AASEW Meeting: Financing Real Estate In Today’s Market —- May 20, 2013

May 6

Posted by Tristan R. Pettit, Esq. in AASEW, Investing In Rental Property | No Comments

Please join me at the AASEW‘s next monthly membership meeting where we will discuss Financing Real Estate in Today’s Market.

When: Monday May 20th, 2013 at 7:00 p.m.

Where: The Best Western, 1005 S. Moorland Road, Brookfield 53005

Who: Panel of local lending experts. Details below.

Cost: This meeting is free for current AASEW members, $25 for guests or expired members

Good deals are more abundant today than ever in the past.  But we all know low prices at the same time as low interest will not last forever.  The deal killer for most is funding those great projects you find.  Come to this meeting and get a pulse on the current lending environment from big bank lending to smaller community banks. From hard money lending to the credit union perspective, our panel discussion is sure to have something for you! And speaking of perspective, some of our experts are landlords too!

Knowledge is power! The AASEW is proud to present yet another forum on information you need to succeed in today’s economy.

Monday, May 20th at 7 PM is just Around the corner! See you then!”

 

Our panelists will include:

Rob Seetan – Brewery Credit Union

Rob has lived and worked in Milwaukee for 15 years.  His first job in the mortgage industry with Pinnacle Bancorp (no longer exists) as an Account Executive.  He started loan originating in Milwaukee 2000.  He joined Brewery Credit Union in 2009 and holds the position of originator, underwriter and administrator for Brewery Credit Union founded as Brewery Workers Credit Union in 1934.  Brewery CU maintains about 15% of its portfolio with small investment properties (no commercial lending).  The majority of their investment units are within the City of Milwaukee.  Brewery Credit Union was granted special privileges by US Treasury Dept. through our Community Development Financial Institution (CDFI) designation.
Luke Hagel – Commerce State Bank

Luke has been working in the banking industry for about 9.5 years.  He began my career with Wisconsin Business Development as a credit analyst in 2003.  While at the WBD he learned a lot about SBA lending, specifically relating to the SBA 504 and 7a programs.  Hejoined Commerce State Bank in January of 2008 and has worked as part of the commercial lending team there since that time.  Luke grew his own portfolio which is currently about $50MM in loans comprised mostly of C&I loans (Real estate, LOC’s, equipment, etc.).  Luke assists in nearly all SBA lending done at the bank.  Luke graduated magna cum laude from Ripon College with a B.A. in Business Management in 2003 where he also served as a Student Mentor, Resident Assistant (R.A.) and member of both the college Baseball and Football teams.  Luke also graduated magna cum laude from UW-Milwaukee with a Masters of Business Admin in 2006.  He currently resides in West Bend with his wife and 3 kids.

Chris Wilz – Senior Lender US Bank

Chris is Vice President & Relationship Manager for US Bank, Business Banking division.  He has over 11 years of experience with commercial lending and in the financial services industry.  He earned his bachelor’s degree from the University of Wisconsin – Madison Business School majoring in Finance, Investments & Banking.  Chris works with commercial real estate investors and business owners to provide financing for real estate loans, equipment loans or leases, and lines of credit, in addition to the full breath of banking products and services the bank has to offer.  For three consecutive years, Chris has received an Annual Pinnacle award for being one of the top producers at US Bank.
Scott Lurie – F Street Investments, Jomela Properties

Scott, a local Milwaukee businessman earned his B.A. in Finance from The George Washington University.  After college, Scott spent 2 years in the M&A industry serving as an analyst for Kaulkin Ginsberg Company.  After moving back to the Midwest, Scott worked for his family heading a division of Lurie Glass.  In August of 2004, Scott let his entrepreneurial spirit get the better of him and began investing in real estate.  After purchasing a Homevestors of America franchise, Scott got involved in real estate acquisitions, financing, and property management.  His relationship with Homevestors ended in February 2009.  Scott continues to be involved in real estate and finance.  To date, Scott has bought and sold over 125 houses in addition to building a rental portfolio of 1400 units which are self managed.  In addition to the multiple real estate acquisitions Scott has been involved in, he also specializes in “hard money” financing.  With over $12 Millions in deals financed to date Scott gets it done!  Scott’s interest outside of the office are his family, golf, tennis, and travel.

 

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HUD Issues Notice on Assistance Animals and Reasonable Accomodations For Persons with Disabilities

Apr 30

Posted by Tristan R. Pettit, Esq. in Assistance Animals, Companion/Comfort Animals, Reasonable Accomodations | 2 Comments

Today the U.S. Department of Housing and Urban Development (HUD) issued a notice on assistance animals and reasonable accomodations for persons with disabilities.

Not to long ago I wrote a post that dealt with this subject.  HUD’s new notice also adds clarifying information to that post.

