The beatles Case Study

[begood]

beatles if you can say with a straight face, in big bold print, in all caps, that "NO ONE IS CHEATING THE IRS OF ANYTHING", then I really do think you are deluding yourself.

YOU are cheating the IRS right now. You owe thousands of dollars in unpaid taxes. That's what they are. It's not a "scam". You didn't pay. That's cheating. Wake up.

[honeybbq]

6.) Mrs. Beatles could work nights and weekends but isn't.  If we were in this position I would be working every hour I could when my spouse were home.

Don't forget Mr Beatles won't delivery pizzas either because he can't get in and out of his car that much. Maybe he has a real disability but it sounds like an excuse to me (since he hasn't mentioned a real physical disability).

Actually I did.

You just don't want to bother to read it.

the only thing you said about delivering pizzas is that you can't get in and out of your car that much.
Please point me to the post where you described the physical disability (I may have missed it, there are a lot of posts) and you will get a real apology.

[The beatles]

6.) Mrs. Beatles could work nights and weekends but isn't.  If we were in this position I would be working every hour I could when my spouse were home.

Don't forget Mr Beatles won't delivery pizzas either because he can't get in and out of his car that much. Maybe he has a real disability but it sounds like an excuse to me (since he hasn't mentioned a real physical disability).

Actually I did.

You just don't want to bother to read it.

the only thing you said about delivering pizzas is that you can't get in and out of your car that much.
Please point me to the post where you described the physical disability (I may have missed it, there are a lot of posts) and you will get a real apology.

Bad back.

Probably on page 20-21ish.

[The beatles]

beatles if you can say with a straight face, in big bold print, in all caps, that "NO ONE IS CHEATING THE IRS OF ANYTHING", then I really do think you are deluding yourself.

YOU are cheating the IRS right now. You owe thousands of dollars in unpaid taxes. That's what they are. It's not a "scam". You didn't pay. That's cheating. Wake up.

Being delinquent is not the same thing as cheating.

[The beatles]

6.) Mrs. Beatles could work nights and weekends but isn't.  If we were in this position I would be working every hour I could when my spouse were home.

Don't forget Mr Beatles won't delivery pizzas either because he can't get in and out of his car that much. Maybe he has a real disability but it sounds like an excuse to me (since he hasn't mentioned a real physical disability).

Actually I did.

You just don't want to bother to read it.

the only thing you said about delivering pizzas is that you can't get in and out of your car that much.
Please point me to the post where you described the physical disability (I may have missed it, there are a lot of posts) and you will get a real apology.

A reason why the wife can't deliver pizza wouldn't hurt either.

Or, you know, taking the pizza delivery for what it is - the suggestion that someone get a reliable, wage-earning side gig to help get you out of your quandary. It doesn't literally have to be pizzas.

She's too tired after a full day with the kids.

[Zoot]

Bad back.

Probably on page 20-21ish.

The exact wording was:  "Because of my back, I physically can't get in and out of a car that many times a night (to deliver pizza's)." 

[Tyson]

Beatles, why is it not an option to sell the big house and have the in-laws rent elsewhere?  Selling both of your rental properties gets you out from under all of this. 

[swick]

Mod Note: With the amount of information provided, it is irresponsible for forum members to continue giving advice at this time.  After much deliberation, we have decided to close the thread. There are too many unknowns and too many assumptions being made.

There are 20+ pages of actionable suggestions that the Beatle family can start to implement. Hoping they take this experience and use it to provide a solid foundation for their family.

[theotherbeatle]

MOD NOTE: This post, and every reply below it, was in a new thread. I merged them together after locking this one, as well, so it's all together.

For those who don't know what I'm talking about, the original case study is here. I would reply in the thread itself but it's been locked and my husband isn't allowed to post for 90 days. I really don't want to be posting and I begged the moderators to let him post but it seems like I'd have a better chance curing world hunger than getting them to change their mind. So here I am. Be gentle please.

We have been working really hard the last few weeks to turn things around and have run into a few snags.

The biggest one is that we are trying to sell our rental but the realtor came back to us with news that dampens that.

Our rental has a bad roof.

