All Forum Posts by: Wilson Lee

@Joe Splitrock  The foundation is cracked, Some pluming was knocked loose. both the walls it hit where load bearing. Floor joist are cracked, That wall also had electrical in it. Not that electrical is open, All electrical in the house must be upgraded to code.  Which means ripping open all the drywall. Debris damaged the kitchen and all of the appliances.

The claims adjuster has been to the house.  they said it can take 3 weeks before they have results back.

I don't know how to start. hum, A drunk driver drove their SUV in to the living room/dinning room of my rental unit. The damage is about $45,000-60,000 I got the house for $20,200 and put $15,000 into the house. My insurance maxes out at $70,000 for the dwelling and 7K for lost income. They will also pay up to 7K for upgrades do to Ordinances/law meaning the cost to bring stuff up to code. We are still exploring the extent the driver's insurance. My delectable is $1,000 we have a HELOC for $30,000 on the house, 25K is took out.

This is my first insurance loss on a house.  What do we look out for?  What are the options? What should I do next? 

That gets messy.  Normally your current entity would be the owner of the 2nd entity,  the 2nd entity being the one who owns the real-estate. But, S-corps can't be owned by other companies. 

Can your from a S-corp. Move your share of your current partnership LLC to the S-corp as a parent company. then, form your new company as a LLC owned by the parent S-corp? This sounds like a job for your CPA and attorney to hammer out.

Owner occupied multi-family.

Why? Easy on ramp.  We where in our early 20's with new jobs. We had a negative net-worth from student loan debt. It was the best option for us. 

When I looked for a HELOC we spoke to many banks before finding the right fit. It took about 20 working hours.

When you find the bank for your, keep them happy.  We used a regional bank.

Flipping in high cost markets is sometimes your only option.

But if you want rentals, You will need a cheaper market. Only if you knew some one in a cheaper market..  Like Birmingham AL. 

But really, Your market is costly.  There are many other places to invest in.  Read up on out of state investing.

Well, in 2017 you where a 1099 contractor, but you JUST NOW got a new job with a company who is giving you pay check stubs and are now a W2 employee! congrats! Your new job is with the S-corp you just formed.

A few months as an employee should do the trick.  You can even get a letter from your new employer verifying that your employment will continue.

Yea, my check list is called Jason, my contractor.  He shows up and gets the work if I buy it (contracted). It also makes him feel like part of the team.  It keeps him on budget when he put out his recommendation first.   He is more willing to flex on his own prices when rehab goes sideways.  He knows there is more work down the road. Keeping me in business is good for his business. It is win / win.  

Get a contractor.  

You are good.  They are giving up equity and you have 20% down.   Refinance as soon as you can.  You can try in 6 months, seasoning, but if you don't have rental income on your tax returns some banks may make a fuss.  You can also refi next year after you report the rental income on your taxes.

Some things to include.

Still pay for your own appraisal and have a appraisal contingency in the purchase agreement. They they push back. I would question why they are avoiding an appraisal.  You need to know if you can refi and not have to sink more cash in to the project down the line.

You can ask for interest only payments if they are asking for a balloon.  fair is fair. 

Yea, A nice round $2000 bill seems like a made up number. It seems like they wanted to make $2000 and came up with some work to do that fits the bill.

I am in a very different market. So your cost could be higher.

Exterior painting cost way more than $150. So this must be just trim or something small.

$225 for house cleaning??  I paid $125 a few weeks ago.

$250 to remove debris is excessive. should be included in the landscaping / house cleaning charge.

$495 for paint touch up?  New paint is about $2 per sqft.  So $1500.  For their price to work they should be painting 1/3 of the interior.

It may benefit you to shop around.