Disability-related complaints, including those that involve assistance animals, are the most common discrimination complaint that HUD receives per John Trasvina, HUD Assistant Secretary for Fair Housing and  and Equal Opportunity, so HUD felt a need to publish this Notice to provide further guidance on the topic.

The notice will provides landlords and management companies with an explanation how to properly treat a request by a tenant or their guest for a reasonable accomodation to the landlord’s “no pet” policy.  Below are some highlights from the Notice but I strongly encourage everyone to read the entire Notice.

Highlights:

1.  While the definition of a “service animal” under the ADA has been limited to include only dogs that have been specifically trained (and it specifically excludes emotional support animal) this limited ADA definition DOES NOT limit a landlord’s obligations to make reasonable accomodations for assistance animals under the Fair Housing Act and Section 504 of the Rehabilitation Act ot 1973, (or Wisconsin’s Open Housing Law for that matter)/

2.  A reasonable accomodation analysis must be considered when persons with disabilities use (or seek to use) assistance animals in housing where the landlord forbids residents from having pets or otherwise imposes restrictions or conditions relating to the pet.

3.  Assistance animals provide many disability-related functions including, but not limited to:

a.  guiding individuals who are blind or sight-impaired

b.  alerting individuals who are deaf or hard of hearing

c.  providing protection or rescue assistantance

d.  pulling a wheelchair

e.  fetching items

f.  alerting persons to impending seizures

g.  providing emotional support to persons with disabilities who have a disability-related need for such support.

4.   For purposes of a reasonable accomodations request, there is no requirement that the animal be individually trained or certified.

5.  Landlords are to evaluate a requests for a reasonable accomodation to posses an assistance animal in a rental unit using the general principles applicable to all reasonable accomodations requests.

6.  After receiving such a request a landlord must consider the following:

a.  Does the person have a disability?

b.  Does the person have a disability-related need for an assistance animal?

If the answer to both questions is “yes” then the federal laws (and Wisconsin’s Open Housing laws) requires a landlord to modify or provide an exception to its “no pets” rule or policy so that the tenant can have an assistance animal.

7.   The request for an assistance animal can be denied, even if the answers to the above questions were “yes”, if:

a.  the specific assistance animal poses a direct threat to the health and safety of others that cannot be reduced or eliminated by another reasonable accomodation.

b.  the specific assistance animal would cause substantial physical damage to the porperty of others that cannot be reduced or eliminated by another reasonable accomodation.

8.  Breed, size, and weight limitations may not be applied to an assistance animal.

9.  Landlords may not require applicants and residents to pay a deposit for an assistance animal.

10.  Landlords may require a tenant to cover the cost of repairs for damage caused by an assistance animal to the rental unit or common areas after it has occurred.

11.  Landlords may ask individuals with disabilities who’s disability is not readily apparent or known to the landlord, to submit reliable documentation of a disability and their disability-related need for an assistance animal.  The documentation is considered sufficient if it establishes the person has a disability and that the animal will provide some type of disability-related assistance or emotional support.

12.  A determination as to whether a person has a disability-related need for an assistance animal involves an individualized assessment.  There are no birhgt line rules here.  The analysis is very fact specific.

13.  A delayed response to a request for a reasonable accomodation could be considered a violation if the delay is solely to frustrate the process.

 

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Top 10 Pitfalls That Landlords Should Avoid

Apr 25

Posted by Tristan R. Pettit, Esq. in AASEW, CCAP, Notices, Property Management, Rejecting Rental Applicants, Rental Agreements, Rental Documents, Screening Tenants, Seminars | No Comments

Those of you that missed the last AASEW membership meeting on Monday, April 15, 2013, missed a great meeting and a great presentation.  The featured presenter was John “Dr. Rent” Fischer, a Wausau-area landlord and rental property manager, who spoke to a packed house that Monday.  John’s presentation was dynamic, educational and at times pretty darn funny.

With John’s permission, I am providing you with a link to John’s handout from the meeting which was entitled “Top Ten Pitfalls That Landlords Should Avoid.”

Like any good Top 10 list (a la David Letterman), John presented these pitfalls in reverse oreder based on importance.  The pitfalls to avoid included:

10.  Mailing the 5 Day Notice

9.  Digging The Hole Too Deep

8.  Incomplete Applications

7.  Not Asking The Right People (about your rental applicant)

6.  Auto-Renewing A Lease

5.  14 Day Notice (or NOT)

4.  “Do-It-Yourself” Leases or Rental Forms

3.  Misuse of CCAP

2.  Carpet Cleaning

1.  That Lease is HOW LONG?

As John stated during his presentation, there are a lot of things that are beyond our control that make life as a landlord very difficult at times.  As such, we certainly do not want to make life more difficult for ourselves based on a lack of knowledge of landlord-tenant laws . . . unless we are masochists, that is.

