All Forum Posts by: Brad Z.

I have used a credit partner with the following terms and it worked well for both parites

*Credit partner purchases property in their name and immediately transfers to LLC

*50/50 owners per LLC operating agreement

*Each partner fronts 50% of down payment and any renovation that is needed.

Its a great way for an experienced investor to add a property without another loan in his/her name and a great way for a new investor to learns the ropes from an experienced investor.

Just like any business, there are going to be things that go wrong, and you will have some sleepless nights. Focus on running a stand up business, with integrity and ensure you go above and beyond when it goes to tenant safety and disaster prevention. Check smoke detector batteries, provide a CO detector, put a fire extinguisher in each unit, carry adequate insurance, install hand rails, have a solid lease, get a big balloon policy and do the right thing. Beyond that, bad things can happen, but its beyond your control.

Also, if you quite buying rentals and open a grocery store, you could have somebody fall and get sued, it can happen anywhere in any business/industry. You might as well stick with a business that is the most profitable based on you skill set and motivation!

This does work but a professional tenant can smoke you doing this. In theory, if you accept partial rent, you cant evict. Its possible for a tenant to deposit $1 and you cant evict them for another month, or at least it makes it much more of a challenge.

I collect rent via a couple of methods.

Drop Box: I have a lockable drop box in the basement of a few multifamily properties. I state that it is picked up by as early as 5pm on the 5th. I take pay or quits with me and no rent in box, notice is posted. I dont like this because I have to drive out every month but it does force you to be prompt with the pay or quits and exercise discipline with tenants.

Mail: Receive checks at a usps post office box. I provide stamped envelopes to tenants. Some stores will send you an automated email when you receive a piece of mail

Electronic Transfer: I use erentpayment.com This is obviously my preferred method but not all tenants are comfortable with this.

I'm trying to migrate as many tenants as I can to electronic transfer through attrition but i have alot of existing tenants from recently purchased properties. The one method I absolutely refuse to deal with is a phone call to "meet and pick up rent". This worked with a few units but once you manage 10,20 or 30 units, it would get really old.

I am getting ready to make a large purchase to start a project and called around to a few stores. The manager at the pro desk told me his orders have been running 10%-15% off and this week, through saturday (6/30)., they are adding another 5% off bid room orders. Ill have a lowes coupon in my back pocket but hopefully this plays out. Im not sure if the additional 5% off is local or national.

I am second generation and have around 35 units right now. I learned a lot growing up and seeing how the business worked but currently deploy a completely different strategy. My father invested in land, commercial property and class A residential units. He did very well and mgmt was minimal through the years. I am a bit more hands on and invest in slightly lower income areas, probably have a little less appreciation potential but cash flow alot more per door..

When you hear of landlords losing their portfolio, its typically because they paid way too much for properties in the first place. In our market, you can pay 35k-50k for a house that sold for >100k 5 years ago. I think you can really limit your downside risk by making educated purchase decisions.

I typically stay within 5-7 zip codes but they are not adjacent. I have a few areas in Northern Kentucky that I like and a few areas in Cincininati that I prefer. I know these areas well and seem to be able to find deals when I am actively buying. When I have more time, it will definatley be a focus of mine to expand my footprint and learn the in's and outs of other areas that are close enough to me to be active and hands on.

Depends on your risk tolerance, current condition of your props, etc.. I keep biz and personal cash seperate. I try to keep about 20k liquid in the business on a basis of 35 units. I think you need a minimum/per door up to around 10 units or so then you can scale off a little bit. As mentione above, banks want 6 months PITI so that should be your minimum regardless if you want to continue to grow.

If you have that kind of financial discipline and the simple fact that you found this website are pretty good signs that you are going to be successful at whatever you do. I would spend some time learning your local markets, meeting with local banks, etc. It sounds like you are a conservative so leveraging a portion of that $ may be a good balance to take advantage of record low interest rates and home prices.

Good Luck!