All Forum Posts by: Demetrius Davis

Thanks! Given that the amount is standard, does that mean that it doesn’t matter whether a 3 bedroom is high end instead of basic and not renovated?

Can anyone share their knowledge of what Section 8 is currently paying for 3-bedroom apartments in Bronzeville - Chicago? I assume it’s a range based on amenities and updates. What’s the range that you’ve seen?

Update: I spoke to my lender and was told that there shouldn't be a problem using rental income that's going into the LLC as qualifying income for my next purchase. However, he did mention that I should own the LLC 100% or I would need the other person to be on the loan in order to count all of the income.

 Thanks!

I'm closing on (2) 4-unit buildings in Chicago over the next two weeks. Both mortgages and deeds will be in my name. What kind of entity/entities should I form to hold and run these properties? These will be my first multifamily properties, although I've owned single family rentals for the past 6 years. To date, I've held all properties in my name and used a separate personal bank account for funds, but am now concerned more about maintaining anonymity, protecting assets, and overall structuring the business properly in order to scale the business. Secure PayOne (landlord's assistance) interfaces with the tenants virtually on my behalf. When I'm at the properties, I tell tenants that I work with the management company, rather than that I'm the owner. I've read that I should put the buildings in a land trust for anonymity and as a way to avoid triggering the due on sale clause. Also, that I should form an LLC to be the "manager" of the property, and let Secure PayOne deposit all rents into the new LLC's account. Lastly, that I should get an umbrella policy for asset protection. Is this the best way for me to structure things? With rents going into the LLC, instead of my personal account, will I run into issues when I look to qualify for the next residential multifamily mortgage in my name? Thanks for your help!

Thanks for this advice, Paul! That's very tricky now because removing the basement, removes $1400/mo of income. But I realize that some of my competition includes owner occupants, in which case they're not strictly tied to the property's income producing ability.

Thanks, @John Warren! Will do.

Thanks @John Warren! This is helpful. Our attorney submitted a request for a purchase price reduction based on the 3-unit status yesterday. Waiting for the seller’s side to respond. There were 13 other offers and the appraiser didn’t catch that it was a 3-unit (appraised out), so the seller feels emboldened. We’ll see how this plays out.