Just finished listening to your episode on my commute this morning. It was definitely an awesome one, good stories there. I must admit tho, I should revisit the episode to fully understand it after learning more about RE in general :)
Thank you very much for your generous time first of all, glad to know it's ok (it actually sounds better) without the corporation. One less headache.
Since I live in NYC, owner-occupant won't be possible :/ and would like to start somewhere within a couple hours of driving distance. But I will be sure to keep in mind Cumberland county for future projects - thanks!
Tips for beginners are greatly helpful - hopefully I find a cash-flowing property with little money down. I would like the idea of buy and hold better as well.
Follow up question I have (you may never be released from this thread
😈) - What would be the best way to compare growth of each county and crime rate, school system, neighborhood class etc?
and how do you tag a person like you did @claire Lee?
Thank you!
Originally posted by
@David Krulac:
@Claire Lee
1.imho Corporations/LLC are oversold. I think you find the property first. Most people don't recommend the corporation for rentals because of the doble Federal taxation. S corp and LLC are preferred, and LLC are less cumbersome. And YES, Pa will chrge you transfer tax if you transfer property from you to your corp/LLC or vice versa. And YES, insurance companies charge higher premiums for corp/LLC ownership than they do for individually owned property, and YES some lender will either not lend to corp/LLC, particularly new entities with no credit history. Other lenders will lend but may charge higher interest or fixed for shorter period. For example you mat be as low as 2.5% fixed for 30 years, with no balloon as an individual, but I haven't seen any commercial loans with those terms, unless you're borrowing from your grandmother.
2. Personally I invest in the fastest growing county in PA. (Cumberland County) and don't invest in ABE (Allentown Bethlehem Easton areas).
3. For new investors, I always say:
a. Look for positive cash flow properties
b. appreciation is icing on the cake, don't by negative cashflow properties just becase of some speculation of appreciation in the future. Noboy knows the future.
c. unless you are independently wealthy, borrow as much as you can for as long as you cab with the lowest down payments you can.
d. don't buy properties that are total wrecks or in bad, crime ridden neighborhoods.
e. I like starting with single family, duplexes and small apts up to 4 units that can be financed residentially and owner occupant.
f. Flipping can make you rich, but buy and hold will make you wealth.
g. Ihope you ;isten to my Bigger Pockets Podcast # 82
