iammagi 0 Report post Posted March 30, 2003 I'm just starting to learn investing so maybe I'm a bit skeptical of the websites, courses, and gurus who show everything as easy and rosy. They never mention all the things that can go wrong. How do you calculate the costs of major problems, and what can be done to insure that I'm protected. For example, what if a major appliance like the A/C or boiler goes bad? Is insurance recommended for that? Where will the money come from? These guru's only show the successes and don't factor in potential calamities. What are potential problems, i.e. trashed by tenants, appliances gone bad, lawsuits etc.? What can go wrong and REALISTICALLY how much of a buffer should I allow myself for potential problems. Share this post Link to post Share on other sites
-Tony- 0 Report post Posted March 30, 2003 iammagi, in your contract you should have that the owner/seller will pay for repairs over $200-500 (the lowest you can negotiate) in your contract to the tenant/buyer you can stipulate that they will cover what ever you negotiated. take a look at this post it may answer some questions. Tony Share this post Link to post Share on other sites
MichaelC 160 Report post Posted March 31, 2003 Hello, Iammagi, and welcome to The Naked Investor.I'm just starting to learn investing so maybe I'm a bit skeptical of the websites, courses, and gurus who show everything as easy and rosy.They never mention all the things that can go wrong.Good for you. For both starting and for being skeptical. A bit of skepticism is a good thing.Tony referred you to a recent thread which touched on this very matter. Have a good read of it and tell us if it helps clarify this for you. With a correctly set up lease purchase, you should be in a well protected position with your responsibilities and liabilites at a minimum.What are potential problems, i.e. trashed by tenants, appliances gone bad, lawsuits etc.? What can go wrong and REALISTICALLY how much of a buffer should I allow myself for potential problems.Having said what I just did, the reality is something can always go wrong. Someone can always decide to sue you. I'd be lying if I were to tell you that this is a 100% risk free proposition. It isn't, iammagi. But, then, no real estate transaction is.We can do many things to minimize our risks and exposure, but they cannot be eliminated completely. That shouldn't frighten you, though. The rewards are well worth it. Share this post Link to post Share on other sites
