From: daniels_d@apollo.HP.COM (Dave Daniels)
Subject: Re: Help needed with Rental property
Date: Fri, 24 Jul 1992 12:35:15 GMT
Organization: Hewlett-Packard Company, Chelmsford, MA

In article <19049@fritz.filenet.com>, asylvain@felix.filenet.com (The Chipmunk) writes:
|
|> : I am looking for some help with my particular situation.
|> : I presently own a condo with a loan of 68,000 on it 
|> 
|> Seems your monthly payment ought to be in the $500 range, am I right?

 Nope your wrong it's worse about $750 including taxes and PMI

|> 
|> Jees, and you can only rent it for $200?  (refering to $300 negative)
|> WOW!  (Or is it the HOA fees that are killing you?  That'll do it
|> sometimes!)
Paying $750 and can only rent for $500 a month $250-300 negative

|> 
|> If your payment is MORE than $500/month, REFINANCE!  NOW!

 I would love to refinance, but there is no way I can get it appraised
 anywhere need what I owe on the mortgage.

|> If you are thinking about a condo as an investment, get a 30 year loan.
|> Always, always, always seek to keep your expenses at the barest minimum.

 Yes I agree but, the difference between a 15 and a 30 year is about $41 so
 it really doesn't make a whole lot of sense.  If you figure in 5 years you
 want to sell, with a 15 year you would have paid off about $4000 comapred to
 $450 for a 30 year towards the premium. 

|> : we would be looking at about $350 a month including 
|> : taxes, and condo fees. We could then easily rent it for $600 a month with a 
|> : positive cash flow of $250 a month. The idea is, this would offset the other
|> : condo and we would have a much easier time recovering when the market picks 
|> : up (we hope). 
|> 
|> Arruughhmhmmm ... I dunno.  Banks don't go for one property offsetting
|> another one, not anymore.  The property has to stand on it's own "two
|> feet" so to speak.  You could tell 'em you're going to live in the first 
|> one and rent the second one.  They'll go for that.  You're allowed to
|> change your mind after escrow closes.
|> 
|> And indeed, you may want to consider doing just that.  How badly do you
|> want to get into a house anyway?  Clearly you can afford the original
|> condo, since you must have bought it for > $68k in the first place.  Just
|> live there and consider the costs to be nominal for living somewhere.
|> At least you can still write off the interest and tax portion of payments.
|> 
 We want a house pretty bad, I think what we are considering know is to put
 our money towards a house and try to pick up a foreclosure at a great deal.
 Talking to our real-estate agent she believes the condo market has not hit
 bottom yet, where houses are pretty much there.
 
|> Have you considered leasing?  There's been a bit of a thread on that
|> subject here recently.  In a nutshell, if you can find a buyer willing
|> to lease for 2 or 3 years, you should be able to negotiate a larger-
|> than-market-rent leasing agreement, applying that in effect to the down
|> payment.  That will help reduce the negative cash-flow situation.
|> 
 We haven't really considerd this but maybe we should.
|> -- 
|> The Chipmunk.
|> Opinions are mine, batteries not included, void where prohibited.
|> In America, any boy may become president and I suppose that's just one
|> of the risks he takes.  -- Adlai Stevenson

-- 
---------------------------------------------------------------------------
Dave Daniels                           | 
daniels_d@apollo.hp.com                | "Life is a highway, and I wan't  
Hewlett Packard, Inc.                  |  to ride it all night long...."
(603) 772-1500