All Forum Posts by: Chris LumLee

I have a separate sub-savings account where I direct some of the income from my rental into specifically for CapEx/maintenance. When I first started with my property small amounts were taken out of the rent but bigger amounts I paid on my credit card and then paid for out of pocket.

I'm new to real estate investing. I have one rental unit and was looking for more but not long ago a friend recommended that I pursue fix-and-flip versus buy-and-hold because if done well it would get me "cash in the pocket". So the question is...and I know this will sound stupid...is there room to do this anymore or is it already overcrowded?

Thanks for the insight! I'll be sure to check it out!

I have a savings sub-account at my credit union where I park leftovers for house stuff. I figure I'd want to keep that handy for when the time comes that something goes out...and it's easier to access.

Gentlemen, @Jack Inman and @Rashard Alomari ! Thank you for your replies and insight!

Hi!

It depends what your investment strategy is. For example, if you want to buy and hold to rent out the properties, no matter because it'll produce cash flow.

Like everything...it depends.

I would have factored in other items in my budget calculations. Instead of the usual property taxes, insurance, property management fees, and loan payment, I would have also added in CapEx and a minimum cash cushion in case a need such as vacancy or other repair needs to be made.

When I bought my rental I went all in just to buy. Luckily I have three jobs so I could eat the initial vacancy and expenses that came up. But definitely hold some back when you're getting into it.

I was in a similar situation. The tenant was paying closer to the middle of the month. The property manager (PM) put a clause in the lease agreement that if they're late three times then the lease can be revoked. After the second time I reached out to the PM to see if some kind of arrangement can be made to accommodate the tenant's late payment- whether that be move the due date to later in the month of whatever. The PM later emailed me back saying that the tenant's work pays in the middle of the month, which is why they've been late. At least they've been paying. So they worked with the tenant to move the due date to the middle of the month.

The PM also told me that the tenant was thankful for that. I suppose depending on when you 'need' the rent money, you may or may not be so lenient. I try to be accommodating because I would love for the place to have a renter once the lease is over.

Before I bought my rental I had a similar question. I hate this answer but I have to give it here: "It depends."

For me, I was saving for a down payment and the I had to get a new car so I focused for awhile on cutting down the car loan amount. I'd say it was maybe 80/20 (car/down payment savings). But now it's probably closer to 50/50 because I'm far enough ahead on car payments that I'm fine as long as I keep paying the minimum. If it's credit cards on the other hand, pay that sucker off pronto. It does depend on the type of debt you have. Credit cards, student loans. Get rid of them. Car...up to you how quick you want to get rid of it. I'm saving for a second place now so I'm down to about 75/25. But once I pay off my car I'll rip and roar to save all for the house.

So it really depends on how comfortable you are with having the debt and if you're confident you can manage it well. If you're okay with it, then by all means save for the house once you get that bad debt out of the way. Otherwise, if the idea of debt keeps you up at night, then get rid of it all then focus entirely on saving for the investment.

Best of luck to you!