strip the manufacturing jobs out of this country. And it has helped the remaining manufacturing companies who managed to hang on have extreme difficulties worldwide competing with China in the export of their products. Their social tariffs which put fees on our exports entering their country also made it difficult for us to compete since we weren’t playing on a level playing field.

The largest budget items that the US has are Medicare/Medicaid, Social Security, Income Security, Federal Pensions, Defense, and Net Interest on Debt. Expect to see major cuts in these areas at the first attempts of balancing the budget. These cuts are going to have to come from everywhere if they make an honest attempt to eliminate the national “debt". Just balancing the budget (balancing the “deficit”) will take some very serious cuts. These cuts if done correctly will lead to rioting in the streets as what happened in Greece when people got their entitlements taken away. We’re going to need cuts to that degree if we seriously are going to pull out of this mess that the politicians created.

Out of those major budget items, one of the first to be whittled away will be Medicare / Medicaid and Social Security. This Obamacare stuff ended up doing the exact opposite as to what was needed when it adds trillions to the national debt in this area. The government is expected to continue to grow the massive federal pension plans. They won’t personally want to get off the gravy train. If anyone is going to be hurt it’s not going to be them. Pension plans that’s crazy anyway. They need to be stopped. And switch to a 401K or something. What business in the country still has pension plans? Not many.

The government is also not expected to do much with national defense as far as more cuts go.  Defense represents roughly 6% of our national debt. Back in the days of Abe Lincoln it represented roughly 5%. And as you know, there really isn’t anything that they can do about the interest on the debt.

So when they start tinkering around with Medicare and Medicaid, do you think they are going to take away elderly health care or will they take it away from the handicapped? Hard choice? They could make one big very well needed cut in this area by simply making every person on disability, reprove their disability every year or two. It is possible for a person to get better. All landlords know the massive scale of disability fraud out there. Reproving disabilities would weed out many of the scammers while those who really need it will be able to keep it.

Social security is a real tough one to take away. Especially since that is your money that you invested. In doing so they will have to admit that the United States government ran the biggest Ponzi scheme in World history. They will have to admit that they spent all of the money and the elderly now will have to stick it out on the street because they won’t be sending their money they use for rent anymore. I don’t see that happening. But it is very possible that they admit what they did and give a cutoff point where they tell everyone if you are under this or that age you will get nothing. They will also develop another plan for those who got robbed from the government and they will make it seem to them that they have some great opportunities to get every penny back with this new method. Do you think any of the congressmen will go to prison for their Ponzi Scheme which essentially robbed every working man and woman in this country? Will any of them get prosecuted for the crime of Treason they committed which is punishable by death?

We are in a Government Bubble right now. A government bubble AND a Credit Bubble. All bubbles eventually pop. The question is NOT “will it happen” but rather, “when will it happen”.  And when it does happen will you need to be able to protect yourself with weapons and ammunition? Will you need to feed yourself with food you stored to get through a bad time and a run on the grocery store shelves? Will you need to power your house with a generator because the electrical grid gets shut down or no one can afford to pay for it due to a limited supply of cash? Does that generator need to be a solar generator due to a run on oil and or gasoline? Do you actually think that that can’t happen in the United States even though it happens all over the World? Did you know there is almost always several countries at any given point in time that are in a major crisis such as this?

Have a look at this link to visually comprehend the magnitude of this issue.

http://www.usdebtclock.org/

Currently the dollar is doing very well against other currencies. It is being propped up since it’s the worlds reserve currency. For those of you who don’t know what that means, let me give you an example. If Poland was going to do business with Australia they would exchange US Dollars, not their own currencies. There have been major efforts at ending it’s world reserve currency status by both China and Russia. They have made deals with each other and other countries that they will trade in a note currency. Not ours.

The rest of the world is in a recession right now. China and Russia are having financial issues as well as Europe. As other countries currency loses value, the US remains the one 1st world safe haven for the wealthy in those countries to put their money and hedge it against the losses that are happening where they live.

The next country predicted to fall after Europe will be Japan. It’s ratio of gross government debt to their entire Gross Domestic Product (GDP) is 240%. After Japan it will be our turn in the United States. When we crash we will cause a global depression.  Our ratio of government debt to GDP is roughly 104%.

This isn’t just an issue of government debt. Our entire economy revolves around people using credit to purchase products both for their personal lives and business lives. As I said before, the things that are propping up the United States are the dollar being the worlds reserve currency and the fact that other countries are currently doing much worse than we are that have to have somewhere safe to shelter their money.

Lets go over some of the projections from the leading cyclical economists.

The Kondratieff Wave is one of the most prominent of all economic theories. So much so that the Russian economist, Nikolai Kondratiev who saw this pattern was eventually executed because of it. Those Russians don’t like someone accurately predicting the future I guess. Especially when it’s bad.

The Kondratieff Wave essentially says that there is roughly a 60 year cycle of economics that happens over and over with ALL countries. It is thought of as having 4 distinct “seasons". Each season lasts several years. The United States is right now in the start of the “winter season” which lasts 20 years. Here is what happens with a countries economy during these seasons.

Winter: excess capacity worked off by massive debt repudiation, commodity deflation & economic depression. A “trough” war breaks psychology of doom. (we’re here right now. And will likely be moving into a depression phase at our next crash. We have been experiencing deflation recently. And our trough war I suspect will be WWIII or a major event with the global terrorists. The last time we were here was the 10 or so year phase of the Great Depression which ended in 1939 and the 10 years following it through WWII the trough war of those days.)
Spring phase: a new factor of production, good economic times after getting through the hard winter phase, rising inflation. (this is what we get to look forward to they suspect after 2020. We were here last in the booming economy of the 1950’s. The US was just officially becoming the Worlds strongest military power. A magnificent post war economy and the beginning of the Baby Boom. The GDP more than DOUBLED in the 50’s.)
Summer: hubristic “peak” war followed by societal doubts and double digit inflation. (Remember the Jimmy Carter days? And Vietnam in the 1970’s)
Autumn: the financial fix of (Carter) inflation leads to a credit boom which crates a false plateau of prosperity (Regan - Clinton) that ends in a speculative bubble (Bush & Obama) (we just got out of the Autumn phase a couple years ago and into the Winter phase. They say roughly 2013 was the end of Autumn.)

