My monthly Schwab statement included a newsletter that featured an announcement about a new mutual fund Schwab is starting. It's called the Schwab Global Real Estate Fund and it will invest in REITs and REOCs (real estate operating companies). The initial subscription period is May 1, 2007 through May 30, 2007 and the initial price is $10.00 per share, with a $2,500 minimum ($1,000 minimum for retirement accounts and $100 minimum for custodian accounts). More information can be found here. The expenses are 1.36%, but they have agreed to limit them to 1.20% through 6/30/09.
As always, this is not a solicitation to buy or sell any security. Do your own due diligence.
Rental #1 Refi Update
On Saturday, I got an email from my escrow agent regarding the refi of Rental #1. It was the Quit Claim deed transferring the title from my LLC to my wife and I personally. This needs to be done because the lender will not mortgage to an LLC. As soon as the mortgage is recorded, I'll transfer the title back to the LLC. I again reminded the escrow agent that I plan to do this. She said no problem. I need to watch this, because I just know it's a step that will be forgotten.
Anyway, I had the Quit Claim notarized today and dropped it in the mail. I haven't heard if the appraisal of the property has finally been done or not. Last week, my mortgage broker called and asked for the name and contact number for the tenant, so he could schedule the appraisal. The number I had turned out to be out of service, which must have happened recently since it was a working number a while ago. I gave the broker the names of the other people living there in case he wanted to try to look up their numbers. I also gave him the phone number and name of my property manager. He said he would put the appraiser in touch with the property manager and let them work it out.
Anyway, I had the Quit Claim notarized today and dropped it in the mail. I haven't heard if the appraisal of the property has finally been done or not. Last week, my mortgage broker called and asked for the name and contact number for the tenant, so he could schedule the appraisal. The number I had turned out to be out of service, which must have happened recently since it was a working number a while ago. I gave the broker the names of the other people living there in case he wanted to try to look up their numbers. I also gave him the phone number and name of my property manager. He said he would put the appraiser in touch with the property manager and let them work it out.
Spoke With Property Manager
I got a call this morning from my property manager. She said she was following up and wanted to make sure I got my rent check. Well, it's a bit late to be returning the voicemail I left over a week ago, but at least she did return the call. I told her I got the check on the 24th and that I know she said her accounting department was running behind last month, but I hoped it wasn't always going to be that late. She said the checks normally go out between the 10th and the 15th, but agreed that the 24th was a bit late. Then she added "...although it was only 10 days late." I pointed out that 10 days is a third of a month! She said "Yes." and then there was silence. I think she got the picture that I didn't think 10 days late was acceptable.
The request for a rent increase for Rental #2 was submitted to Section 8. We're going to see if we can get $460 a month for it, up from $439. There are some repairs that need to be done to the property (paid for by the seller) and Section 8 needs to reinspect it to make sure it still qualifies for the Section 8 program. Some of the repairs had to be delayed because the tenant didn't pay her water bill and water was shut off. The property manager told her she needed to pay the bill or she would be evicted. The bill was paid by the next day. Once the repairs are done and the property has been reapproved for Section 8, we should be able to close escrow. We were originally scheduled to close at the end of this month, but that may get pushed back, depending on the Section 8 work.
The request for a rent increase for Rental #2 was submitted to Section 8. We're going to see if we can get $460 a month for it, up from $439. There are some repairs that need to be done to the property (paid for by the seller) and Section 8 needs to reinspect it to make sure it still qualifies for the Section 8 program. Some of the repairs had to be delayed because the tenant didn't pay her water bill and water was shut off. The property manager told her she needed to pay the bill or she would be evicted. The bill was paid by the next day. Once the repairs are done and the property has been reapproved for Section 8, we should be able to close escrow. We were originally scheduled to close at the end of this month, but that may get pushed back, depending on the Section 8 work.
Refi of Rental #1 Delayed
I got a call from my mortgage broker today. Apparently, the appraisal of Rental #1 hasn't been done yet! I had an appraisal from late last year, so we were trying to use the same appraiser to do the new appraisal, figuring it would be less work for him and it could be done quickly. That turned out not to be the case. My mortgage broker says the appraiser is not returning his calls and is just blowing him off, so we're going to use a different appraiser who should be able to get the job done in about 72 hours. I hope this whole refi can be wrapped up by the 15th of the month.
Another Louisiana Update
A month ago, I reported that payments on my investment in commercial property in Louisiana were close to resuming. I got word today that the lawyer who was drafting the second mortgage has been swamped for the past 2 weeks, but he promised to get a draft of the mortgage out today. The second mortgage holders have the funds ready to pay the first mortgage holders (including me) and we're just waiting for the paperwork to be finalized. The loan is about 4 months past due now and when payments resume, they will include past interest and late fees.
I also got the word that part of my investment will be repaid. My total investment was split over a couple buildings: $120,00 on two main office buildings and $30,000 on a parking garage. My portion of the parking garage note has been bought out, so I'll get that part of my investment back plus interest and late fees. I just sent over my bank wiring information, so I expect to receive the funds by the end of the week.
I also got the word that part of my investment will be repaid. My total investment was split over a couple buildings: $120,00 on two main office buildings and $30,000 on a parking garage. My portion of the parking garage note has been bought out, so I'll get that part of my investment back plus interest and late fees. I just sent over my bank wiring information, so I expect to receive the funds by the end of the week.
