New investor with TONS of questions :-)

[Macie D.]

Hi All,

I would like to take a moment to introduce myself.......and hopefully get in touch with some seasoned investors in my area who might be able to counsel me in this daunting process.

My name is Macie and I am looking to invest in southern Colorado. I have been eyeing investment properties for a couple years now. I have finally gotten to the point that I have a foundation to get started. I am looking in Colorado Springs, Fountain, Pueblo area; with my primary focus on Pueblo. I am completely new to real estate (I wasn't even involved in the process of purchasing my current home) so looking into some of this has been completely overwhelming.

What I do know is that I would like to purchase a multi-family investment property (although I have not ruled out single family if the numbers work for it). I have started looking at properties in my area with a local realestate agent.

I really do have alot of questions about how to effectivly increase my families income and protect our personal assets in the process. Especially questions regaurding formation of an LLC's vs. insurance with an umbrella policy for my investment. I'm sure I am going to need counsil from a realestate lawyer, a lender, an acountant, my realator and others. I would greatly appreciate referals for such counsil and/or any advice from other investors. I would really like to get a good start from the begining so I can make smart choices in the future.

Thank You all for taking the time to help a newbie get started.

[Rob Beland]

I'd like to comment regarding the formation of an LLC. My standard response to anybody considering this for liability reasons is that the only people that will advise you to set up an LLC are people that are going to make money in the process. I have owned real estate for about 15 years and it's all in a simple real estate trust that I set up on my first purchase. Bump up your liability limits to $1M for any property you own for investment. The trust was set up because my thought was nobody would know I was the owner and I wouldn't get sued. Guess what. Anybody can sue anybody at anytime for any reason. You own the LLC so they're going to sue the LLC and they are going to sue you personally. The only thing you are guaranteed with an LLC is that you will be paying more money out of pocket every year to have it (thousands of dollars between filing fees, accounts, attorneys, ). Keep the money for yourself. I have yet to hear a solid argument for setting up an LLC unless maybe you are going into business with somebody. Even then I would go with an S-Corp as an LLC is dissolved when one partner decides he wants out. The S-Corp lives on by the sale of shares to new investors, passing on to your partners heirs, or they could go to you. I'm not an attorney just sharing info I have learned over the years owning several businesses and many rental properties.