The Community Reinvestment Act is important to provide fair access to credit and investment, and many financial institutions agree it’s an important tool in their business strategy. But current guidelines render it ineffective, and it’s time regulators institute much-needed change.



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I used to think that I knew what nightmares were. Then I became a landlord. I’ve seen so many types of nightmares since I began this landlording journey, things I did not even know could exist. I’ve seen mold so thick it even covered the spider webs. I have seen rotten floor joists holding up tubs and thought, if the tenant was only 10 pounds heavier, then crash! I have seen squirrels trapped in the walls and clumps of roaches coming out of refrigerators when you open them. But I have discovered that people create the biggest nightmares.

People can do some really crazy, nightmarish things, and most of the time, you would neither know nor care about what they are up to. But when it is your tenant in your property doing it, then it becomes, at least in part, your nightmare.

12 Tenant Nightmare Stories I Swear Are Actually True

Here are just some of the more memorable tenant nightmares I have had. I swear to you, every one of them is true. Even the mind of Steven King could not make some of this stuff up.

  1. A tenant was handing out flyers for porn parties at his apartment. “Bring your own video!” Another tenant saw it and informed us. That is not something you want your address associated with.
  2. A tenant constantly had loud arguments with her boyfriend. She tore every door in the house off its hinges by slamming them.
  3. A tenant installed a stripper pole in the living room. Screwed it right into the hardwood floor. But it was just for exercise.
  4. A tenant got blackout drunk, passed out, and left her kitchen sink running in an upstairs apartment. All that water eventually made its way downstairs.
  5. A tenant got blackout drunk, bumped his gas stove and accidentally turned the gas on before passing out. Another tenant in the building smelled it and called the utility company, which then turned off the gas to the whole building. That in turn created another sort of nightmare. Thankfully, he did not smoke. He was not supposed to be there, by the way. His mom had rented the place surreptitiously for him. I wonder why she wanted him out of the house.
  6. Speaking of smoking, one tenant burned my triplex down because he was sure the cigarette he placed in the trash can was out. Thankfully, no one got hurt—and at least he apologized.
  7. A few tenants were selling cars off the back lawn. “What do you mean we can’t do that?!”
  8. I once rented to a tenant who turned out to be a hoarder who abandoned the property in the middle of the night. They never leave any good stuff.
  9. A renter who turned out to be violent broke out all my windows after a Memorial Day bender and ended up in jail. You would think it would be easy to serve an eviction notice to someone in jail.
  10. One tenant neglected to call us when the heater went out. He just used his stove instead. “I did not want to bother you.”
  11. Another tenant was apparently having real nightmares and spent hours every night screaming as loud as she could. I think my other tenants in that building had a worse nightmare than me on this one. Thankfully, I think she ended up getting the help she needed, and I hope she is in a better place.
  12. Finally, there was the woman who was “just having fun” by shooting her pistol out of the back window of her apartment.

Still Want to Be a Landlord?

Here is the thing, though: We did not create most of these.

Many of these nightmares were not our own creation. By that, I mean that most of the nightmares I describe came with the property when we bought it. We inherited them. It was these nightmares that likely made the property a good deal to buy. The landlord wanted to get away from these nightmares by selling. The lesson here is this: Some folks say that a tenant is lying every time they open their mouth. I say the landlord who is selling is lying every time he opens his mouth. “They are all great tenants.” “Everyone pays on time.” “No problems at all.” Yeah, sure. Don’t take their word for it.

These nightmares are unfortunately part of the business. As you grow and buy properties, tenants who have not gone through your screening process come into your life. Sometimes you will know what you are getting into, and sometimes you will not. These tenants will eventually go away, but it can be nightmare in the meantime.

Some of the nightmares were our own creation. Sometimes you just have to learn the hard way. You have to learn from experience that there are red flags to look for during the tenant screening process—things like the long sleeves in the summer, the alcohol on the breath during a showing, and the parents who seem way too eager to get a place for their kid. These are all signs that perhaps something is not quite right.

If a nightmare gets passed you, all you can do is learn from it and move on. Change your lease, change your policies, or change your screening criteria to prevent the same from happening again—and remember that hindsight is 20/20 for a reason.

To close, let me say that we have had and continue to have many good tenants who we are very thankful for. In fact, most of our tenants have been decent, prompt, and respectful folks. But you always seem to remember the bad ones, don’t you?

We’re republishing this article to help out our newer readers.

So, let’s hear it. Do you have a story of a nightmarish (or conversely, awesome) tenant experience?

Share below!





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As housing becomes less affordable, the definition of homeownership just might become more flexible. Homeownership investment companies are popping up around the country, offering cash to homeowners for the opportunity to share in the appreciation of their property.



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During Daisy Lopez-Cid’s tenure as NAHREP president, she has facilitated the launch of new chapters in strategic markets, including Puerto Rico, Boston and Philadelphia. Her efforts have contributed to the organization’s unprecedented growth, as more than 10,000 professionals have joined NAHREP over the past year, a 50% increase over last year.



