All Forum Posts by: Josh Wallin

you are really overthinking this. Separate bank accounts for separate properties is a terrible, terrible idea. You should only have separate bank accounts when you have LLCs, and then you use accounts specific to the LLC. Please do not start thinking about LLCs because that is also unnecessary!

Your properties can - and should - share bank accounts, especially with only two rentals. You can use software or a spreadsheet to track what money belongs to each property. I don't even recommend software until you have 4-5 rentals.

You need two accounts: checking and savings. If the properties are split into more than one LLC, then each LLC will need its own accounts.

Checking: collect all income here, then use it to pay bills. Pay the mortgage. Pay for maintenance. If you are setting aside funds for capex, taxes, insurance, or other expenses that don't occur monthly, transfer those funds to Savings each month and hold them there until it's time to spend them. You will receive the security deposit in Checking but then transfer it to Savings.

Savings: Hold the deposit here so it's separate from operating funds. You can also hold money for maintenance, capex, taxes, insurance, or other projected expenses. When a tenant moves out, transfer the deposit back to Checking so it's ready to apply towards expenses or to refund to the Tenant.

If you end up with excess funds in the Checking account, I recommend you transfer it to a third account that is specifically designated for future investments. That ensures you don't spend it on other things and that you know exactly how much you have available to spend on the next purchase. If it's mixed in with your deposits and reserve funds, you may accidentally spend money you shouldn't have.

I would ask the lender. Some will do a drive by appraisal based mostly on comps and some will do a full appraisal. If they are doing a summary/drive by appraisal, let them know about the renovations and ask if you can get a full appraisal if you disagree with the summary valuation. 

Banks require appraisals. 

Curb appeal more important on STR than LTR. However, I prefer properties that don't need landscaping attention...has a higher likelihood of becoming a mess fast.

Ok @Josh Wallin, that sounds like a problem that needs to be corrected regardless. You don't want runoff pooling up against the foundation. That is a bad deal.

IMHO, it is more important that a STR have a cute exterior than a LTR. Doesn't have to be extraordinary, but should be above-average attractive for sure.....

Street appeal has a lot to do with initial impressions for both LTR and STR IMHO.

Some homes you just can't make real cute. What kind of grading issues are we talking about?