This is not the only economic cycle that suggests that we are headed towards an “economic depression".

Cyclical economist Harry Dent primarily focuses his theories on demographics. The fact that our population is aging rapidly. He expects the worst economic trends due to demographics to initially hit between 2014 and 2019.  And it will last until the year 2023. He feels it will be exceptionally hard because “the every day consumer never came out of the last recession”. Dent says that Japan is still in their “coma” from their recession 20 years ago because they never let their debt bubble deleverage (Pop). And the only way we will not follow in Japan’s footsteps is if we stop printing money. The Federal Reserve is artificially propping up our economy and creating the same issue with the 4.5 trillion dollars they have printed to add to the system. If they keep printing money we will go into a stagflation type scenario where the economy will stay extremely lackluster for many years to come. The only way to really fix the problem is for us to bottom out hard and heavy by deleveraging. We then will pick back up relatively quickly and get back into a good growth economy.

Regarding Dent’s theory pertaining to economic issues surrounding an aging population, how does that make you feel about the whole amnesty issue now? These are mostly young illegals coming into our country.

These cycles have been studied for years. There is even an English economist named William Stanley Jevons who found that the sunspots are on the same cycle as the Words economic cycles. Yes, that’s right. When the sun’s spots die down the World’s economy dies down. When they ramp up the economy ramps up. I’m sure this is coincidence and they are simply on the same cyclical pattern but who knows; a full moon is known to effect peoples personalities. And female friends or co workers menstrual cycles often end up coinciding with each other in roughly the same dates each month. Strange things happen that we can’t explain.

Here are several other leading cyclical economists and their predictions. Some of which we are already a little past due.

Charles Nenner Research (source)
Stocks should peak in mid-2013 and fall until about 2020. Similarly, bonds should peak in the summer of 2013 and fall thereafter for 20 years. He bases his conclusions entirely on cycle research. He expects the Dow to fall to around 5,000 by 2018 – 2020.



Kress Cycles (Clif Droke) (source)
The major 120 year cycle plus all minor cycles trend down into late 2014. The stock market should decline hard into late 2014.



Elliott Wave (Robert Prechter) (source)
He believes that the stock market has peaked and has entered a generational bear-market. He anticipates a crash low in the market around 2016 – 2017.



Market Energy Waves (source)
He sees a 36 year cycle in stock markets that is peaking in mid-2013 and will cycle down for 2013 – 2016. “… the controlling energy wave is scheduled to flip back to negative on July 19 of this year.” Equity markets should drop 25 – 50%.



Armstrong Economics (source)
His economic confidence model projects a peak in confidence in August 2013, a bottom in September 2014, and another peak in October 2015. The decline into January 2020 should be severe. He expects a world-wide crash and contraction in economies from 2015 – 2020. Watch the movie The Forecaster. Amazing guy this Martin Armstrong is. He got locked up by Goldman Sachs for many years for refusing to give a judge his economic forecast which they found to be unbelievably accurate.



Cycles per Charles Hugh Smith (source)
He discusses four long-term cycles that bottom in the 2010 – 2020 period. They are: Credit expansion/contraction cycle, Price inflation/wage cycle, Generational cycle, and Peak oil extraction cycle.


So my question to you is. Does history repeat itself? After reading this information, do you feel like we very well could be close to the perfect storm? Are we in a situation where we could have a potential major crisis? A crisis that is of the magnitude of a complete government and credit bubble meltdown? And what are you going to do about it? Are you prepared for what will happen? Do you even know what will happen? It is expected to be at minimum as worse as if not much worse than The Great Depression.

In future emails I will write a little bit about how things could look. What types of things are expected to happen. In my research I’m trying to determine what exactly will happen specifically to landlords and with tenants. Based on what happened in other countries who have crashed as a result of debt related issues.

REI Self Defense For Sissy’s, I Think Not!

1 comments
Across the country landlords get attacked and killed on a regular basis. Many of these landlords are killed when their tenant gets angry at them. This is not something that you just have to be wary of in a big city. Several landlords have been killed while on the job in Roanoke. Some of which were killed by their tenants.

One of a few examples of this was the murder of landlord Harold Markum who was beat to death by his tenants Meghan and Justin Musser. He was found dead with a tear streaming out of his eye.

http://www.roanoke.com/webmin/news/man-to-serve-years-in-killing-of-landlord/article_f53e7dab-8190-5d6d-a749-c052dd3bd949.html

The first step in protecting yourself from getting attacked or killed is avoiding situations where you have a higher likelihood of something happening to you in the first place.

Some tips that I have learned over the years that keep me from having to hurt someone while protecting myself include:

* Never physically pick up rent. Have a drop off location such as a UPS Store that will collect your rent for you. Have a mailing address that is not your home where tenants can mail their rent. Everywhere you write your address, including court documents, should list the P.O. Box or UPS Box address, never your home address. Including but not limited to the address you have your tax bills sent to that shows up on the GIS. Look at your home as your bunker. The only people know where it is, is your friends.

* Be nice to your tenants at all points in time. Yes I realize that there are PITA tenants that can really get under your skin. Keep your cool and keep it professional always. If they cuss you out on the phone simply tell them you aren’t in business to listen to this garbage, good bye, and hang up on them. They will likely blow your phone up for a while with continuous calls. Don’t answer them. Give them a cooling off period before talking to them again. That is if you decide that you are going to talk to them again. The next time you see them may be in court.