The consensus on here was to offer a concession at closing for the cost of the roof.

Our realtor says that every lender she knows of will require the roof be replaced prior to funding. As in they literally won't approve the funding with the roof the way it is.

She said if it's a cash buyer, then yeah we could do it but a cash buyer is not likely in this area.

Thoughts?

[honeybbq]

How do you know a cash buyer isn't likely in the area?

If it's priced right, they'll come out of the woodwork.

[researcher1]

We have been working really hard the last few weeks to turn things around and have run into a few snags.
Our rental has a bad roof.  The consensus on here was to offer a concession at closing for the cost of the roof.
Our realtor says that every lender she knows of will require the roof be replaced prior to funding. As in they literally won't approve the funding with the roof the way it is.
She said if it's a cash buyer, then yeah we could do it but a cash buyer is not likely in this area.

You/your husband posted this same issue in the locked thread and you received a mountain of advice.
Yet fast forward several weeks, and you still haven't acted on the advice, and are just asking the exact same question over again!

List the damn rental property TODAY!  Stop pussy-footing around!  You keep going around in circles without taking any action!
- The buyer's lender might not consider the roof to be "bad."
- The buyer could qualify for a FHA 203(k) mortgage or Fannie Mae HomeStyle Renovation mortgage
- A cash buyer may make an offer.
- You and the buyer can work out an agreement on the roof, once you've received a formal offer & earnest money.

In your position, there is virtually no downside to listing TODAY. 
Remember, you have no insurance on this property and you owe thousands in back taxes.

[theotherbeatle]

You/your husband posted this same issue in the locked thread and you received a mountain of advice.
Yet fast forward several weeks, and you still haven't acted on the advice, and are just asking the exact same question over again!

Please don't be rude. We have acted. The tenants were told of our plans to sell and we are in talks with the realtor on how to move forward.

I started this topic because the advice we were given on here, the realtor is saying is false. We are looking for further advice.

- The buyer's lender might not consider the roof to be "bad."

Honey, the shingles are gone and all you see is plywood in several parts of the roof. The reason we don't have insurance is because the insurance company dropped us because the roof was so bad. I don't think there is any degree worse than this.

- A cash buyer may make an offer.
- You and the buyer can work out an agreement on the roof, once you've received a formal offer & earnest money.

My husband and I suggested this to the realtor and her response was that we run a risk in doing that. If the house doesn't sell, we then will have to put on the roof and buyers will be put off wondering if the roof caused rot damage below the new shingles.

Do you think this is true?

Remember, you have no insurance on this property and you owe thousands in back taxes.

You're right that we have no insurance. We are now on our property tax payment plan for the back taxes.

[theotherbeatle]

How do you know a cash buyer isn't likely in the area?

If it's priced right, they'll come out of the woodwork.

The truth is I don't know. That's simply what the realtor told us.

[swick]

Have you spoken to more than one realtor? She may be giving you advice that works out best for her self-interest.

It is common (In Canada, not sure about the US) to have an offer contingent on a home inspection. The home inspection will show the roof (and any underlying damage) and will not be a surprise to the purchaser and they will probably come back with a counter-offer depending on what they want to do with it.

Have you spoken with your tenants to gauge their interest in purchasing the property? Even if you give them a better deal, you would save on realtor fees, they know what they are getting into and it could be off your shoulders  - and therefore less of a liability as it is not insured, quicker.

[researcher1]

For those who don't know what I'm talking about, the original case study is here. I would reply in the thread itself but it's been locked and my husband isn't allowed to post for 90 days.

It is not my intention to be mean, but I want to offer some frank thoughts about your husband.
For lack of a better explanation, it seems like he is slipping deep 'down the rabbit hole' in his attempt to deal with this financial disaster. 

I came across his "blog" and reviewed his most recent post.  Have you read it? 
Either he is not taking this situation seriously, or is psychologically paralyzed take quick/meaningful/efficient actions.
He is not focusing on practical/actionable research that can have an immediate positive impact on his dire situation.

