NEED LEGAL ADVICE

October 27, 2004 | GYPSY286

[GeronL]

It's one of those weird laws. Don't let anyone have access to your account, especially PBS and NPR.

[dila813]

integrity ... worth the world to me, thats why I am debt free.

How much is your integrity worth?

Was it integrity that told the person who deposited money in my account that they could go into my account without notice and try to make an unauthorized withdrawal?

Was in integrity, when they continued to attempt to withdrawal funds with the bank was reporting an NSF every-time they attempted the transaction?

Was it integrity for them to make me incur $20 NSF charges for each time they attempted to withdrawal the money?

Was it my intention to not return money if it didn't belong to me? NO, I had every intention to give them the money back if they made a mistake. What they did was just a gross abuse of banking data I provided at their request.

How much would you pay this company? $130? $10? Nothing?

Remember, the company won't accept anything but $120 as paid in full.

They don't accept responsibility for trying the transaction 6 times. So a 130 dollar bill is now a 250 dollar bill.

I am sure people that have money to burn would just pay the 250.

[ChefKeith]

Rule #1:

Use banks to cash checks, put it in your pocket and NEVER trust them with your money.

(They can't screw up what they don't control)

[wardaddy]

A) Your kids owe the first bank the overpay.

B) I'd pay that and tell them to eat shite on the NSF ad nauseum fees.


* I carry a lot of commercial paper (mid7s) (and some residential like most happy idiots). Banks will do what they can get away with unless you have leverage with them.

** My little brother deposited cash money at 1:30PM on a Tuesday. He went out and made 6 pissant purchases for gas, ciggies etc. The bank teller failed to post his cash before 2:00PM...the cutoff. Hence, even though his Novus/Visa debit card honoured the 6 debits that totaled maybe 50 bucks, he got hit with 6 35.00 NSF fees several days later and him not knowing that then had a number of other NSF charges since all the NSFs whacked out half of his balance. It was fubar. The bank had his cash on Tuesday before cutoff and he had the deposit slip to prove it yet they did not post it till Thursday nite. This is just one way banks hold your money for free. It was Bank America Murfreesboro TN, I called and talked to the president with whom I had zero relationship and got nowhere. He closed the account and moved.

Banks can suck bigtime. I prefer smaller county and state banks (First Tennessee is a good one here) because they know you and will work with you and don't pull this shite. If I'm overdrawn beyond my limits or I'm late like when I had big surgery last February, I get a courtesy call and some grace to fix it.

My dad once had a line of credit at a bank what was bought out by Suntrust (another big a-hole bank). They out of the blue yanked his LOC and gave him 30 days to find placement. This was a large LOC and by providence Dominion Bank in VA came to the rescue. Within one year my dad sold that firm to some Brits for about 25 times the value of that line of credit.

Commercial banks can be real stupid. The presidents are politicians who pump hands, grace social functions and seek deposits and good loans. The elves underneath that "face" are the real bank.

Any bank that goes broke is being run by crooks with bad loans to pals or just plain stupid.

Just my view on banks....I live by them. I grovel for them. Choose wisely and get to know them.

[general_re]

Looking back, though, I'm not entirely sure why they tried to pound it through four times. As I said, they were surely entitled to try, but it's not exactly a smart move, insofar as four rapid-fire NSF fees in a row will tip your hand to your former clients - they'd have to be pretty stupid to go deposit money into that account once they got wind that their former bank was trying to hoover it back out. Had it been my call, I would have attempted electronic recovery once, maybe twice, and then simply passed it off to the lawyers for further action. That would have been the smarter move, but then again, the smartest move of all would have been to not foul up the initial transfer ;)

[Southack]

"Any bank that goes broke is being run by crooks with bad loans to pals or just plain stupid. Just my view on banks....I live by them. I grovel for them. Choose wisely and get to know them."

Banker Speak: "But he's a really great guy" translates to "ain't no way we're lending money to him!"

Banks aren't normally run by crooks, but crooks do typically hatch from once-innocent insiders.

Book to buy if you've never gotten a loan before: "Romancing the Loan"

Secrets to getting any loan you want at the best rates:

1. Show more than one way your business can repay the loan other than your reason for the loan itself (e.g. other rivers of cash flow),
2. Show more assets than your loan amount,
3. Be large enough that multiple banks have to negotiate various participations with their peers due to your needs being over their loan limits, or
4. Have so much borrowed from one bank that they have a vested interest in you not failing.