* Have a contractor do all repairs / maintenance when there are tenants living in the house. Also have your contractor meet the deputy for your evictions / set-outs. Your tenants aren’t mad at your contractor. They are mad at you for putting them out. Avoid confrontations by avoiding the drama.

There are times where you have done all of the right things and you still are in a situation are in danger. That’s where our guest speakers come into play.

There are a couple schools of thought regarding how you protect yourself when your life is in danger. The Roanoke City Police department suggests that you run away. However in many cases running away isn’t going to help you. Such as the case with the elderly landlord, Mr. Markum. Sure you can try to run but who’s to say that you are faster than your attacker. And do you really want to die without at least trying to give up a fight. Die while on the run? Not me!

Our special guest speaker will be Tim Habla of Counter Response Tactical. Tim is an expert at standing and fighting. And Tim is coming to our group to give us some tips that don’t include sticking your tail between your legs and running away.

I tried to find an embed code to embed this video but it doesn’t appear that they have one. Have a look at the link below. Our guest speaker is around 2:35 of the clip.

http://www.virginiafirst.com/news/how-to-protect-yourself-in-a-worst-case-scenario

By The Way, if I was an attacker and the person I was attacking was using the push away “Get Back” tactic that the Roanoke Police were teaching in the video, I’m going to hurt them…bad. You could not stop or even slow me down doing that. That will only make me mad.

And if you’re going to wait it out for the police to show up, they will be there after you have already been assaulted or killed. Not during or before the attack. Police get there AFTER the crime has already happened. Only on a very rare occasion do they get there during the crime.

You NEED to be able to protect yourself with a weapon if necessary so you don’t have to worry about your safety. That is unless you are in an area where weapons are not allowed such as the Virginia Tech campus which is referred to in the video. I guess it’s different in areas like that where mass murders pick to do their killing since they know no weapons are allowed. The anti gunners logic though says you’re safe there since weapons are banned.

Come on out to the meeting this week. It’s going to be a fun one!

Monday, December 28, 2015

REI Guru This Week At REI

0 comments
Hi Everyone,

ATTENTION: This week we have the big room to the left in Jeresy Lilys. NOT the normal room to the right.

Our special guest speaker will be REI Guru Keith Boley of REI Wealth Academy

Keith comes and visits his Mom every Christmas and speaks with us while he is here. He’s from California and they have a different spin on this stuff than we do here in Virginia so it’s always fun to listen to him. He’s a great source of information.

This weeks topic will be about doing lease options AKA Rent to Own, Lease Purchase, etc, the Keith Boley way.

Come on out. It’s going to be a great meeting!

Monday, December 7, 2015

Rehabbing Houses From Beginning To End This Week At REI

0 comments
The next couple of weeks we’re going to spend some time focusing on turning ugly houses into pots of gold. It is true that you make your money when you buy a property. It’s not money that will fill your pockets if you’re buying and holding as a landlord does. It’s what they call unrealized income. It shows up on paper but it’s not anything you can spend until years down the road when you are ready to retire or start selling them off a few at a time.

The road to real wealth is by using a buy and hold strategy in real estate. Flippers and wholesalers end up working their tails off on each and every deal they get. They also pay the government very well with their short term capital gains. And when they stop hustling their income stops. This is why you don’t see many flippers and wholesalers that are extremely wealthy. There are a few here and there but there are WAY more landlords that have made it in the multimillion dollar range. And with much less effort.

Landlords get the benefits of buying property, keeping it and having their tenants pay off the mortgage, insurance, maintenance, taxes, etc. They also have the added benefit of depreciating the property over 27.5 years, mortgage interest deductions and many other benefits to buying and holding property. Such as extra pocket cash from each rental every month if done correctly. And unlike flippers and wholesalers, they can completely stop working for years but their income will keep rolling in. Landlording is the true definition of farming your mailbox. 

One very important step to successfully landlording property requires finding properties that need a substantial rehab.  Buying properties in rough shape and doing a major rehab is the secret to obtaining 100% financing. And it helps tremendously with the growth of your company if you can get all of your money back out and put it into a new investment. So you’ve got to get something that you can put some sweat equity into to dramatically increase it’s value. Done correctly you will easily be able to get all of your money back out and reinvested.

The next couple of weeks we are going to listen to some Guru CD’s about rehabbing houses. They aren’t very long so we will have plenty of time to have a group discussion about rehabbing for both flip and landlord purposes. We will discuss the full spectrum of how rehabs should be managed so you have a firm understanding of what you do and don’t do for a flip and rental.

Come on down to our weekly shindig and spend some time with some educated like minded people. Attending REI once a week will keep your eye on the prize at the end of the path. It’s easy to get off track and real important to maintain focus if you have plans on retiring with more money than you know what to do with.

We’ll see ya there!

Tuesday, December 1, 2015

What Do You Tell Your Tenants That Give You A Hard Luck Story?

0 comments
Tenants are constantly trying to slip out of paying rent right around Christmas. I get several every year. They blame it on all kinds of things. Some say their car broke down. Others say they got a massive utility bill. And then there are the ones that will blatantly tell you that they want to get Christmas presents instead of paying rent. And they want you to essentially finance their Christmas to them at 0 percent interest with payments of X dollars per month until they are caught back up. LOL

What’s going through my mind at that point? I have a Christmas present for you.… And I’ll even pay someone to serve it on your door. EVICTION COMING SOON!!!

Obviously you can’t tell them that. There will be no benefit to you for doing so. There unfortunately is a game that you have to play from time to time with your tenants. Even if you don’t feel like playing you have to always do what’s in your businesses best interest.