The AASEW has another great meeting scheduled for May 20, 2013 at 7 pm at the Best Western Midway in Brookfield about “How To Finance Real Estate Transactions In The Current Economy.”

 

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Another Way That Landlords Can Teach Tenant Roommates the Concept of Joint & Several Liability (and Collect Rent)

Apr 8

Posted by Tristan R. Pettit, Esq. in Joint & Several Liability, Roommates | No Comments

I recently received an email from the Gino Zahnd the CEO of a company called Cozy based in the San Franciso area.  Gino’s company assists landlords in collecting rent and referenced my blog post discussing the concept of “joint and several liability” in which I explain how landlords should treat roommates as “one person” in order to impress upon tenants the concept of joint and several liability.  Joint and Several liability is a landlord’s best friend and makes life much easier for us.  If you are not already treating your tenant roommates as one person then I suggest you start doing so in the near future.

It appears as if Cozy offers a rent payment product to landlords that may assist in the rent collection process especially with roommates.   Gino’s blog posts mentions some of the practical issues of getting one rent check from several roommates and their product attempts to assist with that.  While I have not tried Cozy’s product it sounds intersting.  If any of my followeres uses it or tries it out in the future please let me know what you think.

Here is the post from Gino that references my blog.

T

 

https://cozy.co/blog/doing-payments-the-right-way/

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Next AASEW Meeting: Dr. Rent’s Top Ten Landlording Pitfalls To Avoid – April 15th

Apr 2

Posted by Tristan R. Pettit, Esq. in AASEW, Evictions, Miscellaneous, Property Management, Seminars | 4 Comments

The AASEW’s next meeting will feature Dr. Rent’s TOP TEN Landlording Pitfalls to Avoid

When: Monday April 15th, 2013 at 7:00 p.m.

Where: The Best Western, 1005 S. Moorland Road, Brookfield 53005

Who: John “Dr. Rent” Fisher

Cost: This meeting is free for current AASEW members, $25 for guests or expired members

Bad things happen to good people.  When a good landlord falls victim to a bad tenant, we all know the results. Dealing with bad tenants is already hard enough, but too often good landlords fall victim to their own mistakes as well.  Dr. Rent will discuss the 10 most common mistakes that he has seen in over two decades as a landlord in Wisconsin. One of the best things that we can all do is learn from our mistakes, but Dr. Rent has found it wiser to learn from others.

About our speaker: John H. Fischer is a Wausau, Wisconsin area landlord.  He started working part-time with Emmerich & Associates, Inc. in 1993 and since then has worked in nearly every aspect of the real estate investment field.  He has been involved with residential, commercial and industrial rental properties as well as vacant land sales and condominium development.

Observing a number of old and new landlords going to court and having a hard time because of their not understanding Wisconsin’s complicated laws and procedures, Mr. Fischer has been making an effort to educate Landlords on the proper way to do things for over a decade, and has taught classes on everything from accounting, to proper management procedures to Landlord-Tenant law. He has provided training sessions through Lorman and Sterling educational services.  He has also presented seminars to a number of local apartment associations as well as the Wisconsin Apartment Association.  He offers a series of courses in real estate investing through the University of Wisconsin Continuing Education program.

Mr. Fischer holds a real estate Broker license and is past president of the Wausau Area Apartment Association and Wisconsin Apartment Association.  He is a member of Wausau’s Housing Code Task Force.  He has degrees in International Business Management (with Honors) as well as Human Resources Management (with Honors) from the University of Wisconsin – Madison School of Business. He is also a graduate of the Bryce Harlow Institute for Business and Government Affairs, Georgetown University, Washington, DC.

 

You will not want to miss this meeting!!

Hope to see everyone there.

T

 

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Next AASEW Meeting – The Ins & Outs of Evicting – March 18th

Mar 12

Posted by Tristan R. Pettit, Esq. in AASEW, Evictions | No Comments

The next AASEW meeting will focus on the “The Ins & Outs of Evicting.”

The meeting will be held on Monday, March 18th, 2013 at 7:00 p.m. at the Best Western Hotel located at 1005 S. Moorland Road in Brookfield.

The speakers will be Attorney Tristan Pettit of Petrie & Stocking S.C. and Detective Jon Nilsen of the Milwaukee County Eviction Squad.

Atty. Pettit will discuss the top reasons that the courts dismiss landlord’s evictions and Det. Nilson will speak to us about how the execution of a writ of restitution works and what the Sheriff’s Department does to remove tenants that refuse to leave our rental properties after being ordered by the court to vacate.  Det. Nilsen will also tell us what we can do as landlords to provide the Sheriff’s Department with the necessary and vital information that they need in order to safely complete the eviction process.

