All Forum Posts by: Brian Levredge

We took over a house that a client had purchased that was rented by the room and it was a mess.  We ended up evicting half the people there, which was its own mess because there were no separate addresses for each of the rooms so the sheriff was thinking we needed to set out everyone's belongings, which wasn't the case, but I digress.  

I think unless the "roommates" all know each other you're asking for trouble.  Can it be done?  Yes, but I'm not sure it's worth the trouble of pursuing.  

@Nick Wehrley Banks with low/no fees on checking are Southern Heritage Bank, SmartBank, and SimplyBank.  I bank with a number of other banks in town in addition to these but off the top of my head the others are starting to get a little pricier on things accounts.  As far as functionality with ACH from a PM company you shouldn't have an issue with any bank at all.  I own a PM company, and with the exception of Wells Fargo, we don't have issues direct depositing into client accounts at all and even that issue with Wells is really with one client.  

Expenses on multi-family typically run around 40% including PM down here once stabilized. Your gross is currently $5940/month, so NOI would be $3564 a month on actuals. 20% down at 3.95% for 20 years (it won't qualify for longer-term) is $5551/month so you'd be losing about 2k per month. There is actually a lot of upside on the rents by about $300/unit, but even with that built in (9k gross), you'd still be losing about $150/month so it still doesn't work without a larger down payment. This is the kind of property you usually see someone 1031 into because they are running out of time, and rather than just pay the tax (which they should) they overpay for something that doesn't work well. Plus assume you'll have decent capex to get the units to a place in order to get $900/month per door and it starts to look much worse.

If we're talking local banks, I have yet to have one do a drive-by appraisal for a refi.  

If you want to send me a DM I would be interested in at least a conversation.  I own and manage properties all over town.  

As an aside if you search "Chattanooga Real Estate Investing" through FB's search engine, it'll pull up probably a dozen different pages.  I would look at joining those pages as many of the wholesalers (both local and otherwise) post their deals there.  

@Dan Beaulieu might be a great resource for you!

I would add there are F&E exemptions for closely held family businesses that own 1-4 residential (1-4 units each) properties. Don't know about brothers being non-exempt, but it's worth asking a CPA with familiarity with the TN tax code. I'd also just use a TN LLC if you decide to go that route. No reason to pay filing fees in multiple states.

The issue with this is the broker is the one responsible for auditing all the files and they are the ones on the hook with TREC if things aren't done properly.  It's one thing to have good systems in place, but it's another to go through all that info on a semi-regular basis.   So with that said the split can eat into your margins.  I've got my own PM company here in town so happy to discuss if you'd like. 

Feel free to msg me.  I should be around for part of June.