All Forum Posts by: Gina Shumway

How do you manage your bank accounts for your rentals? Do you have a separate account for each rental? I only have 2, but I was wondering how you track finances for all of them etc. 

Hello! I am under contract one a home that the utilities have been turned off. I am planning to flip this home so I know there are already problems. I was thinking of getting an inspection report before closing in case I missed any major problems before closing on a nightmare. That being said, I would like an inspection report WITH utilities on so I know what electrical, plumbing, etc. needs completed. How do you all navigate this? Thank you!

Quote from @Chris Tarpey:

Hi!

For our projects my partner and I have an LLC. This allows us to use hard money lenders or other investor loan products on our refinance deals. We are able to get 30 year mortgages as well with an LLC. This is how I would suggest you guys do this, especially when considering multiple deals.

I'm going to message you if that's ok 

Quote from @Nicholas L.:

@Gina Shumway OK. No offense intended... but I think it's pretty difficult to BRRRR right now. You really need everything to break your way - you have to find a great deal, you have to have contractors ready to go, materials prices are up and it's taking longer to get everything, and then you have to refi with the higher rates that are available. I just finished one myself and I got everything right except for the appraisal - it was low and so I "left money in the deal." And I was able to refi at 6.5% which I don't think is available anymore.

So, I get nervous when people who have never done a BRRRR before are using tons of leverage, which it sounds like you are.

Just my two cents.

I appreciate your input and would never take offense. I am very new. I guess I should have said I have 2 investors but am also putting in the equal amount of capital. I'm just using them to be able to pay cash. They have also agreed to let the funds roll over for years. 

We have decided to create an LLC and then go for DSCR loans. Thanks everyone! 

I know this is harder to do, but i will wait for the right deal. If I don't get 75% back or leave some money in the deal, it's ok. 

Quote from @Jacob Peace:

Hey Gina, at my company we work with over twenty different investors, and we offer free refinance for life!

 Then I will definitely be keeping in touch!! Thank you! 

Quote from @Nicholas L.:

@Gina Shumway

I am just curious, have you ever done a BRRRR before? Or will this be your very first one?

And, I am not an expert in any of what you're asking, but a lot of it is going to depend on whether your partners want equity in the property or not.  If not, and they're just looking for a return on their money, it's going to be simpler - you pay them back when you re-finance, and they go on their way.  But, if you are all going to own the property together, it's going to be more complicated.  These are questions for an attorney and CPA.

No. This will be my first time using BRRR method. I currently own 2 other rentals myself but the equity isn't not enough to finance another house at this time.

Instead of returning their money, I am offering a percent of equity/ownership in each property. Then, years from now, if they want out I will have to buy out their percentage based off the appraised value at that time. 

I am definitely going to contact both my CPA and attorney. I was just hoping to see how others did it. Thank you 

I am wanting to BRRR. I have 2 investors. May I ask the following:
How do I refinance with a 30 year mortgage with investors? I don't know if they would want to be on every loan (nor do the work).

Do I form an LLC with my investors, but then go get a conventional cash out re-fi myself?

And how do taxes work if I didn't form an LLC so we could get a conventional loan?

I hope this makes sense. I had planned on doing a joint venture or LLC but then was told i could not work with mortgage lenders and I would have to go through a bank. How do others do this?
Thank you for all your insight and help!

I am wanting to BRRR. I have 2 investors. May I ask the following:
How do I refinance with a 30 year mortgage with investors? I don't know if they would want to be on every loan (nor do the work). 

Do I form an LLC with my investors, but then go get a conventional cash out re-fi myself?

And how do taxes work if I didn't form an LLC so we could get a conventional loan?

I hope this makes sense. I had planned on doing a joint venture or LLC but then was told i could not work with mortgage lenders and I would have to go through a bank. How do others do this?
Thank you for all your insight and help!

I have decided to switch the the BRRR model. I have 2 investors who plan to do this with me for a minimum of 5 years. I have some questions how others have done this with the following:

Do I create an LLC to outline who owns what percentage of each house?

If I do, I have been told by lenders I cannot get a conventional cash out loan using an LLC. How have others done this?

Taxes: If I don't create an LLC, how do I make sure that I'm not paying taxes on the percentages owned by my investor?

For example: I own 60%, investors own 20% each. I don't want to pay 100% of the taxes owed on each property.

OF course I plan to consult with my attorney and accountant, I just wanted to see what those who employ the BRRR method do.

Thank you!!

I am also in Chattanooga TN. While I'm not the best person to answer this as i'm a newer investor, my understanding is that withdrawing from your retirement has to be paid back within 60 days for it to be tax free. Otherwise, it is taxable. Don't take my word for it, however, and contact your institution.