All Forum Posts by: Liam Goble

Last month I was quoted 4.7% on a commercial loan for up to $100k (20% down). Your rates seem high.

The only red flag I see is the 10% down. That may trigger a higher rate. You should ask about that one.

@Christine Glasner Welcome to BP. I started investing in 2012 and struggled to find like-minded people until I stumbled across BP. Now I actually feel I have a place in this world!

I started my first flip last month. It's been a crazy ride so far, but now I've got a good contractor who is working at a good clip and doing excellent work. I would encourage you to read through many of the posts here on BP regarding flips as there is a wealth of information available (for free) to help you.

Good luck with your REI activities.

Hey CL. I own my properties in an LLC. There are pros and cons of LLCs:

Cons: Need insurance (including umbrella policy)
You are restricted to commercial financing; for me that is 5-5-5 ARMs (total mortgage due in 15 years max)
You file two tax returns (1 LLC, 1 Personal)

Pros: Depending on your state, an LLC offers protection to the assets outside of the LLC
LLCs are pass-through tax entities, meaning that any taxes pass through to your personal tax returns. (So the business is only taxed once)
To make sure LLCs are as strong as possible, you'll have separate bank accounts, credit cards, etc.

Even though I currently own all of my properties in an LLC, I am considering purchasing a few personally so I can get 30 year financing at low rates. If I do that, I plan to open a separate checking account so my real personal finances are separated from my personal real estate finances. That will help everything at tax time.

I was able to secure private funding at 100% for 50% of the profits at 5% interest-only payments. If you connect with the right private lenders, you can find good lending.

This is probably a real newb question, but how are you finding filterable lists? Are you creating the lists yourself, looking up the information, then sorting?

Thanks.

@Jon Klaus We're taking your "Forego the expense" path for the next five years to develop a strong cash river.

I've found that, after the hard numbers, REI is simply a mental game.

I'm a contractor in PA and we deal with wet basements on occasion. What you want to do is reduce bulk water buildup against the foundation. I would approach either a foundation company, or a GC with experience (he will use an excavation company and other labor to deal with the issue.

I've had good luck in the past with a few solutions:

1) First and foremost, make sure there is a swale about 5' out from the house to divert water around the house

2) Make sure there is some sort of foundation drain system which daylights (on the downhill side of the house)

3) Make sure there is some sort of capillary break system on the exterior of the house (Delta Dry, crushed 2b stone, etc; DO NOT rely on drylock or any of the cementatious based coatings)

Even the short term doesn't have to be a sacrifice. By adjusting your point of view, you can dramatically increase your satisfaction in life while simultaneously building your REI portfolio.

How many landlords have walked into their resident's places only to find 60" flat screen TVs with a really nice sound system while the landlord's old 27" CRT TV (w/ no sound system) is sitting at home? How about the relatively new car (3years or younger) in the tenant's driveway while the landlord is driving a 10+year old car.

Who is happier? Who is to say, except I don't want to have to work 40+hours per week so I can have a 'new' car in the driveway (BTW, the car gets older as the years tick by). Why own a huge TV if you have to spend most of your waking hours working to afford the TV?

I get much more satisfaction from life with the 27" CRT and 2005 model year car but $1,050/month cash flow from my five units. $12,000/year can afford a pretty sweet vacation (even if I do have to take 'unpaid' time off from my day job). I would prefer a 4-week road trip across the US, or 2 weeks in the USVIs to a 60" flat screen.

I concur with @Levi F. . The first few winners are key. Even at 5 units, it still seems like a slog at times, but each month is getting better. The REI skids are getting greased as the months roll by.

Be aware of your own personal limits, the human mind is feeble - track everything on spread sheets, trust the numbers and don't try to get 'creative' with the numbers.

I started by purchasing my properties in an LLC, so I was always subject to commercial financing. I'm planning to add a few non-LLC purchased to take advantage of some low rates for 30 years.

The model is scale-able, it does work, it just takes time and persistence to find the right properties.

The last point I would have is that you need to have repair reserves, I estimate 10% of gross, saved per month in case of problems. Don't think your units will be immune to problems. As a newbie, I was beginning to have dreams of non-problem units until this past month, when my units reverted to the mean (and I was glad to have the pot of repair reserve cash sitting around).