All Forum Posts by: Mitchell Krotz

 Who is that directed towards?

If me then yes, I have a couple properties I have worked on or in the process of. 

Yes, would love any additional information. I did go online and read about DSCR ground up loans, so I know they are out there.

Thanks for the reply

Looking into DSCR loans for a new build that I wish to make an Airbnb.

Besides looking at what Airbnb comps are pulling in, backup would be what long terms are pulling in and average selling cost of what the home will be when finished.. anything else I should be plopping at? Anyone with some background in this? Perhaps thinking of a  modular style home to get it up and running quickly. Any thoughts?! First time looking into this so any references our resources will be appreciated. 

Everything is booked and excited to be going for my first time! Is everyone pretty much staying at the hotel the conference is at? 

Where have people had success selling land? What platforms/social media's have people used in the past??? Any and all feedback would be appreciated! 

During my 8-5 job I started to let my mind wonder on a potential idea. I am not sure if it’s original, if I have heard it somewhere, if it’s a good idea or some crazy idea that wouldn't work. So I figured why not post it and see what people’s reactions are and possibly get some questions answered.

I know a big problem people have with real estate is the money portion... The down payment/purchase, renovation cost and so on. So has anyone paid with equity of the very property they are working with? Here is the proposed concept…

Let’s say I am a founder of a company... lets call it "Equity Rental USA" and sole owner of it as well. I then go around buying up properties that need all different types of work. Some could be major rehabs, others could be paint, new carpet finish and so on. Let the imagination run wild with this. You walk each property as you purchase and determine (with accuracy) what SOW would need to be completed. You then have a list of tradespeople... electrician, plumbing, carpenter, window guy, tile guy, painter and so on. You bring each trade in and discuss the SOW required to have the house up and ready for either rent, or sale. Based off of the amount of SOW, an equity amount is agreed-upon.

You create a separate LLC for each house. Each trade that has SOW owns a % of that LLC (whatever was agreed upon). All funds for that property could then run through that LLC... Short term rental, long term, maybe even just a quick sell.

So let's say example 1 has lots of electrical work, new windows, new tile and paint. That's ALL the SOW that was required. You divide up the new "EXAMPLE 1 HOUSE LLC" that ONLY has that one house as the following

"Equity Rental USA" owns 51%, Electrical person 25%, Window guy 10%, tile guy 9% and paint 5%.

Once it is finished they are now part owner of a LLC (therefore that house). They are getting all the benefits of having part ownership, they more than likely will have more pride in their work because it is something they own and there is no out of pocket money for the rehab for the owner of "Equity Rental USA".

I am sure there are many issues with this as there are positives but I wanted to post it and see what people thoughts are on the concept. Please speak your mind and let me know if you have ran across anyone who has done something like this or know anybody (especially the skilled laborer's) that might be interested...

Thank You!

Hello All!

So I have my first full time rental property now up and running and I have a few questions on how people have handled their finances. I created 2 LLC's. One specifically for the house, and another (the unbrella LLC) for protection reasons. The house will need to be "slid" over to the LLC specifically for this house and out of my name here in the near future. However, I have money coming in now. I want to open a checking account to put my first check in. My goal is to start things off the proper way and obviously keep this income separated from my personal.

I have an EIN number for my Umbrella LLC. Not the specific LLC that was created specifically for this house .

Question 1:  Where do I put this money? I am wanting it in a checking account to draw expenses out and keep everything separate and protected.  

Question 2: Do I need an EIN number for each specific property with separate checking accounts? (if I plan on opening a separate "sub" LLC for each property which would all fall under my main umbrella LLC)? Or should all my money go into one account for my main LLC.

Question 3: The house is NOT under the LLC yet. That will be done in the next several upcoming months. Until then, should I open a checking account under one of the LLC's (depending on the response from Q2). Or should I just temporarily open a personal account under my name and put ONLY the rental income money from that in the account and make changes later...

Thanks for any input!

Mitch

Greg,

Thank you so much. I will look more into the Fannie Mae Home Style Reno that you have mentioned... Does this require certain contractors like the FHA 203K or does it give more opportunities for who you hire out?

Hello,

I am looking into refinancing my house into a 203k loan so I can complete the rest of the work I would like done on my house all financed through my mortgage payments. I do not have enough equity yet built up in it to lake out a HELOC. Has anyone used this process? Looking for who they used for a refinance and if there are any contractors they would recommend. The house is in the Hilliard area!

Thanks!

Absolutely!

Look at it as free money.  If you had any type of investment that gave you 133% return you would take it in a heart beat... That essentially what this is.