Attorney Tristan Pettit focuses his practice on representing landlords and property management companies throughout SE Wisconsin.  Atty. Pettit is the presenter of the AASEW’s popular Landlord Boot Camp and also drafts the landlord-tenant forms that are sold by Wisconsin Legal Blank and used throughout the state.  Tristan is in eviction court in Milwaukee County every week representing many members of the Association and other landlords and property managers.

Detective Nilsen has been with the Milwaukee County Sheriff’s Department for 29 years and a Detective since 1995.  He has served in various capacities within the Sheriff’s Department including being a member of SWAT team for 14 years, the mounted unit, working as a bailiff in the courts, and patrolling the freeways. Since 1995 Detective Nilsen has worked with the eviction squad.

This meeting is free for current AASEW members and $25 for everyone else.

Hope that you all can make it.

 

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GUEST POST: The Importance of Rentals In Milwaukee

Mar 11

Posted by Tristan R. Pettit, Esq. in City of Milwaukee, Foreclosures | 3 Comments

Below is a very thought provoking guest post from fellow blogger (and friend and fellow AASEW Board Member) Tim Ballering:

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The Journal is reporting:

Over the next three years, Barrett said raze orders in the city are expected to grow to 1,600 homes, with a cost of $24 million.  ”We have a very severe problem right now,” Barrett said.

No kidding we have a “severe problem ”  This a problem that continues to grow rather than moderating.  The number of abandoned and foreclosed houses was bad nine months ago and with fresh snow on the ground you can see even a greater number of unoccupied properties than ever before. At least here on the Southside of Milwaukee these numbers are far worse than what is being reported by the city.

How much of the $24 million of anticipated razing costs could be avoided by making it more favorable to rehab properties and restore them to the tax rolls?

Perhaps the city would do better by working with, instead of against people willing to invest their own money, time and effort into putting foreclosures back in service.  I’m not even suggesting a hand up, just not the current beat down attitude. Not only would there be less spent on bulldozing, but more of the tax base would remain plus the positive economic impact for the community due to spending by owners to maintain and operate this housing.

Between taxes and the sewer and water bills the city gets  at least $5-6 million per year from 1600 functional properties. In the three year period Barrett defines this is a potential of $18 million in city revenue if the buildings were returned to occupancy. Add this to the $24 million to bulldoze and you are north of 40 million dollars.

Can every property that is deemed to be worthy of razing able to be salvaged, of course not.  But many that are in the pipeline today can be.  Every day that a property sits unattended is a day closer to the wrecking ball being the only option for that property.  There are many properties sitting vacant today that are worthy of repair, but will not be so six months or a year from now.

Additionally every time someone like you or I take on the challenge of putting properties back in service the local economy sees a benefit through the wages and materials we pay to get the job done.  All but one of my employees live in the city.  While the money you spend at the Home Depot doesn’t stay in Milwaukee,  the person who is employed by the Home Depot lives in the area and spend their wages here.

A downside for us, but an upside for the community is a greater amount of housing stock available holds rents down.  A more competative market also forces owners to do more to properties to get and keep them rented.

Once the property is back in service ongoing maintenance similarly impacts the local economy in a positive manner. It is estimated that repairs and improvements to rental properties represent $90 -120 million a year in the city of Milwaukee alone.   (These numbers are derived from our company’s experiences, the experiences of other long term owners that I’ve discussed this with and data from the Census Bureau’s Property Owners and Managers Survey.  Our data and that of many other owners indicate a slightly higher number than the Census)

Our company has the capacity and had the will to do 10-12 such projects a year without any government monies.  Heck if the environment was more favorable I could see us doing two properties a month.  We have not made an offer in MIlwaukee since November due the unfavorable policies adopted by the city. See my prior post on buying foreclosures in Milwaukee.  I talk to a lot of other owners with similar capacities that say the same thing.

Milwaukee acts like they are the only girl at the dance – as though real estate investors need to accept their petty obstructions and poor treatment because they are the only game in town.  But there are many other places to invest that treat owners much better.  One of our members is doing a big rehab in Beloit.  When I asked his project manager how it was going with the city he said they were unbelievably nice and truly seem they want to see the project succeed.  We are actively looking at the South Florida market today.

A few notes:

These 1,600 properties must be city owned or near to being city owned.  If they were bank owned the city could and would force the banks to demo the properties on the bank’s dime.  A growing trend is banks that  simply walked away from the mortgage rather than be subjected to the bad side of city regulations and fees. In another instance I spoke to an owner who the bank sued- he thought he lost the properties to foreclosure only to find out later that it was a money judgment only suit.  This adds to the zombie housing effect.  And you though only borrowers walked away.  ;-)

Our police chief is in the news speaking about the link between foreclosed and abandoned housing and crime.  I am certain he is correct on this.  But the Milwaukee Police do not do what they should in cases of property vandalism. See my prior post on property vandalism and the lack of police response.  This vandalism accelerate the rate of properties that are no longer viable for rehab.

 

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