I’ve found something that works very well as a reply. It typically shuts them right up and makes them realize that they better consider another bill to blow off. The rent isn’t going to be the bill that they can do that with. And if they do, you will be forced to evict them.

So here’s a version of what I write to them throughout the year when tenants give me their hard luck story or blatantly tell me they don’t want to pay their rent right now and want to make up for it later. It’s nice and makes them understand that your bill is important.

When I tell the bank, insurance company and city that I won’t be sending their payments on time they don’t care. They give me a fine anyway. And the bank will foreclose anyway. That’s exactly what they will do to me. I don’t own a single house that I have. The banks own all of them. I haven’t been doing this for long enough to have a bunch of paid off mortgages. And I’m not rich so I don’t have the ability to make all of these payments I have to make without rent. And that’s the reason there are late fees with most landlords. Ones who have been doing it for a long time a late fee is extra pocket money. Ones like me that haven’t it ends up paying my late fees and city fines I got for not paying on time. The only reason I’m telling you my personal business is I think you need to to fully understand my situation so you will know that I have to do whatever I need to do to survive by keeping regular on time paying tenants.

Most often that one long text response ends it right away. They will reply saying they will try to borrow money from a friend or relative, get a title loan, or skip some of their least important bills like the cable bill or phone bill. Even the electric bill falls below rent when you think about it. You can easily but uncomfortably live without power. But you’ve got to have shelter.

Now if they really are in a nasty situation then this opened the door for your next conversation with them when they don’t pay which will be telling them something like this.

I am going to have to file an unlawful detainer in court. Tomorrow is the day the court gave me to file my UD’s on anyone who hasn’t paid. As you guys know I like you and I want you to stay. I was hoping you guys would stay with me as your landlord for years to come. I will do everything in my power to get a continuance from the judge if you show you that you guys are serious and want to get caught back up but didn’t have it all by the first court date. But as I’ve told you before, I’m not rich. Ive got an unbelievable amount of bills to pay and I have to have consistently paying residents. That’s the only option I have.

That statement does several things. One thing is it keeps the communication positive and doesn’t get them mad at you. You don’t want your tenants mad at you as some of them will tear your house up on the way out. It’s not in your businesses best interest to end the relationship on a negative note. As I said before. There is a game you have to play. If you play it right things will be relatively easy. If you play it wrong you will have a continuous battle and you will hate being a landlord. Even if you do play it right you still from time to time will get some real bad ones. You will minimize that to a great degree though if you make the right moves.

Note that I also told them that the court gives me a date to file my UD’s. I say that because it prevents them from trying to get me to give them more time. I like to go to court the least amount of times possible. So I prefer filing all my UD’s at once. And if they think that the court gave me a date and I only get one date it’s unreasonable for them to ask me to wait another month to file.

Do yourself and all other landlords a favor and tell your tenants the order of priorities when they move in. Food is first for survival. Shelter is second. Everything else is beyond that. Don’t be an idiot and pay them in the wrong order.

Hmm, Christmas Presents For Favorite Tenants!

0 comments
Christmas time is coming up and it’s about time to start thinking about your companies yearly plan to hang on to your good tenants. Do you have a “good tenant" retention plan in place? If not, should you consider one?

Over the years I have heard many landlords tell me about their retention plans that they feel work. First things first you need to define a good tenant. For my retention plan a good tenant is a tenant that has paid their rent on time each month for the past 12 months. After the first year of on time payments they get 10% off a month of rent. 2nd year they get 25% off and the 3rd year they get 1 entire month of rent for FREE. I don’t want to keep track of it because it would be a pain for the amount of tenants I have. But if they notify me I will check the records and give it to them.

Other landlord buddies of mine will give their tenant a Christmas present. I have heard these presents being all over the board in cost. I would suggest giving them something inexpensive like a gift card for a couple movie tickets. They will value you being their landlord just as much with a couple movie tickets as they will from you buying them a new TV which to me is insane and unnecessary. They aren’t your children.

The other retention plans that I have heard of which are good consist of giving your tenant, after a year of on time payments, a choice of 1 out of 3 possible apartment or house upgrades. This tenant retention method gets your house fixed up with nice things and makes them feel like they are living in a fixed up unit rather than a dump that you never put any money into. Those gifts could be things like pick any 1 room to be painted, an upgraded nice kitchen or bathroom faucet, or a new ceiling fan, etc.

Even though I can think of several of my tenants that would like it, you may want to skip on the travel size Tranny Love Doll.

Simplified Bookkeeping for Investors

0 comments
I sure would like to see the IRS tapered down in size by implementing some modified version of the fair tax or flat tax. Abolishing taxes all together for businesses is an even better idea. Crackpot idea? No… Its a good idea.

A great deal of people are actually out there with the misdirected preconceived notion that businesses pay taxes. Think about it for a minute. All costs of doing business, it doesn’t matter what it is, gets built into the cost of the product or service a business sells.

An educated business owner is not going to continue to take hits to their personal finances due to any increased cost of doing business. They will either streamline their business in one way or another, make employees be more productive and work harder, or raise the cost of the product or service. There aren’t many other options.

As of now the US tax code is 74,608 pages long. And it’s getting much larger every year that goes by. But as of now, we have to continue to deal with it.

Meetings where members are teaching us their tricks of the have always been popular. And this week that’s what we’re doing.

Our President, Andy Stowasser, will be teaching us the simplified bookkeeping techniques he uses for his company. As you can see, bookkeeping  taxes, etc are by far my least favorite topic.

However they are currently necessary and if there is absolutely anything that anyone can teach me to make it faster and easier I’m all ears.

Come on out and see if you can learn a few tips that will make your life easier and save you some money.

And bring a friend with you. Guests are always welcome.

