"now I factor in a buffer for unexpected assessments when evaluating potential returns."
Smart move. I've found that even with thorough research, there's always something unexpected lurking around the corner—like when our HOA suddenly decided to upgrade landscaping (who knew shrubs could cost so much?). On the credit side, I've noticed some lenders offer better rates if your HOA has strong reserves and fewer surprise assessments. Definitely worth factoring into your overall strategy... every bit helps when you're leveraging home equity for monthly income.
I get the logic behind buffering for unexpected assessments, but honestly, I've found that sometimes being overly cautious can hold you back from decent opportunities. A few years ago, I was looking at a condo with a notoriously unpredictable HOA—everyone warned me about surprise assessments. I almost walked away, but the numbers still made sense even with a worst-case scenario baked in. Sure enough, we got hit with a roof replacement assessment within the first year (ouch), but the appreciation and rental income more than offset it over time.
My point is, buffers are smart, but don't let them scare you away from deals that still pencil out overall. Sometimes those "unexpected" costs aren't as damaging as they seem at first glance... especially if you're playing the long game.
Good points about not letting caution turn into paralysis. I've seen people miss out on solid deals because they're too worried about the "what ifs." Personally, I always build in a buffer (credit nerd here, can't help it...), but I agree you can't let worst-case scenarios dominate your thinking. If the numbers still work after factoring in some curveballs, it's usually worth taking the leap. Glad your condo worked out despite the HOA surprise—sounds like a win overall.
Totally get your point about not letting caution hold you back, but I think there's a fine line between being proactive and taking unnecessary risks. When I refinanced, I thought I'd covered all my bases, but still got blindsided by some unexpected appraisal fees. Nothing major, thankfully, but it reminded me that even careful planning doesn't always catch everything. Building in buffers is smart—just don't underestimate how quickly those curveballs can add up...
You're spot on about those unexpected fees sneaking up—even when you're meticulous, something always seems to slip through. Appraisal fees are a classic example; they're often buried in fine print or just not clearly communicated upfront. One thing I've found helpful is directly asking lenders for a detailed breakdown of all potential costs before committing. It doesn't guarantee you'll catch everything, but it does reduce surprises.
Also, building in a buffer like you mentioned is smart. I usually suggest clients set aside an extra 5-10% beyond their initial estimates, just to cover those curveballs. It's not about being overly cautious, just realistic—because you're right, even the best-laid plans can miss something small that adds up quickly.
Glad your unexpected fees weren't too major though... refinancing can be stressful enough without surprise expenses popping up!
