Update on the rental house i bought for $75k (bank was owed $125k)

berettafan · 03-06-2009, 03:30 PM

Good news is we closed about a month ago. Bad news is bank wanted cash down so we brought in a 3rd partner. Still 1/3 of the eventual profit (or equity) is better than 0/0.

Anyways I listed the house for rent on Craigslist and had my partner's brother in law paint the place. No serious responses for a couple weeks and was just about to go with the newspaper ad. Then last Sunday morning my wife picks up her phone to read a text and says 'OMG _____'s house burned down this morning!'. Three middle schoolers (my wife teaches at the school) being raised by there partially disabled grandmother and somebody left a curling iron on when they went to church.

Well guess what, we have a very grateful tenant now! I couldn't be more excited about this family moving in. From a pragmatic perspective the state is going to be paying the entire rent which, by design, covers the mortgage, interest on the 3rd pt's investment, taxes and insurance. Those checks are ALWAYS on time and ALWAYS clear. From a humanitarian perspective this is a lady who deserves the assistance she's getting as the kids she's raising are good kids in spite of all that they have gone through (not giving details but a sad story). One of the boys actually called me ON HIS OWN and thanked me for the house. I didn't know what to say other than 'don't thank me i'm just happy to have tenants'. The grandmother was near tears when i talked with her. Just an amazing situation.

Previous to this the family lived in the very worst part of town and the kids had to navigate some pretty rough areas to get to school. Now they are in a much better 'hood (not perfect mind you but MUCH better).

I've done nothing more noble than try to make a buck but in this particular case the system is working and very possibly keeping 3 kids from becoming future career state aid recipients.

It's sobering to think that it's just my dumb luck and this family's tragedy that has put this investment on the right track but i'll take luck any day.

Seahawk · 03-06-2009, 04:30 PM

Good stuff.

Laneco · 03-06-2009, 04:41 PM

Funny how things work out, isn't it?

They lose their home but then get to live in a better place. You needed a tenant and got a good one.

Have a terrific weekend~

angela

MRM · 03-06-2009, 04:58 PM

Let me get this straight. Your tennant's last house went up in flames. You are now renting to them because they need a place because their last house burned down. Did you mention that you're renting to a family that burned down their previous home?

I am jesting. I couldn't resist. I am delighted it is working out so well for you and the tennant. Enlightened self interest means beaing able to do well when you are doing good, and it is the American way. But please do make sure you have plenty of insurance.

fastfredracing · 03-06-2009, 06:02 PM

Congrats, we just rented to a family that was in a rental house that went into foreclosure. They had been living there for over 3 weeks without running water, and the bank was trying to force them out. It felt good to be able provide them with somehwere to live. Tough times we are living in .
Good luck in the rental buisness.

CRH911S · 03-07-2009, 08:16 AM

Instead of "state" insert the words "you and me." Why? because that's who is paying the mortgage.
Regardless, thanks for the good deed and power to the recovery...

berettafan · 03-07-2009, 08:54 AM

You got it CRH.

So i figure if i'm going to be paying this money in I might as well get some of it back.