All Forum Posts by: Jeff V.

Elisabeth,

I would suggest following @Brandon Hall model.  Following his posts ect he used his bookkeeping/CPA knowledge to offer advice to those who needed it in the forums as well as providing content in the BP blog section.  Many people see his services as value added, get a sense of his abilities, get answers to accounting dilemmas and have then decided to become clients.  Just remember you must first give a value to the community and the clients will come from your efforts.

I also enjoy @Amanda Han's newsletters, they always seem to come at the right time and about a subject matter and always very educational.  They have good tips and advice for saving money on taxes and getting your books organized.

Either of these 2 would be good role models to follow in your chosen profession.  Also for transparency sake, I'm not in any way affiliated with either Brandon, or Amanda.  I just find their information very valuable to the community and believe they are doing a great job.

Just my 2 cents.

Hope this helps.

Jeff V

@Laura Costello

Looks like you already got some good advice on the full refi. I just thought I would share my recent experience as to why a HELOC might not be a good choice.

We use a LOC for the purchase and rehab phases of the BRRR process and the way they seem to work is, they are re-evaluated annually. During the re-evaluation process sometimes you don't have access to make additional draws ect. This ends up being alot of paperwork and could catch you in the middle of a rehab ect on the next deal or 3 deals down the line.

I could easily see how this could get overwhelming if you did HELOC for each Refinance phase. I would suggest having 1 HELOC for operating during the purchase and rehab phases, but always do a full refinance when pulling the money back out to pay off that one HELOC.

Granted this may not always be possible for the new investor being you have to have at least one property with sufficient equity to get the first HELOC up and running. The good news is annually you can add other properties equity to increase the HELOC by cross collateralizing the new properties. This would allow you to do larger and larger deals as your business grows.

Hope this helps.

Jeff V

Thanks @Chris Soignier

This question is to those accounting/bookkeepers out there.

Lets say I purchase a property for 30k and put another 30k in repairs/holding costs for an all in cost of 60k.  The property is now worth 110k and I'll be holding the property for a rental.

On my books I did the initial transaction:

Debit 30k - Property (Asset) and Credit 30k  - Cash (Asset)

Once renovations were made and the property put into service:

Journal Entry >> Credit 30k - Repairs and Debit 30k - Property

This zeroes out the renovations expenses and adds the costs to the value of the property.  The property now sits at 60k.

Finally going to refi the 60k back out:

Credit 60k MTG on Property - Liability and Debit 60k - Cash

My question is...  the property is actually worth $110k by appraisal.  How do I show this accurately on the books so that the company Net Worth is accurate as well as being able to use the $110k value when calculating my end of year depreciation amount?

I believe there is a step that I'm missing to reflect the true value of the property and possibly missing out on some depreciation in the process.  I believe my balance sheet should reflect an $110k Property in the ASSET column and 60k MTG in the Liability column to accurately reflect the 50k increase in Net Worth...  just not sure this is the case or not from an accounting perspective, nor how to actually record it properly.

This is a run down version of the accounting, but still fairly accurate...  hopefully it's enough information to be able to answer my question.  Also, if my CREDIT an DEBIT are backwards just chock it up to my inexperience with accounting and roll with it.

Please Advise,

Thanks

Jeff V

Robert,

The situation your describing sounds like you are seeking an asset based lender.  They use the collateral to determine whether to lend or not.  Now you did not say whether these are income producing homes, but that would come into play during the due diligence from the bank.

We were able to secure a HELOC on our properties in an LLC, but we had to personally sign using our W-2 incomes and personal credit, I'm not sure if that would have been possible for us with only a part time income from W-2.

You also may consider some local banks.  They have much less red tape and kind of operate on the good ole boy system where if they like and know you they will bend the rules to help you out.

Hope this Helps,

Jeff V

Check this out.

OBiTALK

I use the Obitalk100.  It allows me to have landline quality and plug into a regular cordless phone.  On the back end it uses Google Voice.  I have had no quality issues with it.  On the bright side when someone calls my GV number my cell phone also rings just in case I'm not in my office.  When I don't answer it goes to my Google Voice Mail and they transcribe the message and I get the MSG on my phone to listen to.

Works well and has the ability to use other VOIP services as well but GV is free :P  The device was like $35 bucks on ebay.

Jeff V

Joshua,

Welcome to the group.  

RDPD and Cashflow Quadrant are definitely good starts to getting yourself in the right mindset.

A few other good books are: 

Richest Man in Babylon which deals with personal finance and basic wealth building concepts which is the foundation upon which everything else is built. 

The Wealth Code and The Bankers Code are 2 books that fall in line right after RDPD and Cashflow Quadrant.  They both go into deeper concepts behind the formula for building wealth which indirectly applies to Real Estate.

Also this forum is full of information.  I would suggest reading through the Educational Guides for free on this site to fill in the gaps and get a good idea of which direction that you want to go for sure.  For example your bio says you want to be your own boss instead of working for others,  It may be a faster path doing flips than buy and hold to achieve those goals.  But you may not be willing to jump all in and want to build slowly.  Either way its better to have more information for deciding which path to take.

If you have any questions feel free to ask.  The community here is fairly generous at providing their experiences in different situations.  

Jeff V

Brian,

RDPD for many was the book that gave that original context shift to even be able to see anything other than the 9 to 5 lifestyle.  It's not that it provided top notch investing advice, it just allowed your knowledge glass to expand so that you could fit more content in.

His next book Casflow Quadrant had more detailed information that expands the knowledge glass once again and gives enough information to decide whether you wanted to be Employee, Self Employed, Business Owner or Investor.

Then his game Cashflow allows you to practice digging yourself out of the rat race using the broad concepts from the books.

They were never meant to provide THE blueprint for success.  They were meant to offer the average person a chance to alter their trajectory in life.  That's why people hold these books in such high regard.  In many cases this is in fact what spurred people to make a change in their mind and choose a different path.

I can see how if you are beyond that point in your life how they can be uninspiring and fall short of the hype that you expected.

Hope this helps to understand where people are coming from when giving reviews on this book.

On a side note, in college they said there are 3 buckets of information.  

Things you don't know you don't know, 

things you know that you don't know and 

things you know that you know.  

This book brings to light many things the average person "Don't know that they don't know" and moves them to the bucket of "Things they know they don't know"  This allows them to research and turn "Things they know they don't know" into "The things they know that they know".   Such is the journey in life, but this book is a big reason that many people get the first opportunity to start them on their path.

Jeff

Do Seller Financed loans  or private money loans count towards your 4 to 10 loan limit through conventional banks?

Jeff V

Ken,

I was watching some note videos last night and ran across Robert Young's website.  He owns a note servicing company and is an active note investor and broker in your area.  Not sure if he would help you out at all, but might be worth making contact with.

It seems some of his clients are Broker/Agent teams that specialize in having their clients offer seller financing for quick sale of their real estate.  I'm assuming he then services those loans and or brokers them to investors to end up paying off the original seller.

It seems that he might be a good source for seller originated notes in your area.  It also looks like he's a member of BP as well. Robert Young Profile

Cheers, I hope this helps.

Jeff V