All Forum Posts by: Eddie C.

@Vince DeCrow great point about the LLC pass through income vs. non-pass through. I didn't think about that but will add that to my analysis.

Has anyone considered the crowdfunding sites (ie. Realtymogul, Crowdstreet, etc)? Seems to be fairly straightforward and allows for both debt and equity stakes, with wide strategies (private/public commercial, fix and flips, residential, etc). Most require accredited investors, but many do not.

@Taylor L. I should have clarified, most of my liquidity is in index funds, with some scattered around specific stocks. I'm a fan of the index fund approach for long term growth. As far as my criteria, I've already come to the conclusion that I won't find any great deals in the NOVA area. I know others who have done well, but their return was heavily dependent on appreciation, which is difficult to forecast. I'm looking out of state right now for the right deal (midwest, down south), but even then, it has been difficult. Thanks for the info on the meetup - I'll check it out and see if it is something I can make it to. 

@Chinmay J. Agree with the mortgage payoff. Leaning against this option, but the only reason I considered it is to reduce risk by moving the properties in a LLC. I can still retain some liquidity if a great deal came up by pulling out a HELOC - though that will be at a higher rate than what I'm paying now.

James - I have given it a little thought but it would have to be the right person/deal. It also seems a little bit harder to find. I probably need to go to some real estate networking events in this area to build some contacts, but would consider it if the right opportunity came up.

Thanks Caleb. I agree - maybe I need to adjust my expectations instead of comparing properties to my current rentals. I'm looking out of state but it's still been tough. 

Hello - just wanted to hear some opinions on what everyone would do right now with ~$150k. I've been looking for some buy and holds in the last year or so, but am having trouble finding something worthwhile. Two options I'm looking at are:

1) Payoff mortgage on 2 current rentals. One is currently a 30 year fixed at 4.25% and the other is a 15 year at 2.75%. Going this way would allow me to transfer the properties under a LLC (lowering risk, but minimal return - especially with the low interest rates).

2) Continue looking for multi-family properties while I leave the money in the market, investing in REITs and other Mutual Funds. 

I've been stuck in option 2 for the past few years, but am somewhat getting impatient/frustrated with not being able to find a good multi-family to invest in (would like something with a >9% CAP in a B class neighborhood).

Other notes: day job currently takes up a good amount of my time (so multiple smaller properties or any major rehabs are not preferred). Ultimate goal is to cash flow ~$15k to $20k a month in the next 10 to 15 years with rentals. Given that - what would you all do?

Thanks for the feedback. I’m thinking that as I grow, I’ll sell off my smaller buildings so that I can focus my time on the larger ones, so owning more than 20 or 30 separate buildings is probably out of the question. Even then, I may just group them together (by location or by value) in order to find a balance between costs and protection. We’ve looked at the series LLC and unfortunately they don’t have that in VA which is where we’d prefer to file. Also, from what I’ve read, it appears that it hasn’t been well tested since it’s a newer structure. I’ll probably still speak with an attorney before I pull the trigger, but good to hear some other opinions.

Hello All,

I had a couple questions regarding the best way structure and form the LLCs for my rental properties…….and some of the logistics behind it. I currently own 2 rental properties under my own name (w/ an umbrella insurance policy). My plan is to form an overarching holding company LLC and then place each of these properties as their own entity LLCs under that.

• Does it make any difference if I form the holding company before the individual LLCs to hold the properties?
• When I purchase future properties, would I purchase under the holding company and then move those properties into their own LLCs under that? When I look for commercial financing, I'd assume I could get better terms under the holding company (which would have a history of + income) rather than a newly formed LLC with no history.
• When I travel to look at properties out of state, or spend money on general real estate expenses not specific to any one property, would I just capture those under the holding company? If I didn’t form a holding company, how would I have captured these general expenses?

My goal is to maximize liability protection while allowing for the flexibility of a larger future portfolio. I would appreciate any advice you have. Thanks in advance!

Thanks for sharing your story @Joel Florek. One question I'm curious about - what was your rationale for paying cash on the 3 Unit and then pulling a LOC vs. putting 20% down and going with a traditional mortgage (w/ potentially a better rate)? Did you feel a cash offer and a short closing timeframe outweighed the cost of a slightly higher interest rate on the LOC? Or were you planning to own the property under a LLC and this was the easier route? Thanks again for the story.........definitely motivating!