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Rental Income Property

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2:58 pm
September 6, 2012


DebtKiller

Member

posts 13

My soon-to-be-ex-wife and I have been trying to sell our home for the last nine months and we've had ZERO luck.  We had one ridiculous offer that isn't even worth writing about here.  If we continue to lower the asking price, we're going to end up bringing money to the table to get out, which both of us refuse to do.

 

So our new plan is to refinance our current mortgage which will lower our monthly payment by over $300, and then rent out the house.  Renting it will provide us with a passive income stream of $450 to $600 per month, which has to be split evenly between us. 

 

At this point, it seems like the only available option for us, and it seems like a no-brainer.  But I have some concerns and worries about being a landlord. 

You can read the full details on my blog, but I would really like some advice and/or suggestions.  Is this a good idea?  Why?  Why not? 

Thanks.

12:33 pm
September 7, 2012


TightFistedMiser

Member

posts 361

Owning a rental property with your ex-wife seems like courting disaster.  There will be lots of decisions to make. Are you going to be able to agree?  I wouldn't own a property with my ex, but maybe you guys could make it work.

2:23 pm
September 9, 2012


Michelle (Making Sense of Cents)

Member

posts 400

TightFistedMiser said:

Owning a rental property with your ex-wife seems like courting disaster.  There will be lots of decisions to make. Are you going to be able to agree?  I wouldn't own a property with my ex, but maybe you guys could make it work.

I agree. I'm not sure if it's the best idea. I feel like there will be arguing in the future and it might lead to a disaster. However, if you believe that you two will be fine, it sounds like an okay idea.

1:42 am
September 14, 2012


GoldBuyer

New Member

posts 1

Post edited 11:18 am – February 22, 2013 by LaTisha @YoungFinances


Before you buy a rental property, consider three things: the expected amount of rental income, the annual expenses you will incur, and the risks that may come along.The basis of calculating income from house property is the rental value. This is the inherent capacity of the property to earn income. Letting residential investment property is treated as running a business – even if you only let out one property. And if you let out more than one property in the UK, they'll all be treated as one single business.Smile

9:41 am
September 14, 2012


Gen Y Finance Journey

Member

posts 69

I agree with others. I think the most important factor here is your relationship with your soon-to-be-ex-wife. From what you posted on your blog, it sounds like you consider it a non-issue, since the only concerns you discuss are being a landlord, being able to rent out the house, and being able to get another mortgage to buy another house. I think these are all really important considerations, but first and foremost you need to decide if you'd even be able to maintain a business relationship with your ex-wife. If not, perhaps you could come to an arrangement where one of you takes full responsibility for the house in exchange for a larger share of the rental income. Or maybe it would be worth it to take the loss and sell the house if it means you can completely move on from your marriage.

 

If you do decide to keep the house and rent it out, I think the best thing you could do for yourself would be to find a new place to live that is very inexpensive – you know there's some risk that you might not be able to keep the house filled with renters, so mitigate that risk by curbing expenses in your future housing as much as possible.

11:26 am
September 15, 2012


Filamwords.com

Member

posts 9

I agree with the others as well. I think the key to renting your property out is your relationship with your wife, on how each of you would handle the decisions. This is really starting a new business with your soon-to-be-ex-life-partner as your new business partner. Even if your still in good terms, something can get sour when running a rental property business.

In my opinion, renting real estate properties is not as easy as some people thought. You're right about the headaches associated with the maintenance and repair calls and the vacancy possibilities on where to get money to fund the monthly payments.

website: Filamwords.com – frugal lifestyle and finances of a Fil-Am couple

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3:42 am
September 17, 2012


John @ DebtAdviceResource

Member

posts 104

Hi DebtKiller,

 

A good question and the primary thought is can you manage to work alongside your ex-wife? The other thought would be in regards to property maintenance. Is this likely to be a problem? 

Where I live property rentals are at an all time high because people can't get mortgages. If the property were to be empty could you both survive and pay the extra cost of your mortgage. 

 

Overall I think on paper it's a sensible move, and I wish you all the best! You can retain the property until the market revives again, or at least until mortgages are being made more readily available. 

John "The Bankruptcy Guy"

 

Visit my website: http://www.debtadviceresource.com

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7:24 am
October 2, 2012


CBC

Liverpool

Member

posts 62

Wow, I would never think about owning a house with an boyfriend never mind husband. I may not be worth the hassle it causes in my opinion. It could be good if you two could make it work though!

 

Best of luck!

CBC International are specialists in debt recovery, based in Liverpool who provide their services to businesses across the UK, Europe and Worldwide.

11:50 am
October 2, 2012


jaicatalano

New York

Member

posts 846

After 4 years my home is slowly building value again. Not much but there is life. My rate is 6.5% but the banks won't refi me. Being that my wife isn't on the deed we are in the process of putting her on to then refi under her great credit. We would be saving $600 a month. 

 

I say let bygones be bygones and get the money. 

1:54 pm
October 2, 2012


krantcents

Member

posts 909

As a former landlord, the key thing to do is screen the tenant to the hilt and then some.  Credit reports, unlawful detainer search and visit their current home is in order.  It is much harder to get rid of a tenant after they move in.  Make sure you get a security deposit and first and last month's rent up front.  All the time upfront is worth it to avoid a problem later.  A few months without rent could really cripple you. Good luck.

krantcents  – Making Sense of Money

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1:42 pm
October 3, 2012


onesmartdollar

Member

posts 8

You are in a tough situation because you can't sell.  In a perfect world you wouldn't want to be in business with an ex, but right now the extra income would just be nice.  I say go for it and get out ASAP.Smile

1:44 pm
October 3, 2012


onesmartdollar

Member

posts 8

jaicatalano said:

After 4 years my home is slowly building value again. Not much but there is life. My rate is 6.5% but the banks won't refi me. Being that my wife isn't on the deed we are in the process of putting her on to then refi under her great credit. We would be saving $600 a month. 

 

I say let bygones be bygones and get the money. 

My wife and I are in the same boat.  We have little equity left in our home and have been trying refi with no luck.  We just want to be able to sell it since the house in Chicago and we live in Denver now.  We have good tenants but I don't want to be a landlord from so far away.

4:05 am
February 7, 2013


mark.2020

United States

New Member

posts 1

Post edited 4:13 am – February 7, 2013 by mark.2020


Hi

 

I'm quite new to this forum but ofcourse I've 5 years of practical experience in renting my property.

 

From your message, I felt that you kept yourself only limited to earn money. Ofcourse this must be the first thing but together with it, you also keep other factors under your eyes. Such as when you'll rent your home, new people coming there can never take as much care of your property as you can etc. 

 

So if I were at your place, I prefer to calculate the share of my wife going to be an x-wife and I give her, after that I were a single owner. Then I rent my home with an agreement having several things.

Sweat more in peace

 

Then bleed less in war…!

7:01 am
February 7, 2013


krantcents

Member

posts 909

Welcome aboard

krantcents  – Making Sense of Money

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Follow me onTwitter:  @krantcents

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1:28 pm
February 12, 2013


ayoungpro

Lehi, UT

Member

posts 184

Owning a rental property with positive cash flow = Good

Owning rental property with ex-wife = Bad

 

I would cash out some equity with the refinance to either purchase your ex-wife's share, or allow her to do the same.

5:58 am
February 20, 2013


finetunefinances

Member

posts 33

I'd sell, you don't want the stress of dealing with the ex after all!! 

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