Instead, he's written a nearly 5,000 word dissertation on "The complete world history of frugal living."  Here's an excerpt...
"My research began with determining whether frugality is a modern construct, or if it can be retraced to times long gone. It was quite a fascinating journey...
I studied the course of frugality throughout each era in order to understand how it became popular, to provide the reason behind their becoming frugal, and to unearth examples of famous people that we can model ourselves after today."

WTF?!?!  Why is he spending his available time/energy on this?  Why isn't he reading about Do-It-Yourself Roofing or Cheap Family Meals?

[swick]

MOD NOTE: Let's keep suggestions action oriented and things that theotherbeatles  can do herself, independently of what her husband is doing with his time.

[theotherbeatle]

Have you spoken to more than one realtor? She may be giving you advice that works out best for her self-interest.

We've only talked to the one realtor, she is the one who sold us our current house. I was kinda wondering myself whether she is giving us advice in her best interest but I simply dont have enough knowledge about this situation to judge whether she is being honest or not.

It is common (In Canada, not sure about the US) to have an offer contingent on a home inspection. The home inspection will show the roof (and any underlying damage) and will not be a surprise to the purchaser and they will probably come back with a counter-offer depending on what they want to do with it.

That's what I thought to!
But the realtor is saying that its not about the buyer, its about the lender. The lender wont allow the bad roof?

Have you spoken with your tenants to gauge their interest in purchasing the property? Even if you give them a better deal, you would save on realtor fees, they know what they are getting into and it could be off your shoulders  - and therefore less of a liability as it is not insured, quicker.

Yeah definitely. The family would like to but they can't afford the downpayment.

[Mazzinator]

I didn't read the other thread, but if the roof is THAT bad, then it needs replaced, regardless. Safetly for the tenants??? And to gain insurance.

Replace the roof, then sell...or keep it, if it's profitable??? No way i can read the entire other thread.

[theotherbeatle]

For those who don't know what I'm talking about, the original case study is here. I would reply in the thread itself but it's been locked and my husband isn't allowed to post for 90 days.

It is not my intention to be mean, but I want to offer some frank thoughts about your husband.
For lack of a better explanation, it seems like he is slipping deep 'down the rabbit hole' in his attempt to deal with this financial disaster. 

I came across his "blog" and reviewed his most recent post.  Have you read it? 
Either he is not taking this situation seriously, or is psychologically paralyzed take quick/meaningful/efficient actions.
He is not focusing on practical/actionable research that can have an immediate positive impact on his dire situation.

Instead, he's written a nearly 5,000 word dissertation on "The complete world history of frugal living."  Here's an excerpt...
"My research began with determining whether frugality is a modern construct, or if it can be retraced to times long gone. It was quite a fascinating journey...
I studied the course of frugality throughout each era in order to understand how it became popular, to provide the reason behind their becoming frugal, and to unearth examples of famous people that we can model ourselves after today."

WTF?!?!  Why is he spending his available time/energy on this?  Why isn't he reading about Do-It-Yourself Roofing or Cheap Family Meals?

I know he has a bunch of blogs, I didnt know it was 5,000 words but yes thats the way he is "wired" (using his words). He has been that way since i've met him. There are journals and writings all over his desk, he can write for hours. When we have disagreements instead of talking about it, he'll write about it and then hand me the notebook with a bunch of pages of his thoughts.

I dont imagine i'm going to change that about him, but lets please stay on topic about the roof. I have limited time while my kids take a nap to be on here.

[ShoulderThingThatGoesUp]

Buyers have many options for financing houses that need work. They won't be able to get a standard or FHA mortgage but at the right price that won't matter. I think you need a different realtor. Consider looking for listings that say "cash only" and seeing which local realtors pop up often.

[charis]

Buyers have many options for financing houses that need work. They won't be able to get a standard or FHA mortgage but at the right price that won't matter. I think you need a different realtor. Consider looking for listings that say "cash only" and seeing which local realtors pop up often.

+1 Get another realtor asap.

[swick]

Realtors work on commission, so it is in their best interest to sell properties as fast as they can and at the highest price. You definitely need a second opinion.

It is quite common for a lender to send out an appraiser if they are not sure on the valuation of the property. They don't really care the state that it is in, as long as it is worth at least as much as the mortgage they are backing.