Tuesday, November 24, 2015

Confucius Says: To Mediate or Not To Mediate

0 comments
First of all I would like to publicly thank our president Andy Stowasser for being a nice guy and emailing me the name of our speaker. You should thank him too because he just saved you from having to read a book worth of information I was getting ready to write instead of this agenda. I’ll keep it short and sweet this time :-)

This week in The REI of Virginia Educational Institute we will be challenging the question, to mediate or not to mediate in our unlawful detainer court battles.

Our guest speaker will be Certified Court Mediator, Donna Chewning. Donna will be at our meeting to talk about the benefits of mediating our Unlawful Detainers. We will obviously also discuss the disadvantages.

This is a good meeting for REI to host because it’s a great time to talk about both the advantages and disadvantages of the use of mediation.

I can comfortably say that landlords in Roanoke overall don’t like to mediate as a result of failed mediation agreements in the past. The judges often tell the courtroom that the contested hearing dates are a couple months down the road to ensure that people will be motivated to mediate. However it’s extremely common for the tenant to not live up to the terms of the mediation agreement which will also dramatically slow down the timeline of removing them from your house so you can get a good paying resident.

As we all know, if you tell your bank, the tax man, your insurance company or any of the other creditors you have that you are going to be late because your tenant won’t pay you…… they reasonably won’t care.

This meeting will allow us to brainstorm for possible terms within the agreements that we can incorporate which will help ensure compliance. Here’s my on my own idea that didn’t end up working out. At the rehearing of one of my several failed mediations I asked the judge to hold the tenant criminally in contempt of court for breaking the court agreement to pay me. I will bet that I’m probably the only person who has ever asked him that as he seemed surprised to hear it. And he said no as I expected.

For those of you who haven’t learned this important life skill. If you don’t ask, you won’t get. And that counts for every aspect of your life. From when you’re low-balling a deal to asking the judge for a particular ruling in a court proceeding. And it is the exact opposite for people like me who are always asking. Those who continually ask for unconventional things end up getting unconventional things. Think about that for a minute.

Now back on track…

As most of us have found, when a resident fails to live up to their end of the mediation agreement, they will not be held accountable for their actions. Even though we have held up our end of the agreement by paying the seemingly never ending costs of owning good habitable property for them to live in.

That being said, there are areas that we should brainstorm to see what we can come up with to make these mediation agreements stronger and more effective for the property owner. Unfortunately as it currently stands, the negatives of court mediation far outweigh the positives. Our task at hand will be to figure out what we can incorporate into these agreements that will make them a benefit to all parties rather than just a time extension for the tenant.

Come on out, it’s going to be another fun meeting.

See you there!

Wednesday, November 11, 2015

Towing Notice

0 comments
Do you have a house where there is a car parked illegally, or a car that a tenant abandoned, or a car that keeps getting driven up in your front yard on the grass? In Virginia, by law, a landlord has to give a resident 24hrs notice before you have it towed. See the notice below that I tape on my tenants vehicle if they are being a PITA. Our member Robert Young (Robert Young's Towing) will tow it off your property for you at no charge. Just make sure you leave the proper notice. The tenant will be charged to get their car out of impound. Those notices typically get some pretty quick action from tenants that you keep having to tell to stop parking in the yard.

 Ohh Yea, if you have a train or an airplane or anything like that you want towed he can do that too.


Click on the image and it will become larger.

Monday, November 9, 2015

Sweet Justice…

0 comments
You rented to this family that you were confident were good honest people who will make themselves a home in your property for several years to come. You did a background check on the Virginia court system and they turned out to be crystal clean. Not a single crime, eviction or any form of debt owed by them.

What a lucky find you thought to yourself as you left your lease signing meeting. These ones are good. And they absolutely love the house. You and them walked through it and thoroughly inspected it to ensure everything is in good working order. Their kids are also remarkably well behaved for their age. Finally some good residents in this particular house that has seemed to be a continual source of problems.

3 months go by. Rent has been early every month. Then the 4th month comes and you haven’t heard anything from them. No rent payment, no text or call to let you know that there is an issue. So you contact your tenants several times and there is no answer. Maybe they have a different phone now because there is no voicemail.

You send out a 5 day pay or quit notice as required by law in Virginia when a resident is behind on rent. You still hear nothing from them. The only person who ends up contacting you by mail regarding this property is a city code enforcer. Wow, what a nasty letter he sent. And they didn’t even call. You had no idea that there was even an issue. You are now being held liable apparently for damage that the tenant caused to your rental.

That same code enforcer was in the house right before they moved in to do a rental inspection. And after completing a list of nit picky items you passed your inspection with flying colors. Your insurance company came out and did an inspection as well a few months prior to this.  They gave you a little list and you completed it. And a little over a year ago your house had a section 8 inspection for the last tenants. 

The point is, your house has been inspected time and time again. It’s actually one of the nicest houses in the neighborhood considering the fact that the owner occupied property around it has never been inspected.

You find it extremely irritating to get this love letter in the mail from code enforcement that threatens they will fine you $2,500 and put criminal charges on you for renting an unsafe property to these poor tenants. Especially considering the fact that that particular code enforcer was just out there a few months ago giving you a rental exemption certificate. They know exactly what kind of condition that the house was in when they passed it. And instead of holding the tenant responsible for the damage that they caused to the property, they threaten you with fines and criminal charges.

You look at the list of extremely unsafe items that they listed to warrant such extreme action and you see a very small crack in the sidewalk that they are calling a trip hazard. It was there during the initial rental certificate inspection and neither you nor the code enforcer noticed it then due to its insignificance. But since the code enforcer now is working with the tenant to destroy you it has become an issue.

They also listed one outlet in the house that went bad. So there is one legitimate complaint. But nothing that should require anything more than a phone call so you can send maintenance over to take care of it.

