All Forum Posts by: Johnny George

Hello BP Community!

My sister and I are looking at potentially buying a small local neighborhood  market, which has a 2BR apartment above it.  I purchased my first investment property (single family home) a year ago, and it's going well, but I'm wondering how the process differs when targeting a commercial property with residential above it?  Are there things we should be aware of that maybe I wasn't as focused on when purchasing a residential property alone?  Obviously the condition of the market, and the costs associated with fixing it up are vital, but in terms of the buying process (i.e. pre-approval, loan, interest rates, etc) what should we be most aware and cautious of?   Also, are there initial steps we should be doing now to help this process flow smoothly?

Thanks for any and all help!

@Brian Person @Joseph Sangimino @Alex Deacon Thanks guys!  All very helpful insight on this... exactly what I was looking for.  We do have local property management in place, so we won't be managing from 3,000 miles away.  We do however, want to see how this first property performs before diving in deeper, but it's hard to turn away from a great deal.  One thing we've learned is that patience is key, so that won't be forgotten moving ahead.  Thanks again for the help!

My business partner and I just closed on our first Investment Property last week, a single family home for long term rental in Pittsburgh.  While we were in Pittsburgh (we both live in LA, but from Pittsburgh originally) we started looking at other properties and found a great multi-unit in a great area.  Having just closed on property #1 a week ago, and not even having a tenant yet, is pursuing a second property too ambitious a move this soon, and is it even possible to get another loan this quickly since we're only 1 property into this endeavor?   Thanks for any advice/insight on this!

@Andrew Postell Thanks for this info! Makes total sense, and I agree that they'd have little reason to trigger the Due On Sale if payments are being made on time. I haven't had a chance to read the Note yet, as our closing date is next Friday 6/9, and final loan documentation hasn't been made available to us as of yet. I will be sure to pay attention to that once we have the paperwork. How soon after closing would you suggest we start the process to transfer the title into an LLC? Since no payments have been made yet, nothing can be considered as "paid on time." I have no doubt that payments will be made on time as we stand to cash flow on this property, but is there a certain period of time that we should wait before we attempt to transfer the title into an LLC? And if so, what's our best course of action in the meantime, in terms of setting up a business bank account, etc? Should we operate under a DBA until we start the transfer process or is there a better way to handle this? Really appreciate your help!

My business partner and I are in escrow on our first investment property, in Pittsburgh. It's a single family home that we're gonna do long term rentals on. We close in about a week, but our biggest mistake was not getting an LLC set up early enough. The property is now in our personal names, rather than under the protection of an LLC. We did take out a $1 million umbrella policy for the property, as well as umbrella policies on our personal insurance as well, so we should be pretty well protected in the event of a lawsuit. My question is what do you all suggest we do in terms of a business entity, now that it's too late to have this property in an LLC? Transferring the property into the LLC will trigger the Due on Sale clause from the lender, and we'd have to pay a 4% transfer tax which seems like a waste of money. Do these umbrella policies provide us enough liability coverage if we were to operate this first long term rental under a DBA? I'm curious to know how we can operate this business without the LLC in place. Any suggestions are greatly appreciated!