Tring to find a cash deal would be in your best interest. They do exist, it might take a little more leg work to find a realtor who deals with them, but your house (given the background provided about how much interior work was done) would be IDEAL for someone looking to flip the house. The room won't phase them one bit.

[researcher1]

We have acted. The tenants were told of our plans to sell and we are in talks with the realtor on how to move forward.
I started this topic because the advice we were given on here, the realtor is saying is false. We are looking for further advice

You are making this more complicated than it needs to be.  Interview 3 realtors, decide on one, and list the property the next day.  Done. 

Sounds like you've only spoken with one realtor, and that realtor wants the house impeccably maintained to minimize the time/effort she may need to put forth to sell.  Find another realtor.  Do you think you have the only house for sale that requires work?  Thousands of houses are sold everyday that need new roofs, foundations, electric, plumbing, ect.

Honey, the shingles are gone and all you see is plywood in several parts of the roof. The reason we don't have insurance is because the insurance company dropped us because the roof was so bad. I don't think there is any degree worse than this.

I believe this property has asphalt shingles.  Why not buy 1-2 bundles of shingles and replace the missing sections yourself?  It's not difficult.  This would allow you to get insurance on the house AND be able to sell it without worrying about the buyers financing.

My husband and I suggested this to the realtor and her response was that we run a risk in doing that. If the house doesn't sell, we then will have to put on the roof and buyers will be put off wondering if the roof caused rot damage below the new shingles.  Do you think this is true?

Get a new realtor!  This one just keeps coming up with excuses.  You cannot control what buyers may wonder about.  Your disclosure sheet, and their inspection, should provide them with the information they need.

You're right that we have no insurance. We are now on our property tax payment plan for the back taxes.

Is there also a plan in place to pay for the $4,000+ in taxes that are due next month?

[former player]

Yes, look up the listings in your area for houses already for sale at the price point of your rental.  Write down the names and telephone numbers of the realtors who are selling them, and start calling.  Outline the problem, ask them for their advice, and give the listing to the one whom seems most on the ball with suggestions.  You should be able to have a tentative arrangement with someone by the end of today.

Good luck.

[Dave1442397]

I live in an older development (1960), and have seen plenty of houses sold in pretty terrible condition.

Some have been foreclosures, but others were just estate sales or sales from people who got too old and infirm to maintain the property.

I've seen quite a few houses that sold and were immediately renovated, with a new roof being the first thing they did.

Do they sell for less than market value? Yes, but they still sell, and most of them sold pretty quickly.

[MayDay]

Oh good lord. 

Call 3 realtors right now and ask them how they would handle this.  Pick one and list the house today. 

[theotherbeatle]

Sent messages to 2 other realtors. Waiting for their response.

[sailinlight]

Also, don't let realtors boss you around.  They work for you.. their job is to find clients who want to buy the place.  You got enough advice here for what you're looking for.  I would call up any realtors that don't look super busy or high-end, and keep the conversation short.  "I have a house which isn't in the best condition that I need to sell fast.  It would likely be a cash offer.  What kind of commission would you charge in this situation?"  I can't remember from the original thread what you think the house is worth, but if it's more then $150k or so, you should be able to find someone willing to sell it for much less than 3%.  You should get a feel if they deal with this kind of situation a lot, some realtors specialize in it and already have a list of buyers lined up and it will take no work on their part.

[swick]

Sent messages to 2 other realtors. Waiting for their response.

Good job! Once the ball gets rolling and you get used to doing these things, it will get easier and you will feel more powerful and in control.

[theotherbeatle]

2nd realtor texted back. Said that we would have to list it as "cash only". It will take a large percentage of buyers out of the equation but it can be done.

Waiting for the 3rd realtor.

[swick]

2nd realtor texted back. Said that we would have to list it as "cash only". It will take a large percentage of buyers out of the equation but it can be done.

Waiting for the 3rd realtor.

It is a good thing to take a large % of the buyers out of the equation. It saves you time dealing with offers that will fall through, those who can't get the right financing etc. You don't need many buyers, you need the right buyer. This is a good way to find them.