Ohh, and an outlet plate that is missing off the wall. It was there before. There are also smoke detectors that have been taken down and a couple missing globes off the light fixtures. The tenant says you rented it to them like that but that code enforcer knows that they wouldn’t have passed it the first time without them. But they are there to protect the tenant from you not protect the tenant from themselves. So they wrote you up for it. Especially since missing globes off light fixtures is such an extremely dangerous situation. Don’t you love living with this degree of tyranny? I don’t know how I would even run my life without the government guiding me through it.

They also wrote you up for moldy caulk in the bathtub. Apparently the tenant doesn’t know how to clean as that caulk was brand new when the rental inspection was done. And they wrote you up for some roaches too. Roaches that also weren’t there when they moved in.

You have in the past talked with their supervisor and he doesn’t agree with you that the tenant should be held accountable for their own actions. You also have talked to the city manager and several city councilmen about it. They also don’t agree that the tenant should be responsible for what they did. “Because it’s ultimately your house.” That’s what you keep hearing from these clowns.

You still haven’t heard anything from the tenant and you refuse to go in the house and fix a single thing that they have done to it while they are living in there. If you did they will likely damage it again. They aren’t paying their rent and obviously by the way they are ignoring you they have no intentions of doing so.

So the 5 days passes and you quickly file your Unlawful Detainer to put them out. You get a court date set for a month later. Over the period of time of waiting for court, you get a second love letter from the government. This time it’s from a police officer beating on your door. He is trying to hand deliver the note to you and confirm he brought it with your signature. Personal hand delivery is required for criminal charges. Turns out this was a promise to appear in court from the lovely code enforcer.

Your court date comes with the tenant and they don’t show. You are thinking you have a default judgement against them. Finally, this is over. But when you get called to the bench, it turns out that the court accepted a letter from the tenant contesting any amount owed. Because they are saying that they shouldn’t have to pay anything to you considering the conditions that you made them live in. They said the reason they had to send a letter is because their boss wouldn’t let them get out of work.

So the judge sets a contested trial 3 more weeks down the road. That’s as close as he could set it since they are short handed on judges. You’re now almost 2 months into this without a dime of rent. And you’re still making your mortgage payment, tax payments, insurance payments and every other cost of owning the house. That code enforcer is still getting paid with those taxes you have been struggling to get together as well. It’s just you that’s not getting paid. And it’s sucking the life out of all of the good paying properties. The profit from them is having to be used to cover the losses from that deadbeat tenant and deadbeat code enforcer. And the future losses of advertising it for rent again, fixing the list of new items that the code enforcer gave you, as well as another good cleaning and paint touchup, dump fees for the crap they left behind, etc. The damages and bills far exceed the 1 month deposit you got.

A couple weeks alter and we are now at the criminal court case against you. You tell the judge there that you are in the process of putting the tenant out and once they are out you will jump right on any issues they caused. Fortunately the judge grants you an extension with no fine allowing you some more time to get this taken care of. The code enforcer was nasty in court. Acting like they didn’t just check the place and showing all of their court pictures to the judge. You are trying to be nice because you know that the judge doesn’t like it when you retaliate against the government. They prefer that you just shut your mouth and act like a good little boy or girl and do as you are told without questioning the motives of the code official. So minimization of the drama and good behavior is how you handle yourself. Even though you feel like you are really getting the bad end of the stick and are not being treated fairly.

Finally…. the trial date is here. You had to hire a lawyer because your property is in an LLC. And you can’t legally defend your LLC on a contested trial date. You could go on your own but you wouldn’t be allowed to cross examine the tenant and ask them questions. You also wouldn’t be allowed to subpoena the code enforcer or whoever you need to support your case. If you wish, you could go without a lawyer and serve only as a witness for your LLC. But you have a much higher chance of getting beat by this deadbeat so you just opt to throw down more money and get the lawyer.

The tenant gives this big story of how you’re a slumlord and how horrible it was living there. They seem to have forgotten how happy they were when they moved in. And how they filled out that move in inspection report and wrote that everything was in good condition.

They proceed to show the pictures of the damage that they caused. And this is why they tell the judge they shouldn’t have to pay anything. The judge knows what they are doing. They see it all the time. They ask them why it was that they moved in if it was so bad.

You ask the judge if the court has received money via tenants assertion to be put in the courts escrow account. It is required that if a tenant has a maintenance related issue, they pay the court their rent and the judge decides who gets it.

This shows goodwill on the tenants part. It shows that they do have the money for rent and do want to pay it. That they just would like some issues taken care of.

I have quite a few units. And I can tell you that in the past 10 or so years that I have been doing this, not a single time, has any tenant put money in escrow with the court. And not a single time has the court scolded the tenant or sided in my favor as a result of them not following the law.

However I can assure you that if a landlord makes a single mistake, such as forgetting to send a pay or quit notice or filing the Unlawful Detainer a day early, the court will immediately dismiss the case and side with the tenant. It’s not a fair even system.

So the judge says that they haven’t put money in escrow as far as he or she is aware. And tells the tenant that they can’t expect to live in the house for nothing. The judge ends up giving judgement to you after knocking off some of the money you are rightfully owed. I guess to make it seem to the tenant that they were being fair. They also grant you regular possession. Which means that they have 10 days to appeal the judges decision to start the whole process of getting a free ride in the house all over again.

So you wait for the 10 days and file your Writ of Possession to get the deputy out there to put them out. As long as they haven’t filed an appeal.

You had to file the Writ because even though you have judgement the tenant still refused to move out. And believe it or not, you can’t legally go down there and start moving their stuff out of your house. You also can’t turn off any of the utilities that you have agreed to have in your name. Even if they aren’t paying rent. Even if you have judgement against them. You can’t turn them off until they are out of the house. So they are having a party right now with your furnace and the windows. This is one reason why you NEVER pay peoples utilities. Maybe the water if it’s a multifamily house. That’s it!

