All Forum Posts by: Alan A.

Hello BP.

Thanks in advance for taking time out of your day to consider my question.
I am trying to position myself to obtain financing for another rental property next year.
I currently have one rental property, of which I own 100% of the equity and is cash flowing well.

My problem is that I am self-employed. I recently quit my job to pursue REI full-time.
Despite the great gains in equity I have made this year (roughly 125k), my actual income (as to be used for filing taxes) is just under 30k.

I was told by a mortgage broker that being self-employed would require me to show 2 years of tax returns before qualifying for any financing. I will be filing taxes this week, and will need to wait for next year's taxes before meeting this requirement.

My question is this:
Should I consider paying MORE taxes (show higher income) in order to better position myself for better loan terms in the near future.

Many thanks!

@Steven Velez Yeah, replacing the A/C and having the ducts cleaned is something that looks more than likely at this point. By the way Steven, I am flipping in your backyard! Just submitted an offer in Pompano Beach. Thank you for your input.

@Travis West I doubt that it was caused by a leak though, seeing as how I could not locate any water spots on the ceiling. The unit appears to have been vacant for about 5 years. Hoping for the best, thank you very much!

Hello BP,

I am getting involved in FFF (Foreigner Funded Flipping), and am curious as to what my options are for structuring the deals. 

The ultimate goal is to avoid FIRPTA while still securing my investor's assets.
I was briefly told by an attorney over coffee that the best means would be to have him create an entity, and have the entity issue me a note/mortgage with a kicker on the resale covering the split. Before meeting with him for consultation, I was hoping I could gain some insight here first.

Has anyone had any experience with FFF?
Any thoughts on the what kind of entity to use and how to secure the deed?

NOTE: "FFF" is not actually an acronym in this usage, I was just trying to appear intelligent.

I had lines stapled around the baseboards in a rental.
I needed to install new floors and after removing the baseboards I noticed that it would be a pain to re-staple the lines. I ended up just cutting them and leaving the boxes dead and inactive. It was a lot easier than sheetrocking the holes.
You can also buy blank outlet covers to hide the holes instead of leaving the old phone jacks (they give an outdated impression).
They are very cheap and don't look bad at all, especially if they match the trim.

I put a floating tongue-and-groove bamboo floor in my first flip (a 2nd floor condo).
I also installed a click-system laminate in my rental unit for a third of the price of what I paid for bamboo. 

The bamboo looks nicer, but had a lot more issues (probably due to how it was installed).
When the wood started to shift naturally due to variations in temperature and humidity, cracks between joints started becoming more pronounced. I used A LOT of glue in the grooves, but it was happening. You won't ever have this problem with click-system laminate or engineered wood. You probably won't have this problem with non-click if you install correctly either, but click wood basically eliminates this entirely. It's just one less thing to worry about.

 If you are having it professionally installed by someone who knows what they are doing, I don't see there being a problem. But if you are trying to save money or DIY, or using labor that you're unfamiliar with, I would suggest using click floors. They are much easier, cheaper, and faster to install.

Also note that If you are installing flooring in a unit where there are people living under you, many associations will require cork soundproofing.

I would prefer to only use click wood in a rental or rehab just because of there being less chance of surprises and it being so much more convenient to install. In my own home, I would definitely prefer hardwood.

Hello BP,

I'm quite new to this, like the majority of others posting here, and would very much appreciate any advice or thoughts from you seasoned investors.

I am getting ready to pull the trigger on my 3rd flip.
First, the numbers:
1st floor unit (2 story building) >1000 sqft
Purchase: 28k
ARV: 110k
Estimated Rehab: 30-40k??
Rental (option): ~$1,100/month

I was a little surprised by the low asking price, and consequentially, am a little hesitant. It is not a large unit (under 1000 sqft) and has black mold throughout, in every room.

I am anticipating needing to have full mold remediation and replace all the drywall in the entire condo, including the ceiling. I've done a pretty extensive rehab before, but I've never done anything this large and certainly nothing with mold. I've called a few remediation companies and have estimated a worst-case scenario of 12k for remediation (before replacing the drywall)

My questions are as follows:
1) One remediation contractor mentioned that in some cases, the condo association might be liable and could file a claim with their insurance for the remediation expenses. He also mentioned that the drywall is actually owned by the association, not the homeowner, which was news to me. Is there any truth to this, has anyone had luck with this happening?

2) If the mold was caused by a leak, and if the leak resides between the 1st and 2nd unit, would the association also be liable here? I understand that if the source of the leak is in the above unit, that owner would be liable. Could I potentially run into problems relying on others to correct this problem, if it exists?

3) Will having to disclose the prior mold situation scare away potential buyers or hurt me on the resale?

Thank you in advance for taking the time out of your days to share your experience.