[charis]

I imagine most realtors would like to avoid taking a large percentage of buyers out of the equation.  But that's not really your concern right now.  Someone will get it done.

[theotherbeatle]

3rd realtor responded. Said the same thing as the first two. Cash only unless the buyer is willing to pay for the roof prior to closing.

[charis]

Ok - so list it as cash only.  You can't afford to have the roof fixed and seem unwilling to fix it yourselves, so what other choice do you have?

[sailinlight]

You want a cash buyer!  They close fast (you can have the money in your bank in 7-10 days) and don't have a ton of contingencies that might make the deal fall through.  Find a realtor that specializes in this.. there are people waiting for these deals

[theotherbeatle]

You want a cash buyer!  They close fast (you can have the money in your bank in 7-10 days) and don't have a ton of contingencies that might make the deal fall through.  Find a realtor that specializes in this.. there are people waiting for these deals

Correct.

And all 3 realtors warned that cash buyers typically pay less than financed buyers. So we will likely walk away with less money.

[sailinlight]

You want a cash buyer!  They close fast (you can have the money in your bank in 7-10 days) and don't have a ton of contingencies that might make the deal fall through.  Find a realtor that specializes in this.. there are people waiting for these deals

Correct.

And all 3 realtors warned that cash buyers typically pay less than financed buyers. So we will likely walk away with less money.

But every day you don't sell the house, you're paying outrageous interest rates on your debt and would have to finance a new roof to get the full-priced offer anyway.

[redbird]

You want a cash buyer!  They close fast (you can have the money in your bank in 7-10 days) and don't have a ton of contingencies that might make the deal fall through.  Find a realtor that specializes in this.. there are people waiting for these deals

Correct.

And all 3 realtors warned that cash buyers typically pay less than financed buyers. So we will likely walk away with less money.

It would probably be worth taking that "loss" of less money for it though. It sounds like you can't afford to fix the roof yourselves right now, and selling it would get rid of all of the other expenses and liabilities related to it too.

I say go for it - try to find a cash buyer.

Good luck!

[scantee]

You want a cash buyer!  They close fast (you can have the money in your bank in 7-10 days) and don't have a ton of contingencies that might make the deal fall through.  Find a realtor that specializes in this.. there are people waiting for these deals

Correct.

And all 3 realtors warned that cash buyers typically pay less than financed buyers. So we will likely walk away with less money.

You're not in a situation that allows you the luxury of waiting to maximize the return on your investment. Your situation is such is that you need to stop hemorrhaging money, immediately, or you'll go bankrupt. Sell as quickly as possible and don't dwell on an alternate version of reality where you sell and make a ton of money.

[charis]

You want a cash buyer!  They close fast (you can have the money in your bank in 7-10 days) and don't have a ton of contingencies that might make the deal fall through.  Find a realtor that specializes in this.. there are people waiting for these deals

Correct.

And all 3 realtors warned that cash buyers typically pay less than financed buyers. So we will likely walk away with less money.

It would probably be worth taking that "loss" of less money for it though. It sounds like you can't afford to fix the roof yourselves right now, and selling it would get rid of all of the other expenses and liabilities related to it too.

I say go for it - try to find a cash buyer.

Good luck!

Also, the risk of not having it insured is MUCH worse than walking away with less cash.   

[theotherbeatle]

You want a cash buyer!  They close fast (you can have the money in your bank in 7-10 days) and don't have a ton of contingencies that might make the deal fall through.  Find a realtor that specializes in this.. there are people waiting for these deals

Correct.

And all 3 realtors warned that cash buyers typically pay less than financed buyers. So we will likely walk away with less money.

You're not in a situation that allows you the luxury of waiting to maximize the return on your investment. Your situation is such is that you need to stop hemorrhaging money, immediately, or you'll go bankrupt. Sell as quickly as possible and don't dwell on an alternate version of reality where you sell and make a ton of money.

I understand.

[redbird]

You want a cash buyer!  They close fast (you can have the money in your bank in 7-10 days) and don't have a ton of contingencies that might make the deal fall through.  Find a realtor that specializes in this.. there are people waiting for these deals

Correct.

