All Forum Posts by: Kerry Drake

Here in Anchorage, rents run ~1% of purchase price, and prices are fairly steep. 3/2 (each side) duplexes easily run $450K and older 8/4 (total) 4-plexes are about the same. Occasionally one can find a SFR in the $100K range for rehab, but most are priced closer to $200K (with $250k-$300K ARV). Given this market and access to $250K via line of credit, I'd like to hear from the crowd what strategy they would pursue. Thanks!

Thanks to all for the responses. You've brought up some things I wasn't even thinking of.

Steven Hamilton, you say "NEVER ever hold real estate long term in any type of corporation." What is your recommendation for holding rental property?

I've been charged more for insurance when I turned my owner occupant home into a rental, despite there being less coverage (no content coverage). It seems to be generally accepted by the insurance industry that renters are a greater risk than owner occupants. The increase was about 30%.

I recently started a wholly owned LLC to perform fix and flips initially, with the idea of transitioning to buy and hold as the cash reserves allow. Is there any tax incentive, or disincentive, to transferring my primary residence to the LLC and renting it from the LLC? Or is it a wash since LLC income is passed through to the owner(s).

It also depends on what sort of reputation you want to have. I'd lean toward the complete rehab because my goal is to be known as making homes seem new. However, I'd definitely run the numbers to make sure the more expensive option made sense before committing to the expense; whether renting or selling.

Additional info--I am dealing with Credit and Lending (creditandlending.com), which must be one of the places my info was forwarded to by the Lendio site.

What was the timeframe? The rep I talked to was very specific about doing only a "soft pull" on credit score, at least initially to keep that from happening. Maybe they cleaned up their act a bit. Thanks.

I understand they are brokers, but what do you mean when you say they will not provide references?

I am creating a REI LLC and was pointed to Lendio for commercial credit. After visiting their web site, I received a call from one of their reps and he seemed positive about getting me underwritten for a $300K line of credit using an SBA program. If anyone out there has any experience working with Lendio, please share your thoughts. If it works out it seems it would be much smoother to simply tap a credit line rather than having to qualify loans on a per deal basis. Thanks!

Beyond the mortgage, what are you calculating that will amount to 50% expense-wise?