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Continuing where we left off from last week’s episode, this show discusses increasing your income by recognizing existing opportunities and making your own opportunities through side hustles.

The show progresses through investing basics, both traditional stock market investments as well as real estate investing. (This is BiggerPockets, after all.)

Do you have your spending under control? This is the show that takes you to the next step in your journey—increasing your income to grow your wealth.

Click here to listen on iTunes.

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In This Episode We Cover:

  • Tips for increasing your income
  • How to be better at your job
  • The importance of getting your health in order
  • The concept of self-education
  • The benefits of reading books
  • How to save more and cut your lifestyle expenses
  • Playing to win versus playing to not lose
  • The good thing about side hustles
  • The concept of “buy low and sell high”
  • Why you want to become an online authority
  • What you need to do right now
  • The importance of having an exit plan
  • A discussion on investing
  • Two types of investing
  • Scott and Mindy’s view on diversification
  • The 1 percent rule
  • And SO much more!

Links from the Show

Books Mentioned in this Show

Tweetable Topics:

  • “I think doing the bare minimum is a recipe for mediocrity.” (Tweet This!)
  • “There are a lot of opportunities. If there aren’t, you can make them.” (Tweet This!)

Connect with the Scott and Mindy





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In the last year, multifamily investment activity in Los Angeles hit its highest level ever. According to a CoStar report and an article by The Real Deal, there were $10 billion in apartment building sales from June 2017 to June 2018 with a record average sale price of $275,000.



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China Vanke agreed to take a 4.9% stake in Cushman & Wakefield ahead of its upcoming $6 billion IPO. This news comes on the heels of a recent trend of Chinese investors vacating the U.S. real estate market, divesting their assets at the behest of Beijing.



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Does the recent upsurge in rent control initiatives and advocacy mean I could be making more selling my current residential investment property? Does that seem upside-down? Don’t forget, there are two sides to every coin.

The Scoop

Lawmakers and rent control advocates are currently working to repeal state laws forbidding rent control to revive the practice in states across the country. Illinois, California, and Washington are gaining some foothold in their efforts to reinstate the practice in an effort to control housing costs. In Oregon— in spite of a narrowly defeated 2017 measure — the concept is gaining ground in cities with drastically increasing rents and limited housing availability. This is especially the case in the lower-income ranges.

Related: Why It’s Time to Consider Adding Rent-Controlled Properties to Your Portfolio

Any undergraduate student enrolled in a Microeconomics 101 class will tell you that people respond to incentives. Rent control seeks to place an artificial price ceiling on a good or service (in much the same way that minimum wage places a price floor on wages). On paper, this policy caps rent prices so investors reach an artificial max limit, while renters enjoy a cap on the costs they’ll incur. However, like any economic policy, there are always unintended consequences. In the case of rent control, this policy changes the incentives for investors to invest in the market.

The Downside

By placing an artificial ceiling on the revenue stream of the investment, rent control also places a limit on how much most investors are willing to invest. Having limited gain potential while maintaining complete risk of loss means investors will contribute less in these markets as they seek higher returns elsewhere. People respond to incentives. Investors are less likely to both purchase properties and perform repairs and maintenance at the level they might in other markets. It also means many investors will simply take the next exit and invest in other markets.

The Repercussions

As funds flee potential rent control markets, investors will seek opportunity in other markets with less government interference. This creates a golden opportunity for investors in non–rent control markets to sell at a higher price.  If rent control dies in these select markets, I predict a bit of a price correction downward in non–rent control markets.

If you have considered selling your investment in a location that investors fleeing rent-control areas might find attractive, now may be the time. The largest exodus is most likely to occur before the election in November. Perhaps you are considering a 1031 exchange, retirement, or a host of other reasons. Now is a great time to sell.

Related: How to Raise the Rent on Your Tenants as Painlessly as Possible

Another attractive option is selling your current property in an area further into its growth cycle and leverage that property into areas of newer growth. In many newer-growth areas, the ratio of rents earned to initial capital investment dollars may be significantly higher than your current property. This allows you to multiply your investment by distributing that capital into multiple properties in these areas of reduced initial investment entry. The result is a more diversified investment portfolio across multiple markets and property types. This strategy can seriously improve your cash flow and IRR.

What do you think? Is rent control a blessing or a curse?

Share your opinions below!





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Americans are beginning to shift their investments to other areas as real estate fell not one but two spots from being the top investment choice back in 2016. Americans across all ages said that real estate is their third pick for the investment of money they won’t need for more than 10 years.



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It seems “you need to read Dave Ramsey” is a cornerstone of financial advice given lately. Because I have not read a basic financial book in a while, I thought I should see what all the hoopla is about. I picked up The Money Answer Book and delved into it, hoping to be enlightened by some Ramsey logic.

First, Dave Ramsey does not seem to be saying anything Suze Orman hasn’t been preaching for 15 years. In fact, this is the same basic information that most conservative financial advisers regurgitate. It isn’t my belief that advice has to be “new” and “edgy” to be worth entertaining. However, I prefer my gurus to be unique in their guidance. It seems odd for someone to be so boisterous about their opinions when it is the same thing a handful of other people are spouting. That being said, I think The Richest Man in Babylon is one of the best financial books ever written. Basics are basics, so I tried to keep an open mind.