Banker Speak, Part Two:

1. Owe $1 million and the bank owns you,
2. Owe $100 Million and you own the bank

Life is good!

[wardaddy]

I cannot amen that sage advice and observations enuff.

Sounds like you've been there.

It is nice when banks hear you are drumming up another deal and they compete to loan you the money.....I remember my first commercial mortgage....I would have sold them a kidney as collateral...lol....now, they cooperate pretty good.

Ah yes, the Donald Trump method of staying solvent even if lease up is a bit slow....make your survivability paramount to the bank....hence I prefer smaller banks where I have relationships and the threshold is lower.

And be honest....they may not be M&A wizards but they are not blind to inflated P&Ls..lol

I try to generally keep my debt servicing down to 30-40% of gross revenues and my loan to value is never over 60% even though they will go to 75-85%....even higher on SBAs (which I am not crazy about)

Also...a good appraiser...who knows your business is everything. Get a doofuss appraiser and you'll pay for a second appraisal...lol

Funny thing about financing and cross collateralizing.....there are so many ways to play that monopoly game....but don't get greedy even though skimming a bit of equity on that REFI is tax free....I can't resist a little...you can eat cash flow but you can't eat equity.

Another rule is unless you must have partners....sell debt...not equity. That is a cardinal rule for me unless the deal is huge and lucrative and too big for me alone....but then I make sure I have a buyout down the road in place.

Man....I am gonna be mighty sad when interest rates go back up to 8-10% one day. I'll be sitting on my hands unless I can get longterm evergreens.

I should buy your book. I am a newbie...only 7 years in real estate but I love bricks and mortar...and location, location, location.

Regards!

Damn is this a rainy October or what. This should be my best car wash month dammit. I need a good witch doctor...you know any?

[Southack]

I think that your car wash business rules!

Over the past week I've been wondering just where the breakdown occurs between paying cash flow for a hand-wash only labor-intensive car wash store front versus putting in the full machine and paying for the equipment up front.

I'd also like to do a co-business with me owning the car wash and a 2nd "friendly" business on site selling the new graphic decals that wrap around half the car, and perhaps a 3rd selling wheels/tires or some such...sort of a one-stop mecca for upgrading your car's looks.

Make a hit on that sort of concept and you could franchise nationwide.

[Smartaleck]

Suppose your son sent $400 to the bank instead of $200 to cover the "fees". Would the bank be right in keeping the extra $200.....after all, it wasn't their fault?

The answer is no. This would be, as they say in the legal world, "unjust enrichment."

[yukong]

That was my thought also. They were fully within their rights to keep running it through, but it was stupid. I am now curious about how much the overpayment was. Must have been a bunch.

[wardaddy]

Car wshes have great margins if located well.....80% in peak months.

Buy only the best automatic (roll over) and self serve equipment.....Mark VII out of Denver (also the most expensive but folks will know it's the best touch-free)

The best chemicals are from Lustra...near Chicago....again the most $$$$ but the best and need less water.

I love it but finding good locations is very very hard.

Tunnel washes where folks get out of the car can be huge profit centers but I don't like much labour anymore and the labour one uses with those is sort of crack and gack head day labour.

In any event....along with mini-warehouses and upscale trailer and RV parks and Marinas.....all about the best bang for the buck commercial real estate I know of.

I do fancy brick car washes that look nice...no worse than a McDonalds....not those worn down sheet metal jobs....and I keep them spotless. Very Important....and I only do them in upwardly mobile environs....not in the hood...though one can make money in the hood, the land may only go down. After all, any of this stuff is in the end residually about the land.

[Southack]

I like your style: build brick, keep it spotless, buy the best equipment and soaps, etc.

But that angle doesn't excite my money. It's been done. Other people can no doubt do it better than me.

My interest is in more of an auto enhancement plaza. Hand car washes on a nice outdoor brick patio. Wheel/tire store on one side of the brick patio. Auto graphics/decal or parts store or oil change on the other side of the patio. Sonic drive in as an anchor store for the patio, (gas station??), etc.

Create a one-stop shop for enhancing your car.

