All Forum Posts by: Bonnie Low

Just curious why you're looking at those two banks for credit cards? I think there are better options out there - particularly cards that offer cash back and other perks. Do a little research on using CC's for your business and paying 0% interest - there are quite a few people who teach about this. One that I know of is Meg Stafford at Dreamy Capital.

It's not unusual for people to move into a new property. It can sometimes happen even shortly after buying a unit - life forces change sometimes. However, I think your bigger issue is going to be putting 5% down on a small multi-family. I don't know any lenders doing this other than possibly the VA (can anyone confirm/deny this?) Speak to a lender you can trust about this. If the property has multiple meters they're most likely going to see it as an investment property and I think you're going to be hard pressed to find one doing 5% down. It's also going to be difficult to cash flow in most markets if you ARE able to put down 5% but if cash flow isn't your goal, then that's irrelevant.

Colorado Springs has some weird regulations about this depending on which county it's located in so be sure to check in with the planning department in the specific county you're looking at. I had this come up on a house I was submitting an offer on. I was intending to rent out the upstairs 3/2 as an LTR then convert the basement to a unit for myself half the year and rent it out as an MTR (midterm rental) when I wasn't there. El Dorado County prohibited this, though it seems there are "creative" ways to work within their framework. I could have rented out the entire unit as LTR, MTR or STR. Or I could have rented out either the top unit as one of the 3 OR the bottom unit, but not both the top and bottom unit. Didn't make a lot of sense to me, but sometimes regulations don't make much sense. The person I talked to in the Planning department was very helpful and agreed that the regulations are ridiculous, but for the time being, they're still in place. Call and find out exactly what uses your property is eligible for before you do your underwriting because it will make a huge difference.

The "best market" is less about the market per se and more about the deal you're able to find in my opinion. You could be in an expensive market, like LA, but you inherited a property or you got a killer wholesale deal or subject to and the numbers could be very attractive compared to buying off the MLS for full market price in the same market. There are markets that have built in "gotchas" like the rising cost of insurance in coastal FL, regulations in much of the west coast states and property taxes in Texas; however, the deal itself is the most critical factor.

I recommend you reach out to a company like Corporate Direct to get solid advice on this and not try to piecemeal it together from various sources. If you have an LLC in CA, you are going to need to file taxes there for your LLC, period. Income generated from within CA has to be reported in CA. I know this because that is exactly what I have to do. I have a CA LLC (and LLCs in other states as well) and they are all held by a WY holding company. However, I have to file taxes in each state the LLC is in and pay the annual LLC fee in each state. Using LLCs and holding companies is less about tax structure and more about asset protection in the case of law suits.

I have offered it, but am unsure whether they're using it or not. Usually, tenants are receptive to the idea but I also wonder if tenants with a higher credit score care less about this feature than ones with a lower credit score who are actively working to rebuild their credit? I like this feature of Baselane and will be interested in hearing what kind of uptake there is.

There are SO many books and podcasts out there on getting into real estate. Just search the Bookstore here on BP and you'll find many. As for MTR, right now the definitive book on MTR is by Zeona McIntyre and Sarah D. Weaver and is called 30-day stay. That's a great place to start. If your friend is more of a Youtuber, turn him on to Erin Spradlin's MTR channel. Good luck! 

 A couple of things to keep in mind: you mentioned PadSplit. If you meant the company specifically and not just the concept of pad splitting, be sure they are available in your area. They actually have pretty limited reach as of now and focus primarily on major metro areas. Second, I'm a rule follower when it comes to permits. It's never worth it to cut corners on permitting because it will cost you far more in the long run. You need to make sure that your property is easily financeable if you decide to sell it in the future and any future buyer can call out non-permitted items and actually report you to the building department or, at a minimum, ask for seller concessions. If you're pulling a permit already for plumbing changes, just get the permit for the room conversions at the same time. They're not going to add much cost to the permit and you want to make sure everything you do is up to code. Just my opinion.

 Excellent point. If it's a simple living room to bedroom conversion, it likely won't be that difficult to return to "normal" if that's ever needed but definitely a great thing to keep in mind.

Most of my properties are already MTR, but I'd say I get more inquiries about them than I do my STR or LTR. As the popularity grows and people become more nomadic, I think we're going to see more and more of this. It's one of the reasons I love this MTR niche.