All Forum Posts by: Bryan Carleton

Hey guys,

I see lots of people asking about 506 regulations but what about 506b or c vs a member LLC? Basically I have some friends that have lent me money in the past, I've done a few flips and paid them back. We structured it like a personal loan back then. However, now I'm attempting to do it the right way and file 506b. But why couldn't I just set up a member LLC, make them members and use the LLC to purchase a flip or a buy and hold?

Investment Info:

Single-family residence fix & flip investment in Waldoboro.

Purchase price: $52,500
Cash invested: $27,500
Sale price: $139,000

SOLD!!! After 53 weeks it's finally done and sold! It was awesome to pay back my friend his $27,500 plus three thousand in interest and the original owner his money plus interest.
Our most recent investment is this fix and flip. It comes from a family member that is retiring which also sold us other properties.
We’ll have $27,500 into it, a private investor will match that and the seller is financing $22,500 with 4% interest all due when the house sells.

What made you interested in investing in this type of deal?

A good deal was presented to me by my god-father who I've bought property from in the past

How did you finance this deal?

Half from a friend and half seller financing. The repair money came from a career starter loan at 2.99%

How did you add value to the deal?

I put $30,000 in the rehab and added about $80,000 in value. I did this thanks to my father doing 90% of the work at the father discount rate ;)

What was the outcome?

We finally sold for $139k!

Lessons learned? Challenges?

We should have set up an S-Corp first and we will do that for future flips.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Jessica Poole from Remax helped us at every step of the way

Investment Info:

Single-family residence fix & flip investment in Waldoboro.

Purchase price: $52,500
Cash invested: $27,500
Sale price: $139,000

SOLD!!! After 53 weeks it's finally done and sold! It was awesome to pay back my friend his $27,500 plus three thousand in interest and the original owner his money plus interest.
Our most recent investment is this fix and flip. It comes from a family member that is retiring which also sold us other properties.
We’ll have $27,500 into it, a private investor will match that and the seller is financing $22,500 with 4% interest all due when the house sells.
UPDATE: The house is all done and on the market for $149,000
https://www.zillow.com/homes/for_sale/84989696_zpid/globalrelevanceex_sort/44.090221,-69.360616,44.07382,-69.389927_rect/14_zm/1_rs/

What made you interested in investing in this type of deal?

A good deal was presented to me by my god-father who I've bought property from in the past

How did you finance this deal?

Half from a friend and half seller financing. The repair money came from a career starter loan at 2.99%

How did you add value to the deal?

I put $30,000 in the rehab and added about $80,000 in value. I did this thanks to my father doing 90% of the work at the father discount rate ;)

What was the outcome?

We finally sold for $139k!

Lessons learned? Challenges?

We should have set up an S-Corp first and we will do that for future flips.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Jessica Poole from Remax helped us at every step of the way

Thanks everyone, all great responses. I'll start putting together the numbers to see if it makes sense to BRRRR

I have a property that was meant to be a fix and flip. The reno is done and it’s on the market.

510 Friendship rd, Waldoboro, Maine

I think we're coming up on 2 months and not a single offer. So I'd like to at least explore the BRRRR strategy for this house. However, my agent has put a lot of work into this house. She came over before I bought it, for real, and helped me with what to reno and ARV. I used a lawyer to purchase the home so she didn't get anything. She's done a lot of work putting it on the market at well. I love working with her and I'm using her for our next project as well.

The answers I’d like to avoid are the cold hearted ones. That’s just not me and I don’t want to operate like that. Has anyone run into this before? Should I offer to pay her some small amount? Is the reality that I just have to be cold hearted?

Looking for recommendations for a CPA in Mid-Coast Maine. Thanks!

Thanks all!

@Alina Trigub 

Can you help me tell me what would make it not worth doing? I assume you mean there are extra costs involved?

@Brent Shields Thanks, that is a great alternative. I assume, however, that while I can tie the loan to the property, I probably can’t tie their returns to the performance of the property. The returns probably have to be set in writing prior?

Hello, I've got 4 buy and hold duplexes and 1 SFH that is a fix and flip which is done and currently on the market. One of the duplexes is being renovated now and I'm looking for more.

I have a couple of deals I’m looking at but I need to raise more capital. I’ve been reading over the SEC’s website and it says that all investments that are not an accredited investor, friends or family must go through a broker-dealer or a funding portal? If someone could help me understand this process better I’d appreciate it. 

Thanks @Bob Langworthy! I would absolutely love to start going to meetups but I’m on active duty for a few more years so that would make it impossible.