The goal being to first prove the concept with one such site and then franchise out the new name as a single or group buy-in deal.

But to franchise it out, you've got to show where the money cut off changes for buying the auto-wash equipment versus hand washing.

If you've got $3,000 per month in payments to cover the purchase of your auto-wash equipment, and if you are clearing $10 per wash, then you've got to do 300 car washes per month just to cover your debt service for that equipment, rain or shine. So if you are doing less volume than that, the numbers look better for hand washes. More volume, and the numbers start to warrant the risk of paying for expensive auto-wash equipment.

Where is that point? What's the volume required to warrant the machine versus all hand labor?

And then there is image: do you want to go with the all-labor hand wash to draw people into your new auto-plaza-patio concept, regardless of the numbers on the auto-wash?

And the mix of stores located on your patio might need to be revamped, too. It might be that what people really want to do is drive in, drop their car off to be washed, while they walk over to any of several lunch-time restaurants on your patio. Kill two birds with one stone, or some such.

Then you'd have to design your concept to handle lunch time business rushes instead of trickle volume.

[general_re]

I'm wondering (idly speculating, anyway) if it was a bunch, and someone panicked in trying to get it back before the boss found out something went wrong...

[wardaddy]

With a decent one automatic bay and 4 self serve bays. I can do around 22-28K monthly average over the course of the year.

I'm 40% Loan to Value so I have some cash in it. My return on my cash invested is around 25% net net.

I only build on land likely to appreciate.

My mortgage blend in 15 amortization.

10 on equipment/15 on real property

Depreciation on eqipment is 5 years for taxes.

My automatic should average 60-80 washes per day with Thursday nite to Sunday nite being 80% of your money.

4 self serve bays should equal one good automatic.

Vacuum islands are cheap and low maintenance....each should produce 200 bucks per week. I have 5 on the site I'm describing. I would advise putting all codes will allow.

If an automatic bay is doing over 10K per month you need another one....which is what I'n doing on this one.

If I weren't drawing income and leveraging and all that, I could pay it off in around 5.5 years.

Best deals I've done since I bought a 2200 tonne freighter in Ravenna Italy in 1988 for 265K and put her under time charter immediately for 1850/day for 3 years.

I love them. I like self storage too but it takes longer to get from A to B but the NOI and Cap Rate values are much better.....a car wash even at it's best will be based on construction cost and land appreciation unless it's a hugely successful one.....like some in SoCal that do 10 cars per hour all day every day. 6000 washes per month on the automatic....very rare.

[Publius6961]

Come on you guys. How many of you know to the penny how much you are getting if you cashed in a 401K or IRA? I know I would have probably only known an approximate amount.

BINGO!

The financial whizzes criticizing these kids either have no life or have never had an IRA or 401k for any length of time. The value can change daily...

[Southack]

"Best deals I've done since I bought a 2200 tonne freighter in Ravenna Italy in 1988 for 265K and put her under time charter immediately for 1850/day for 3 years."

I think that I owe you a trophy for the prize flip of the decade! Clearing $1.5MM in 3 years on an initial $.265MM investment deserves some sort of award.

OK, OK, so I'm not including crew costs and fuel, so sue me...

...Anyway, I still think that your auto-wash rocks.

But I still wonder where the break occurs. It looks to me as though you are netting around $6 per car wash.

OK, but can someone clear $6 if they hire hands to give an all hand wash...and thereby not have any money tied up in the auto-wash equipment, bricks, mortar, etc.?

To franchise the concept, that answer has to be known because potential franchisees are going to ask "Why" buy the auto-wash equipment.

[wardaddy]

expenses on the ship ran about 50%.....plus another 40-50K for drydock and bottom paint at some point.

typically ship's owner is responsible for crew, lube, food, and repairs and downtime deductions.

i simply do not much like labor anymore personally. i have cash paid managers in self storage and attendants in the car wash biz....all cash sub contractors essentially.

i know a jewish fellow here who makes around 750K a year on a very prosperous tunnel wash

i do prefer investments that have intrinsic value.....i am skeered to put a nut into something that can evaporate....however, real estate investments because of that tend to have less chance of a home run as say a fresh start-up service company would.


i started over at around 39 after divorce and am now much more conservative than before.

good luck!