The tenant has decided to hold down the fort and get every last day of free living off of you. A few days after filing your Writ of Possession, the deputy calls you and sets the date. And 2 to 3 weeks after that, the scheduled final day is set. You are now at close to 3 months since you have got a dime of rent from this property. And it’s going to take you a couple weeks after they are out to get it fixed back up. As well as a few more weeks to a couple more months to get it rented again.

Hopefully they don’t go back to the judge and get a “Stay”. Which is a thing that has been happening lately in Roanoke City. This is where the tenant tells the judge some sort of sob story and the judge cancels your Writ of Possession you waited so long for and sets another court date to rehear the case yet again.

The life of a landlord is not easy …….

Landlording is definitely not an easy form of investing. It actually can require MORE physical attention than any other investment that I am aware of. Other than a full blown business that you have hired yourself as an employee of as well as investor / owner.

However, if you take this seriously, and run your real estate investment like a real business, you can profit tremendously from your efforts. MORESO than any other industry that I am aware of. That’s as long as every single thing is done correctly.

Critical components to this investment are that you bought it right and got the price down low enough where you were able to obtain a good cash flowing property. Don’t listen to these fools that would call looking for a cash flowing property bottom feeding. Being a smart investor is not bottom feeding. That’s ridiculous.

Buying property that doesn’t cash flow can only successfully be done by the rich. Just because it doesn’t cash flow doesn’t mean that it isn’t an investment. Consider the fact that cash flow isn’t your only income from a property. There is what is called unrealized income. Do remember that your tenant is also paying off your mortgages as well as future repairs, taxes, insurance, etc.

However, those that aren’t wealthy and are blindly riding by the seat of their pants who buy non cash flowing properties will within a few years get chewed up and spit out by them.

Beyond buying cash flowing properties, good landlording also requires being quick to take people to court when they are behind. Send your pay or quit notices out right away and file your UD’s as soon as you can.

And a good landlord will treat evictions like the plague. When you see there is one you put all of your attention towards getting rid of it immediately. You stop the bleeding promptly without any hesitation.

The rest of your life can get put on hold to work around the critical dates. Critical dates being the date you send out your pay or quit notices once rent becomes late, and the 5 to 6 day later date you fill out and file your UD’s.

After all of that work you had to do to get that nasty deadbeat out. After being treated like a piece of garbage by the city employee who doesn’t realize or care that you pay their salary. They have taken their position of power to a mini dictatorship level.

And after all of that time getting run around in court with these games that your tenants and code enforcement like to play together. It’s nice to……. Finally…….. get the Sweet Justice you so greatly deserve. It’s time for your payback to that tenant that put you through the ringer.

And that’s where our Tuesday night meeting comes into play. We’re going to have or member and friend, Alvin Franklin speaking this week.

Alvin has mastered the art of debt collection. And he is licensed to do collections in the state of Virginia. I have been told by several of our members that Alvin is really good at skip tracing these people. Running them down to find out where they are working.

Alvin is going to talk about a few things. He’s going to talk about what he can do for our group regarding chasing your bad debt. He’s also going to talk about investment potential with him by investing in other peoples bad debt and letting him collect on it while working out some kind of split between you and him of the profits.

And with the skip tracing capabilities that Alvin has, he also has the ability to do thorough background checks on prospective tenants. Alvin is going to cover those bases as well.

So it’s going to be a fun meeting. You should consider getting there a little early to get a seat. There should be a good crowd of people.

See you there!


P.S. - If you know of a place that has some more room, and wants our business, please let me know at the meeting. We’re coming into our busy time of year and it’s going to be too small in our currant location throughout the winter.

Our criteria are:
* Serves all kinds of alcohol, hard alcohol included.
* Can hold ideally 90 people or more.
* Has reasonable prices for food.
* Full menu. Does not want to limit us to 3 or 4 pre chosen meals.
* Is Ok with taking the good with the bad, some of our members refuse to tip or order anything. Although most order and tip well.

We don’t need suggestions of what places MIGHT meet the criteria. It’s a lot of work to go around contacting the managers and talking to them all about it. And there is no paid person working for REI to do it.

It would be better if you just kept your eyes open and if you notice a restaurant you’re already eating at, that has a good sized room that could hold us, ask for the manager and tell them the good and the bad. Ask them if they are interested in our business and let me know if they are.

Thank You!

Monday, November 2, 2015

Cities All Over The Country Are Being Warned By Judges For Breaking The Law

0 comments
“If there is one thing that every American understands, it’s that government officials don’t have the right to enter our homes unless they have a warrant or there’s a true emergency.” A quote by the ACLU of Virginia Director, Kent Willis.

As many of you are aware, the ACLU sent the city of Chesterfield Virginia a warning letter a few years ago that they may NOT illegally enter a property for a forced rental inspection where the owner OR tenant has told them they don’t want them there.

Legally a government official that is not allowed on a property has to take a few minutes to obtain a warrant if the tenant or owner doesn’t consent to the search. And that warrant will require probable cause that there is likely a hazard of eminent danger within.

Roanoke City has been giving landlords criminal charges and fines up to $2,500 for those that have refused entry which has been proven by several lawsuits to be illegal and a violation of the supreme law of the land.  The Supreme Court has held that the Fourth Amendment protects the rights of tenants and owners to refuse warrantless inspections with impunity.

Kent Willis of the ACLU adds that “our Constitution demands checks and balances, and the check on code enforcement officials when they want to enter your home is judicial oversight.” The judicial oversight is the judge allowing or disallowing an inspection warrant based on wether there is or isn’t probable cause that there is a serious health or safety related issue within the property.

