Suze Orman Talks To A Strapped Realtor

[Angio333]

YouTube - Suze Orman speaks to strapped realtor

Wow, the realtor dug herself a HUGE hole! Great advice from Suze, what do you think?

[Ima saver]

Yes, I think it was good advice. I would not advise anyone to take on a rental. We had 3 and lost money on all of them.

[disneysteve]

So many people, even real estate professionals, get burned on rentals. How many posts have come through here from people who had rentals that they were losing money on each month? If you are going to purchase rental property, you MUST have positive cash flow. The rental income MUST cover ALL of your expenses and then some. And you need to have a huge cash cushion, a year or more, as Suze suggested.

[gamecock43]

Ok, Heres my situation on the rentals. My mother bought a CA property in 1976. She lived in it a yr or two- met my dad, they bought a house nearby to raise a family. They each rented out their CA condos for a small loss.
They keep the condos and 10 yrs later decide to sell one condo. They sell it, pay off the 1st condo completely, and pay off a good portion of their current mortgage. Today, I inherited the property, I get a monthly rent check free and clear except the HOA every month. SO in my case, renting for a loss in the beginning leads to long term wealth. It just took a few decades.

[Like2Plan]

...what do you think?

I was wondering about a couple of things. The realtor had a 1st, 2nd and 3rd mortgage? Does she have to get all 3 mortgage holders to agree to a short sale? If so, how would the folks holding the 2nd and 3rd mortgage ever agree to a short sale since they are in 2nd and 3rd position to being paid?

Another thing I was pondering--the realtor had said her fico score prevented her from getting a better job. How is she going to be able to rent an apartment without having a good score? Don't they routinely run credit checks on future tenants?

[Angio333]

Lanlords sometimes run credit checks. My current apartment is the top part of a duplex with the landlord living below us. She did not run a credit check on us and we have great credit.

At least in my area, there are empty apartments everywhere, and most have been empty for a long time. So it would be pretty easy for someone with bad credit to find an apartment.

[MiikeB]

Also, landlords are not interested so much in the FICO score as they are looking for reports from past landlords on not paying and defaulting on loans etc. To most apartment complexes no credit and neutral credit is fine.