All Forum Posts by: John Leake

When it comes to debt I always look at the potential returns, if the cost of the interest is low enough 3-4% and you can invest the extra money you would use towards paying down the debt for 5% plus then the money is better spent over the long run on the investment. Typically real estate returns get better the longer you own it through appreciation and rent raises. You also get some write offs through depreciation and expenses that can help offset your earned income which as a higher earner could have a really big impact for your tax bill form uncle Sam!

I typically like them on my leases if possible. I agree with everything said above

It's nice to have all your tenants on the same lease so you only have one lease to memorize and be familiar with. As far as meeting them I would sent a letter in advance of close if you have the property under contract and expect to close without issue. I include an introduction of who I am my contact info and ask them to reach out so we can set a time to meet. I like to have a sit down conversation with them and talk about any concerns they have as well as any deferred maintenance. This is your opportunity to show them who you are and set expectations. If you are putting them on your lease this is also a perfect time to do that and go through it with them. I use the Bigger Pocket's lease and have been very happy with it.

@Nathan Gesner@Nathan Gesner@Nathan Gesner

Really nice work! I've been wanting to do this for myself after having it come up so often in the podcasts. I hope you put it up somewhere where it can be seen everyday and that it has a really positive impact on your journey! What was the hardest part about putting it together?

A lot of time you end up being out less money overall doing "cash for keys" it can be worth the offer at least to see if you can shorten the turn-around time significantly. If its going to take a month for the eviction you'll likely be out a couple months rent. If they would take 1/2 the rent and be out in a few weeks you may be ready to rent again within a month and start turning the situation around. Sometimes, you just have to work through the process of an eviction. Regardless best of luck to you!

Typically if you live in a primary residence for long enough (2 years I think) you don't have to pay capital gains up to a few hundred thousand dollars @Mindy Jensen talks about this a bunch as one of her primary investment avenues. If you didn't live in it then it should be able to be considered an investment property. Once you talk to your tax person you should have a lot better idea as to what will work best for you.

Some general tax write off ideas:

Does your business need equipment that you can purchase and depreciate aggressively

Can you do Stock loss harvesting (Sell a stock you have at the loss take that as a write off to help offset gains 3,000 cap I believe) 

Repairs/ upgrades to existing real estate you choose to use as a write off all in the current year

Retirement accounts (you may also be able to contribute on behalf of kids)

If your due diligence supports the same numbers then the only question is if you could make a better return with that money elsewhere over the same time frame. Usually if a deal seems to good to be true it is.

Going along with @Will Fraser when I didn't feel I had the discipline to save in the beginning I set up a savings account with a direct deposit. It was out of the way enough, and out of sight enough that the money built up automatically. Eventually, I had enough to buy the motorcycle I was saving for at the time.

I would agree the fees are a bit rough on this one but also that you now have your first one under your belt, Congratulations! I would look for and talk to some local lenders. I've been really happy with CEFCU in my area. They are a credit union and have minimal fees. A lot has to do with the person I work with just being excellent at their job as well. I have not done a fix and flip loan with them but I have with another bank in the area. There were extra fees because of the draw process and the structure of the loan.

I agree with @Alex Roter I was able to pull my equity out with the same lender in a shorter time frame than I was given initially. You could also consider a HELOC depending on the amount you need for a second deal. If the deal in question makes sense I would go for it and focus on pulling your equity out when you are actually ready to do so.

I have always used an excel file that I created but this year I want to move to software that can do rent collection as well as help with the accounting. I think long term it will be a lot better for scaling the business.