All Forum Posts by: George Skidis

Harrison:

You are not asking the right questions, and your description is not very informative.

Rehab is dependent on the type of original construction. Your description could be a ranch style "National Home". These were manufactured with by sections in their factory and assembled on location.  Most wall panels were 4 feet long so the length and width are most often divisible by 4, These were very popular in the 50s and 60s and most are on a slab foundation. If that is true, the second bathroom may not be affordable or practical.

Your project could also be something with a full basement built in the 40s. If so that would make it easier to add a ground floor bathroom. But then you need to consider how old are the drain lines in the house and in the ground. Does it still have a septic system or has the city installed sewers. Next are concerns about foundation issues.

The older the house the older the plumbing. Is it copper or galvanized?  Re-pluming is expensive!

What you need to do is perform your own thorough and complete due diligence. Watch some rehab videos but stay away from "Flip this House" which is a reality TV Show filmed to create viewers and lean more to "This Old House".

The next thing is location. What is the max you have seen a home sell for in a 1-mile radius? Can you buy this home and rehab it to sell for less than the maximum price and still make a profit. 

Get three estimates for the work. Add 10 to 20 percent to the mid-range estimate to allow for the for unknown factors discovered after you start because you may not have the background to perform due diligence.

Go join the local Real Estate Investors Association (REIA) in your area. In Chicago go see Jane Garvey at the Chicago Creative Investors Association. IN Springfield check out the Springfield Area Landlords Association (SALA). In Southern Illinois check our Illinois REIA. We are all members of National REIA.

In Illinois, a series LLC lists all of your properties online with the Secretary of States Office under the same name. Have a problem with property #7 and the plaintiff attorney can go online and find everything you own.

I am not an attorney and do not play one on television. In my opinion it would be better to own each property in separate land trusts and have one LLC as a managing company. The LLC owns nothing but a check book. Each Land Trust is recorded separately. Harder to find your assets that way.

An LLC is only as good as your record keeping. Fail in one thing and you can lose everything owned by the LLC.

You need to do more research in your state, starting with "Charging Orders".

This is a dinner and networking meeting with a real estate topic discussion. Guest fee is $10.00 to attend and cost of meal.

The Garn Saint Germain Act (1984?) allows you to place real estate in a land trust for estate planning purposes and the bank will work with you. This also gives you privacy and avoids probate. Then your LLC leases the property from the trust with the right to sublet the property. You should actually set up a lease and print it. The LLC can then manage the property. If the LLC gets sued, it owns nothing but the contracts and a check book.

If the LLC is a single member, it is filed on your personal tax return. No asset protection there. A multimember LLC must be a separate income tax return. You can choose Partnership, S Corp or C-Corp.

Be careful when applying for a tax ID number for your LLC. If you indicate which entity you choose, then a tax return must be filed for that tax year. So apply for a C-Corp in Dec a return is due 4 months later.

My article in the forums indicates ho the State of Illinois just gutted the LLC asset protections.

Good Luck and Good Investing.

Join Jane Garvey's real estate club. She Runs the Chicago Creative Investors Association (CCIA). They just sponsored a Cash Flow 101 Game night and had great turnout.

Not aware of the exact circumstances.

Personally, I would never open a Series LLC in the State of Illinois. The series is a link for plaintiff attorneys to look up every property in the series. Get sued on one get sued on all.

Recently the Illinois legislature gutted most of the protections that made an LLC a desirable entity choice in Illinois.

As of January 1, 2025, several new Illinois laws have come into effect, impacting Limited Liability Companies (LLCs) in various ways. Key changes include:

1. Personal Liability of LLC Members and Managers

Senate Bill 2765 amends the Illinois Limited Liability Company Act to clarify that certain provisions do not limit the personal liability of LLC members or managers. This change emphasizes that under specific circumstances, courts may "pierce the corporate veil," holding individuals personally accountable for the company's debts and obligations. ilga.gov

2. Pay Transparency Requirements

House Bill 3129 mandates that employers with 15 or more employees, including LLCs, must include pay scales and benefits information in all job postings. This measure aims to promote transparency and equity in compensation practices. icpas.org

