All Forum Posts by: Derek Martin

As mentioned, this strategy can greatly impact ones creditworthiness. And it's difficult enough determining how to allocate limited cash among rehab, reserves, and the next deal. I wouldn't dare bring credit cards or hard-money into the mix. But everyone has their own considerations and tolerance for risk.

I am doing the cash+rehab+refinance method you described with SFR in the Chicago suburbs. It can be done, but there are definitely some limitations. For example, my lender (local bank) requires 6 months seasoning (having a renter) after the rehab. Also, they will only cash-out refi 4 properties. So I need to pay one off before cashing out the fifth.

However, they do 75% LTV which allows me to get all the cash out. A deal in my area might be a $50k purchase and $20k rehab. It rents for $1300-$1400 and appraises for $100k-$120k at the cash-out refi.

I would recommend this "rinse and repeat" method as a slow and steady way to build your portfolio. But it's not the fastest or easiest. For that, nothing beats private money. 

Congratulations @Larmon Cummings Jr ! Was this the one you presented at the last meetup? Please keep me updated with any deals you get in those south suburbs!

Great find @Jake Hottenrott ! I would do those deals all day long. 

Looks so much better with your paint colors. 

Sounds like a great idea. Shark Tank, REI Edition!

I believe you can convert an Illinois LLC to an Illinois Series LLC by filing Articles of Amendment with the Secretary of State. However, it is not common and I have never done it. You may wish to call the S.O.S. LLC Division at 217-524-8008 to be sure.

Instead, I would recommend you just spend the extra $250 and create a series LLC from the start. As others mentioned, series do not need to be created until later, if ever. The yearly fee is the same for a LLC and the master series LLC. Good luck in your investing!

Strong feedback! I appreciate it. Instead of saying I could take it, I should have been clearer by saying I would like to take it out of the security deposit.

But thanks for pointing me in the right direction. Everything was repaired immediately and we've been working with the police. Life goes on. Thanks to all who replied. 

Last week one of our properties was broken into. They kicked in the back door and allegedly stole a fairly significant amount of cash. The tenant was very upset and I feel very bad for her. 

However, I obtained a copy of the police report. It states that the tenant's daughter had three juvenile boys over at the house the day before. The daughter was showing off and showed the boys the stack of money. Nobody else knew the cash was there. The house was broken into the very next day. Everything was untouched except the cash was missing. 

Again, I feel horrible for the tenant. I replaced the door and frame immediately at a cost of $550. Does anyone have any experience - or words of wisdom - on passing along this cost to the tenant?

I could take it out of her security deposit, but I feel this should/could be separate. 

Crime in Calumet City is high...and it's getting worse. However, there are still good pockets. And, in general, rents are very high relative to property values. You should get good cashflow there but I wouldn't put all my eggs into that basket.

Nice deal! @Carolina E.  

I own some property in Lansing, the next town over. If you're looking for a buyer or partner, I may be interested. Keep me in mind and good luck!