All Forum Posts by: Damian S.

@Ashish Khera You can definitely make a loan to the LLC, however I would keep this at arms length and charge a proper interest rate so that it does not look like the C Corp completed a distribution of its dividends. Prepare a loan agreement and report the interest that the C Corp will receive from the LLC.

@Meera Lakhavani The prices on rehabbed properties in that area are already high enough, so given you have a fully rented building you will be covering the expenses (not sure if you want any roommates). You also have to be very careful with how good of a job they did fixing up the property as most of those buildings are over 100 years old. Deals are always to be had but hard to come by and definitely better on properties that need work in most cases. It is a little easier to cash flow and house hack with larger multis as you get a better price/unit.

Welcome @Meera Lakhavani! You will need to find out more on how 203k loans work if you will be getting anything needing work. Since you are new to investing I wouldn't get into a full blown project requiring extensive repairs. Crunch those numbers after analyzing all expenses and what you can get from rent to make sure that you will be cash flowing no matter what or at least breaking even. 

Welcome @Paul Grachan! You've come to the right place to get started and I'm sure everyone will appreciate your advice. Enjoy the boards and best wishes in the near future! 

@Alex Sanchez There is a few on this board - I would give them a call.

The broker made a mistake of referring just one party for the inspection (minimum of 3 should've been the case). Being out of state it's simply unacceptable that not a single investor looked at the property, you can't expect every single seller to be honest - that's just not how things work. Due diligence is the investor's responsibility so if Schedule C/E were not requested and reviewed that's a big mistake.

Welcome @Efrain Gonzalez! Learn as much as you can and once you find a good investment, as long as the numbers make sense go for it.

Using an IRA as a loan extension tool is prohibited, that's IRA basics so there is no workaround no matter how you structure it. I suggested notes with established rehabbers as their main goal is to exit quickly so they need that note paid off to convey the title. I'd also look into a Roth conversion, take the tax hit now and depending on your future outlook have the tax taken care of.

@Ray P. I would do what you are comfortable with and no strategy will work the same for two individuals. If you know reliable rehabbers then you can get into the note business and see how that goes. Traditional investments are more hands off, but I would work on growing the account a bit before you get into buying individual properties. BRRR would't necessarily be an exact option since you can't refinance and if you are flipping then there is the potential for a UBIT consequence.

@Beverly Fast Sinclair I would definitely use an attorney well versed in this arena as there are special language requirements that the IRA/LLC needs in its Operating Agreement. They will also be able to educate you on how the LLC should be run so as not to run afoul and cause a prohibited transaction.