3. Personnel Records Access

House Bill 3763 expands the Illinois Personnel Records Review Act, requiring employers to provide employees with access to a broader range of personnel records upon request. Employers must comply within specified timeframes, and non-compliance may result in penalties. icpas.org

4. Pay Stub Record-Keeping and Access

Senate Bill 3208 obligates employers to furnish employees with copies of their pay stubs within 21 calendar days of a request, up to twice in any 12-month period. This requirement applies even after an employee's separation from the company. icpas.org

5. Restrictions on Mandatory Meetings

The Worker Freedom of Speech Act prohibits employers from requiring employees to attend meetings that communicate the employer's stance on political or religious matters. Retaliation against employees who decline to participate in such meetings is also forbidden. knowledge.dlapiper.com

6. Employment Verification Procedures

Senate Bill 508 prevents employers from imposing work authorization verification requirements beyond those mandated by federal law. It also prohibits adverse actions against employees based solely on the receipt of a notification regarding work authorization discrepancies. icpas.org

LLCs operating in Illinois should review and, if necessary, update their policies and procedures to ensure compliance with these new regulations.

The above is an excerpt from the Illinois REIA Saturday Summary.

Personally, I would never open a Series LLC in the State of Illinois. The series is a link for plaintiff attorneys to look up every property in the series. Get sued on one get sued on all.

Recently the Illinois legislature gutted most of the protections that made an LLC a desirable entity choice in Illinois.

As of January 1, 2025, several new Illinois laws have come into effect, impacting Limited Liability Companies (LLCs) in various ways. Key changes include:

1. Personal Liability of LLC Members and Managers

Senate Bill 2765 amends the Illinois Limited Liability Company Act to clarify that certain provisions do not limit the personal liability of LLC members or managers. This change emphasizes that under specific circumstances, courts may "pierce the corporate veil," holding individuals personally accountable for the company's debts and obligations. ilga.gov

2. Pay Transparency Requirements

House Bill 3129 mandates that employers with 15 or more employees, including LLCs, must include pay scales and benefits information in all job postings. This measure aims to promote transparency and equity in compensation practices. icpas.org

3. Personnel Records Access

House Bill 3763 expands the Illinois Personnel Records Review Act, requiring employers to provide employees with access to a broader range of personnel records upon request. Employers must comply within specified timeframes, and non-compliance may result in penalties. icpas.org

4. Pay Stub Record-Keeping and Access

Senate Bill 3208 obligates employers to furnish employees with copies of their pay stubs within 21 calendar days of a request, up to twice in any 12-month period. This requirement applies even after an employee's separation from the company. icpas.org

5. Restrictions on Mandatory Meetings

The Worker Freedom of Speech Act prohibits employers from requiring employees to attend meetings that communicate the employer's stance on political or religious matters. Retaliation against employees who decline to participate in such meetings is also forbidden. knowledge.dlapiper.com

6. Employment Verification Procedures

Senate Bill 508 prevents employers from imposing work authorization verification requirements beyond those mandated by federal law. It also prohibits adverse actions against employees based solely on the receipt of a notification regarding work authorization discrepancies. icpas.org

LLCs operating in Illinois should review and, if necessary, update their policies and procedures to ensure compliance with these new regulations.

The above is an excerpt for the Illinois REIA newsletter of 22 Feb 25

The first thing to do is get the permission of the existing mortgage company. If your deal is built on secrecy and concealment, what are you scared of?

If you move title to the property into a trust for the seller's "Estate Planning purposes", you still need the mortgage company's approval. 

Any effort to avoid dealing with the mortgage holder is fraud. The key point here is that the seller is selling not planning their estate. Any telephone conversations, correspondence submitted via US mail fall into the categories of wire fraud and mail fraud.

Without the permission of the mortgage company there is no way to legally do this. There are a few illegal ways but that is the wrong way to get into this business.

I have heard all the arguments about how the mortgage company doesn't care who writes the check as long as they receive it. That may be true. But there will always be that one company that will prosecute you.

Insurance for 1-4 families is reasonable. Insurance for a 10plex will be higher.

How many bedrooms or bathrooms in each unit?

Is it all on one level or a two story?

If a single level you might consider 55+ independent living. If that works you may end up with tenants who stay longer and fewer vacancies.