Cities across the country have been trampling on the rights of property owners and tenants and we now have another landmark court decision that took place in Portsmouth, Ohio.  Ohio landlords felt that rental inspections required to obtain a rental certificate were a violation of their Fourth Amendment rights due to the mandating of a warrantless inspection of their properties without probable cause that there is a health or safety issue within.  US District Court has yet again held rental property inspections to be unconstitutional and supported the rental property owners that filed suit.

REI of Virginia was able to obtain the 2 actual court documents that were filed by the Ohio landlords against the City of Portsmouth. Those of you who would like to see the motion for judgements that were filed, send me a request and I will shoot a copy over to you. These motions list several cases throughout the United States where cities have been reprimanded by judges for going beyond their legal bounds.

Unfortunately our government here in Roanoke City feels like they are above the law in not only this but several other areas. Even tough they have knowledge of these cases that prove they are overstepping the limitations put on them by the supreme law of the land. That darned constitution just keeps getting in the way of our local regimes desire for a police state governance with complete and total tyranny over the powerless minions.

REI of Virginia supports providing a safe and healthy environment for your residents to live in. REI of Virginia also supports the Constitutional rights that all citizens within the United States have.

The city is treading on very dangerous ground. They will be lucky if they don’t get faced with a massive Unjust Enrichment lawsuit to get back all of the money they have charged for these unlawful forced warrantless searches dating back to the initiation of the Roanoke City Rental Inspection Program.

I hereby request that the Roanoke City Government immediately terminates their unlawful inspection program making it strictly voluntary as it rightfully should be. All citizens have certain unalienable rights that no local government can take away. The entire Roanoke City code enforcement department and commonwealth attorney have been warned that they are breaking the law and have been given references to specific law suits for verification. Continuing to do so will be a clear sign of willingful and intentional neglect of the law which could lead to personal liability issues.

Real Estate Marketing Campaigns This Week At REI

0 comments
Hi Everyone,

This week we’re going to have a conversation about various forms of real estate marketing campaigns. We’re going to cover what works and what doesn’t.

Direct mail to various “people problems” who have a high propensity to contact you is one of the most effective forms of real estate marketing.
And to make that marketing most effective it requires a high level of personalization. Which can be done on your personal computer with a data merge or on a variable data printer.

One trendy type direct mail campaign that has been popular with real estate investors for the past 10 or so years is called the Yellow Letter Campaigns. There are many versions of Yellow Letter Campaigns are out there these days. Many of which were designed by people who have no marketing experience.

At this meeting we will cover various campaigns and will talk about what works and what doesn’t work. And what type of content within the marketing will motivate a person to pick up the phone and let you give them an offer on their house.

I get a 25% response rate on the real estate campaigns my advertising agency created which are not Yellow Letter Campaigns. The average direct mail campaign gets a .5 to 1.5 % response rate. Good advertising is all about content, personalization and getting your company in front of the right people with highly targeted marketing. Lots of money is wasted by marketing amateurs blindly throwing piles of s*** at the wall to see what sticks. We’re going to cut through the ineffective garbage in these campaigns to show you want works and what doesn’t. A good integrated marketing communications program is essentially a road map to get from point A to point B the most efficient and cost effective way.

Come on out this Tuesday to get some tips on effective real estate marketing. And don’t forget to vote. Elections are Tuesday as well…

We’ll see you there!

Monday, October 19, 2015

Pricing Damages In Your Rentals

0 comments
Hi Everyone,

We have a really interesting meeting this week that Roger and Amanda will be leading. The topic will be pertaining to determining how much it costs to fix various common damages that your residents leave you with at the end of a lease.

REI of Virginia suggests having tenants sign a detailed pricing list of what you will charge them on a wide array of potential repairs. This helps eliminate arguing during or at the end of the lease with residents about what they feel like something should have cost vs what it actually cost.

Our objective is to develop a comprehensive list of potential repairs and prices that one could reasonably expect an REI contractor to do those repairs for. We intend on getting the repair prices signed off by an REI contractor to ensure that they are within the realm of being doable.

Come on out. There will be some great information that will come from this meeting!

See you there…

Sunday, October 4, 2015

Help For Veterans To Prevent Homelessness This Week At REI

0 comments
Hi Everyone,

City Councilman & Veteran Bill Bestpitch contacted us a few weeks ago about a program he is in charge of that helps veterans from becoming homeless. Some of you may be aware that this program has been around for a year or so. Last time they came and talked to us there were some funding issues and they ran out of money really quickly. I was assured by Bill that those issues are now resolved.

What this program focuses on is both homelessness prevention and rapid rehousing. The rapid rehousing part of this program that concerns landlords is helping vets find a home. It helps them with their first months rent and deposit and possibly the first few months of rent until they are established and back on their feet with employment, etc.

Regarding the aspects of homelessness prevention, the program helps vets get back on track if they have fallen behind on their rent.

This week Bill will be sending out his team that implements the program. They will cover all of the details of this great program and how you as a landlord can participate.

Unfortunately I’m going to have to miss this one due to having metabolic surgery on Monday. I’ll be in the hospital for a few days and will be out of commission for a week or two after. This surgery will reduce if not completely eliminate my ever increasing list of weight related health issues including things that will eventually kill me such as diabetes, high blood pressure, sleep apnea, high cholesterol, etc.

Statistically the odds are good that I will live through the surgery. Only 2-5 out of 1,.000 die within 3 months of having it. However the odds are very high that I will die young if I don’t have it due to my comorbidities and the poor statistical probability of a successful lifetime fight against genetic & metabolic issues related to inadequate production of the hormones leptin and ghrelin.

I’ll see you at the following meeting.
 

Real Estate Investors of Virginia. Copyright 2009 All Rights Reserved