All Forum Posts by: Erik Hanson

 If you are trying to find out who holds the mortgage make sure you check with the city or county to see who is listed on the deed of trust for the property.  Almost all mortgages are secured by one.  If he was a cash buyer you may have to hire a PI.

Erik

I wouldn't do that deal unless you had absolutely no other financing options. Hell I would even do a HML before what he is offering.

Here is one thing I have done that makes things easier.  I spent some time thinking about corporate structure prior to starting out.  Although I am technically the owner of my company I am also an employee.  I pay myself every 2 weeks using my corporate payroll service.  At the end of the year I get a W2 and my payroll company collects and submits all the appropriate taxes that I need.  Hell, I even pay into the state unemployment insurance trust for myself so If I have to lay myself off I can collect.  It makes things easier when you go to get financing because you can actually show W2s along with your tax returns.  Sets off less alarm bells.

Erik 

I think you will find a ton of different responses to this question because most people on here use their CPA for different things. I use my CPA for my both my full time business and my REI business and he get my book keeping, payroll, and tax prep business so I pay a monthly fee. The guy is a little expensive but VERY good and because I use him for a number of different products I do get a rather significant discount off his normal hourly rate.

Erik

Wandana,  While I am just a hobby LTR investor at the moment (not relying on my investments for income and rolling all cash flow back into purchasing new properties) I do have a piece of advice to help keep yourself motivated.

Reward Yourself - 

Keeping the end goal in mind is great but you need to give a little back to yourself before then as a tangible reminder of what you are working for.

Personally since my investment plan is very long term (not utilizing any cash flow for living expenses for another 10 years) I take 10% of the cash flow per month and put it in a savings account that I use for a family vacation.

it it a tangible reminder of what this money provides and it has also encouraged my son to take a more active interest in real estate investing because he sees how lucrative it can be.

Oh, and since the members of my family are also members of my LLC, we usually schedule a couple of afternoons of meetings so we can deduct the cost of the entire trip.

Erik

Just replaced 2 of them on my rental for the same reason.. $109 each at home depot and way less time trying to troubleshoot.

Erik

I would occupy it for a minimum of 2 years.  This way if you do put it as a rental you have 3 years to test the rental waters to see if its a good fit for you.  If it isn't you can sell the property and keep a good chunk (if not all) the equity in the property tax free.  As long as you have occupied a property for "2 of the previous 5 years" up to $250,000 for a single owner and $500,000 for a couple is exempt from capital gains taxes.

Erik

We are going to be organizing as either an LLC or sub S corp. We are primarily going to be doing business in Nevada and IL so the company will be organized in Nevada. I was looking for a little more detail though. I would really like to meet/talk to someone who has done this kind of an organization to help work through some of the pitfalls.

Erik

I have a group of about 10 friends/business associates that are all interested in getting into real estate investing.  We would like to invest as a group to increase our purchase power.   The nice thing is that we all make rather good income and would probably be able to buy at least one multi unit property every 6 months or so.  We plan on acquiring smaller multi unit properties initially and as we progress rolling them into larger multi family properties. Our goal is long term hold for retirement income purposes. Is there a good guide out there on how to organize a club like this? 

My rents are also due on the first of the month with a 5 day grace period.  Something I do that has worked for me is if the Tenant pays their rent before the first I give them a 25 dollar discount.  Since I introduced this policy I have only had one late payment (after the 5th of the month) most of the time my rents are in my pocket before the first.  To me having rent on time is worth the $300 bucks a year I am leaving on the table.