And all 3 realtors warned that cash buyers typically pay less than financed buyers. So we will likely walk away with less money.

It would probably be worth taking that "loss" of less money for it though. It sounds like you can't afford to fix the roof yourselves right now, and selling it would get rid of all of the other expenses and liabilities related to it too.

I say go for it - try to find a cash buyer.

Good luck!

Also, the risk of not having it insured is MUCH worse than walking away with less cash.

Exactly. That was one of the things I was thinking about when I said liabilities. There's also the fact that they have a severely damaged roof. With a roof that bad, the elements/animals/pests could easily cause even more damage. The longer this building goes with a poor roof, the less valuable it's going to become. Beatles Family should cash out on it while they can while it's still worth something.

[BabyShark]

I just want to say that I'm really impressed you're here and looking for feedback and taking action.  I followed along with the other thread and it would be overwhelming to say the least.  I can't offer constructive feedback other than that right now, but good work.

[ysette9]

I, too, would like to add in my support for you, Mrs Beatles. Good job coming back, good job asking questions. We really want you to succeed. Choose a realtor and get that sucker on the market right away. Good luck!

[honeybbq]

2nd realtor texted back. Said that we would have to list it as "cash only". It will take a large percentage of buyers out of the equation but it can be done.

How many buyers do you have right now?

[honeybbq]

You want a cash buyer!  They close fast (you can have the money in your bank in 7-10 days) and don't have a ton of contingencies that might make the deal fall through.  Find a realtor that specializes in this.. there are people waiting for these deals

Correct.

And all 3 realtors warned that cash buyers typically pay less than financed buyers. So we will likely walk away with less money.

Here ya go:

Option 1: Fix roof. Make more money. Except a roof costs money, which you don't have... leading to:

Option 2: Don't fix roof, make less money.

Which one is realistic?

[PJ]

I just want to say that I'm really impressed you're here and looking for feedback and taking action.  I followed along with the other thread and it would be overwhelming to say the least.  I can't offer constructive feedback other than that right now, but good work.

I, too, would like to add in my support for you, Mrs Beatles. Good job coming back, good job asking questions. We really want you to succeed. Choose a realtor and get that sucker on the market right away. Good luck!

+1 and +1

I read through all of the other thread in a couple of long sittings, and it was overwhelming even for me!  And I know it upset both you and your husband at times.  Yet you seem to have been able to get past that, and see past that to the fact that there's good advice here, and now we see you taking the reins and trying to move forward on what's been suggested.

[theotherbeatle]

I just want to say that I'm really impressed you're here and looking for feedback and taking action.  I followed along with the other thread and it would be overwhelming to say the least.  I can't offer constructive feedback other than that right now, but good work.

I, too, would like to add in my support for you, Mrs Beatles. Good job coming back, good job asking questions. We really want you to succeed. Choose a realtor and get that sucker on the market right away. Good luck!

+1 and +1

I read through all of the other thread in a couple of long sittings, and it was overwhelming even for me!  And I know it upset both you and your husband at times.  Yet you seem to have been able to get past that, and see past that to the fact that there's good advice here, and now we see you taking the reins and trying to move forward on what's been suggested.

Thank you for the kindness, both you and everyone else who has said nice things in this thread.

Honestly it took a lot of gusto for me to log into here today. I contemplated it for a while. I am a little bitter that the admins thought it was prudent to ban my husband. He said some not nice things but he was exhausted and overwhelmed and they took that time to stop him from coming back here, right in the middle of a time that we need this forums help and advice the most. I simply dont have the time to be on here that he does. It is what it is.

Thanks for the help everyone.

[theotherbeatle]

If anyone has advice on how to tell the tenant that we will be bringing a realtor over without freaking them out and making them look at other houses to move to, i would appreciate it.

[Cranky]

Well, they're probably going to have to move when you sell it anyway, and if they haven't moved out of a house with a bad roof and no insurance, it's possible that they can't afford to move.

I'm with the chorus - you already have no money, so either you sell the house for whatever you can get for it, or you buy some shingles and you and your parents and Mr. Beetle and whatever friends you can muster climb up and nail some shingles on there, and then you sell it.