Related: The Dave Ramsey Dilemma: Should Real Estate Investors Really Avoid Using Debt?

What is Dave Ramsey’s Advice Good for?

There are some people who absolutely need to read and follow Dave Ramsey’s advice. These are people who have very little financial knowledge or discipline. I was a bankruptcy paralegal for many years. I saw what debt, when used improperly, could do to someone. Ramsey provides solid advice for doing whatever is necessary to increase income, build an emergency fund, and use the snowball method to pay down debt. If someone is unfamiliar with these activities, by all means, read Dave Ramsey—or almost any other conservative financial adviser.

Our society is one that is wrought with consumerism. As I write this, Christmas still lingers in our memories. It sickens me to see people pile on debt to buy mostly useless items—or even worse, the families destroyed with guilt because they can not provide “adequately” for Christmas. If you find yourself drowning in credit card debt, Dave Ramsey is a good place to start to dig yourself out.

Nevertheless, there are several areas in which his advice is lacking.

Everyone is an Idiot (or Moron)

Granted, this is not about his advice, and he may be the smartest person in the world. However, with someone giving subjective guidance, I have a problem with them referring to anyone who disagrees with them as an “idiot” or “moron.” These are opinions about the best course of action. Just because you write a few books and consider yourself an authority, it does not make all other opinions invalid because they contradict yours.

There is No Such Thing as Good Debt

In referencing “good debt” and “…people believe that you receive great benefits by going into debt,” Ramsey writes, “[g]ive me a break! These guys are idiots. What’s more, they are probably broke idiots.”

Those of us in the Rich Dad camp strongly believe in leveraging assets to buy more assets. I understand that some people want to get rid of all debt, and that is a road you are welcome to take, especially as you near retirement. However, if you have $100k, you could buy ONE house for cash and carry no debt, or you could leverage that money and buy FIVE houses, with 20% down, exponentially increasing your income.

There are investors from both sides of this argument, and it is really a matter of personal preference. However, I would not assume the guy that leverages assets is a “broke idiot.”

I also know some people are going to argue how leveraging burned a lot of people in the 2008 crash, which is true. Over-leveraging is a dangerous game, but an income-producing property is still an income-producing property, even in a crash (assuming you still have tenants), if you set it up right in the beginning. Utilizing HELOCs and adjustable rates are what will burn you when the market slides. It all comes down to structuring the deal.

short-sale

Credit Cards Are the Devil

“Responsible use of credit cards does not exist. There is NO positive side to credit card use.” —Dave Ramsey.

Again, I will point out that I have seen that credit cards, when used improperly, can wreak havoc on a person financially. Growing up, I too was preached at about the evils of credit card use. Not that it matters, but I also believe the introduction of credit cards into the marketplace has been a downfall and large contributor to inflation and the current financial mess our country is in.

On the other hand, credit cards are a part of our society, and more importantly, they are a huge factor in how our credit scores are calculated. You can absolutely use them responsibly and receive great benefit from doing so.

I have recently done a great deal of research on credit scoring and am curious if anyone in the comments would mind chiming in if they have achieved an 800+ credit score with NO credit cards. A mix of credit is necessary to maximize your credit score, and I am not sure it is possible to do so with no revolving debt. I would love to be proven wrong, though.

Related: Dave Ramsey is Wrong: You DON’T Need to Be Debt-Free to Hit Financial Freedom

Of course, Dave Ramsey says, in reference to re-establishing credit after bankruptcy, that you should not re-establish credit (specifically through low limit credit card use) because you should not plan on getting back into debt. Also, mortgage lenders are more likely to lend to you if you avoid credit cards.

It has been my experience that mortgage lenders care about your credit score and your use of credit properly. I have yet to see one scoff at someone for utilizing credit cards, especially when it fattens a borrower’s credit file and score. More importantly, it is almost impossible to qualify for a mortgage if you have made no effort to re-establish your credit.

I could go on and on, but I already feel people picking up their pitchforks. I may just have an aversion to gurus and people who act like they know everything. “Live below your means, save as much money as you can, maximize your 401(k), and carry no debt but your mortgage” is good advice for a lot of people. Certain aspects of that is good advice for everyone. You should absolutely save money and have a financial cushion, but make your money work for you to achieve more than just a frugal life. Also, you must learn how to play the credit game, unless you plan on only surviving on cash for the rest of your life. Living on cash isn’t a bad thing, but it limits your options, especially regarding real estate investing. I won’t even get into the evils of 401(k); that is a completely different discussion.

Most importantly, understand that anyone can write a book and it does not necessarily make them an expert on everyone’s circumstances. Gather tidbits of knowledge from multiple sources and see what works best for you and your situation.

We’re republishing this article to help out our newer readers.

Weigh in: Do you agree with this assessment, or are you a fan of Dave Ramsey’s mantras?

Comment!





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