All Forum Posts by: Corey McKinney

Thank you all for the advice and questions. Based off your responses I need to verify if the account is a personal portfolio account or a qualified retirement account. From there I could more accurately know what I will owe in taxes. I would love to use it as collateral to fund RE investments. 

@Account Closed By given, I mean it was an account started for her by a relative a long time ago. No, I will be investing out of state.

Can someone explain the options for cashing out money from an individual stock to then invest it in real estate? My wife was given a lump sum of stock in an individual company (Big corp./low risk) that a family member set up a long time ago with dividends reinvested. We are thinking of using this capital to invest in real estate instead as we are much more educated and knowledgeable (with the help of BP) in this field. What type of tax implications would we be looking at if we pull it out? Besides a self directed IRA, are there any other options on deferring or reducing the taxes I will owe? Obviously I would like to preserve the most amount of this fund in order to invest in RE.

Thanks!

I did this. It was ridiculously expensive. They ask for a ton of money up front for "access" to all their resources. After my large deposit, the first three months were free, but then it was an additional $200/month to maintain your status. The group calls/coaching placed a ton of pressure on just getting any deal under contract and figuring everything else out afterward. If you did have a property locked down you kind of got dismissed on the calls. In a short time BiggerPockets has delivered a higher quality of information, with ease and at the best price, FREE! If you have already found BP, I would personally not pursue with the "Freedom Mentor" program at all. Network here and talk to real people that offer real experiences and opportunities for no cost. 

What about all the other expenses involved with the property? We need to account for maintenance, vacancies, CapEx, and others which will could very easily put you into negative cashflow territory. CA has great appreciation, but that is a variable you have no control over. Plug the ALL the numbers into Rental Property calculator on here and see how it well it would do with and without you living there.

Hi Lucas,

Welcome to BP. It would all come down to the deal you get and what the numbers show. Make sure you are buying a true DEAL. Purchasing your own residence can bring your emotions into it and cloud your judgement. If you are able to secure a good property that you can build equity while paying the same amount you are now for rent, then it may not be a bad plan. 

My main issue is the debt to income ratio. After purchasing an expensive property in LA would you be able to qualify for any other loans or investments? You wouldn't want to cripple your purchasing power of other future investments by putting most of the money available to you (i.e loans) in one property that you would still have to pay out of pocket for. If your goal is to establish cashflow now then I would only consider deals that just that. There is always private funding and hard money but that is typically harder to secure.

I am in this exact situation myself and have shifted to looking out of state. For me personally it would be better to purchase many less expensive deals that instantly provide positive cashflow than one here in CA that may or may not. Just something to consider. 

Out of curiosity, what drew you to KC vs the others? I am also looking in the Midwest and I am looking at many of the same areas.

Post the SFH numbers when you can. Excited to see whats out there.

Hi Nelson!

Looks like a great deal. One word of advice that was given by  @Brandon Turner in his rental property book is if you plan to rent use laminate over the hardwood, as you know it will get abused. Keep the actual hardwood floors protected and have them finished when sprucing up the property for sale. This way you only refinish once and what is there remains intact for you to cash out on later.

Great info @James Wise 

I was told all this by a colleague and was curious if you could provide any insight on the topic. I was told some of the "multifamily" properties in the mid-west in general, are not actually multi's. They were SFH that have been converted in a sense to be a mock multifamily property (blocked off stairwells, added entry points, separated down the middle essentially). Is this true and do you come across these often? How do they get around the zoning laws? I assume its best to avoid these types of properties, if this is true.

Is there any other local info similar to this that an out of state investor should know?

Hey Ritch,

Can you send me that list as well? I am very interested

Welcome Bobby!

I have been keeping an eye on the potential house hacking market in LA but it is TOUGH to find a good deal that does not have 5-10 all cash offers already going for it. The deals here go extremely quickly and lately for above asking as I'm sure you know. This has caused me to start looking out of state until the prices here correct or there is another major drop.