All Forum Posts by: Jon Crosby

'Business' credit cards can usually only be provided to profitable, incorporated businesses if you are talking about a true non-recourse type of debt...meaning you would file bankruptcy under your business (not you) if you could not pay them back. 

What he is likely offering you is simply more credit cards under your business name but still secured by you personally. I'm confused on why you need to clean up your credit if you have an 820 score? Your DTI (debt to income) is what you should try and focus on if you are looking at using debt to acquire real estate. I mean, you can find a hard money lender for 10% debt service I bet.

Debt is a very powerful, but dangerous investment vehicle, please tread cautiously on whatever you decide to do.

Best of luck! 

Time is money so just because one is putting in capital, the other's time is capital as well so you will see a 50/50 split many times in this situation.  HOWEVER, that is usually when the operator (the person doing the legwork) has already established a track record of success.  When it's an unknown situation and the person doing the leg work is working to achieve that track record, then you can get better splits for the capital investor.  60/40 or more likely even an 80/20.

Additionally, you can look into a waterfall model (which is kind of complex) but it creates provisions that regulate the returns to the operating partner based on the success of the project.  

In the end, like with most real estate investing partnership...go with your gut and somebody you trust.  Verify references and always remember, there are other safer places you could possibly invest for a lower but nearly guaranteed rate of return. 

Best of luck!   

Always get a plumbing video inspection!  We purchased, put in 1200 square feet of wood flooring and then the sink started backing up after owning for a month. Tree roots created blockage, had to tear out flooring, jack hammer 16 inches into concrete slab to fix pipe and re-lay flooring.  Nightmare and lessons learned certainly.  :) 

@Vikram Deol. I'm NOT an attorney so take this as my 2 cents and you should seek professional counsel by a local attorney.  

As far as I know a dual signature contract is only legally binding when both parties sign it. Now that doesn't mean they couldn't take you to court and make a judge rule on if the contract is still in effect via arguments to whatever claim they might have but that would likely be very expensive for them and not worth it for a rental agreement.  As long as you still have the keys I believe you are still in control of the situation.  

Next time, don't sign until they do though or even better, let a property management company handle it for you until you get your feet wet. 

Best of luck! 

@Mary M.. You would be surprised how backed up electricians are right now, I would use Yelps' feature for requesting service/quotes.  You basically just go to Yelp, type Electrician and then there is this button you can click to request from multiple providers.  This will start a chat sessions with multiple options and you can figure out who would be the best fit to help you with your issue. 

Best of luck! 

Generally (at least in my limited experience) you cannot purchase a property in a 55+ community unless you are 55+.  So, you would possibly need to partner with somebody 55+ to put their name on deed to get the benefits of the deal. 

I think an electrician is the first person you should reach out to for this question.  Even if it's a $200 visit to assess for you that's going to save you a lot of time chasing your tail trying to figure it out, they probably have the tools and knowledge to tell you pretty quickly (like a circuit analyzer).  

Reach out to @Brian Suit and see what options he has for you!  He's awesome to work with.  

@Ian Palmer  Sounds like you have a good plan then, sorry I didn't mean to come off as if you weren't thinking of the neighbors at all either. ; )  

As for avoiding the bad apple neighbors I think the initial due diligence you did with the last house was a good start.  Additionally, you can look at AirDNA and see if you can spot any patterns (or clusters) of less then average reviews and then dig into if the neighbors were the cause listed in the reviews (like you did previously).

Or, use the map to look for neighborhoods that have more rentals than average as the neighbors may already be 'used' to having them there.  The neighborhoods where they are none, could likely be very resentful of the first one that comes in. 

I still wouldn't burn too much energy on it though as even your best assessment is likely going to be a rough guess either way.  It would be a shame if that last property was the perfect home and those reviews were strictly created more because of a bad host (which you could have corrected) versus crazy neighbors.   

Cheers!

@Ian Palmer  Congrats on your future acquisition first and foremost!  

I have owned and operated an STR in South Lake (Meyers/Paradise) and had neighbors around as well. Fortunately they were wonderful neighbors and therefor I made it my personal mission to make sure I was doing what I could for them so that my rental was not bothering them.

Remember, they were their first, they live there, there kids are growing up there and they are the ones that should not be harassed by loud noises coming from the rentals.  Obviously SLT has MAJOR issues going on with STRs right now because of so many owners/hosts not doing what they can to make sure they are renting to quality guests that are going to follow the rules or enforce any rules unless the county steps in...they simply wanted the revenue.

Before you spend too much time figuring out how to find the perfect neighbors (because I'm sorry to say it's likely impossible) I would focus on how you plan on operating your STR so that it creates and builds value for neighborhood and how you plan to make sure that it will not negatively impact their lives. If every host can or would do that more, then there wouldn't have been any reason for the STR restrictions to have occurred in the first place.

A few things I did along those lines were to personally reach out to each neighbor, introduce myself and my family. Let them know I was running a legal STR and planned to abide by all the rules of the county. I provided my phone number, email and a welcome invitation to contact me with any issues they had. I offered them discounted rates if they had friends and family in town and needed the extra space as well. I even had a mini-housewarming party and invited them all over to build that relationship. From that point on, my neighbors were my eyes and ears on the property, they informed me of guests violations sure, but they also informed me of the little things that friendly neighbors do, which I needed remotely managing, such as packages on steps, or fallen trees, etc. etc.

Anyway, sorry to drag on about this, I just think you might appreciate a different mindset going into this acquisition that might allow you to see more buying opportunities then obstacles. 

Best of luck to you!