All Forum Posts by: Liz Lynn

Your state, if you were paying quarterly sales tax or B&O and the IRS are used to a schedule C or equivalent. RE rentals don't deal with sales tax or SE.

In addition, any past 'angry' customers will sue this LLC. Unlikely, but it's a risk. Plus the name is probably weird for RE, no? RE own and operate should be your purpose, not pet care.

@Liz Lynn the kicker is an LLC for a house is more a hindrance than a help. I only held commercial property inside LLCs.

Makes sense, thank you! I did not do sales or B&O tax, I did file schedule C though. No angry customers to worry about, but yeah the pet care theme is what I was not sure about. Would you mind explaining on how it's not so helpful?

0 Votes

Quote from @Mitchell Zoll:

Check the original filing documents of your LLC. You declared a "purpose" when you filed it. Most are a general statement of purpose such as "all lawful business.." If the purpose isn't limited and you are the only member, you should be good to operate your LLC for any business purpose - pet care, real estate, and even real estate for pets (very niche market). If you are getting into multiple properties as a real estate business, please visit with a CPA and a lawyer to come up with a game plan on how to arrange the LLCs. The most important step is to make sure you have a plan on how to operate the business that is specific to your situation.

Gotcha, thank you!!

0 Votes

Not sure if this is the right category, but I would like some input. I have an LLC from my pet care business that I recently closed. The accounts are empty yet still open and the LLC is still in good standing, so could I now use it for investing in properties rather than buying a separate LLC?. I want to know if buying an investment property under the LLC is a legal, good idea considering it is registered for pet care industry work. Furthermore, should I get a new LLC for each property? TIA

2 Votes

Quote from @Jim Reynante:

I can offer you some advice through my own personal experience and mistakes. The wholesaler can offer their connections, but you really want YOUR team involved because they are working for YOU and watching out for YOU.

Be careful when a wholesaler becomes too helpful and offers "a convenient turnkey solution".

Thank you! That is what I was thinking, but this is still my first deal, and I don't have a team set up yet. I'm going to do some research and get some quotes to compare. Do you have any advice on how to pick a contractor and/or lender?

0 Votes

San Antonio, Texas

Quote from @Kristi K.:

@Liz Lynn I agree with Greg. My warning bells are going off too. Like he said, get your own lender, use your own contractor. Drive in that neighborhood after dark.

Will do, thank you!

0 Votes

San Antonio, Texas

Quote from @Greg Scott:

My warning bells are going off.

Sometimes flippers build a team like this so they can charge you maximum price and an easy transaction for them. Read through this post.... https://www.biggerpockets.com/forums/48/topics/1151437-makin...

I would not do that deal unless I had my own contractor assess the repair cost. I would also want my own lender because the lender will want to ensure there is a correct appraisal.

Thank you! This is still my first deal, so I don't have a team set up yet. I'll do some research and get some quotes to compare. Do you have any advice on how to pick a contractor and/or lender?

0 Votes

San Antonio, Texas

Hi all! I am working on my first deal going through a local wholesaler company. They sent me a few deals and I found one I like the numbers on, and they have everything set up for me. They have connects for a lender, title company, and contactor crew. This is the summary info he sent me:

NEW VACANT OFF MARKET PROPERTY!! Tax assessed at 212k.

This is a really clean house off Fair Ave and 37 South. This house is solid for a flip or rental. The roof is in really good condition and the hvac works very well. We are only looking to service the hvac. We are set up as a 3/1 right now looking to convert to a 3/2, we have added additional funds for the frame out and adding in a 2nd bathroom. If you're looking to rent this property out, you will likely not need to do the addition to get great rents for this area. Renovation consists of updating the kitchen and bathroom with the installation of 1 bathroom. Buyer can close off one bedroom off the kitchen and make a huge walk-in closet with a bathroom in it to create a master suite. Also open the wall from the living room going into the kitchen and close off the sitting room to create the 3rd bedroom. No wall moves are necessary. The foundation feels good but the house is old so there are signs of settling in the house. We have a verbal of 3k on this house for foundation.
3/2 with conversion 1492 Sqft ARV 273K REHAB 32K PRICE 178.9K
RENTS SUPPORT 1900 PER MONTH

I haven't been able to walk the house yet due to my busy schedule, but I did get pics/vids and did a video call with the rep at the property. They said the crew can get it flipped in 4 weeks and I'm already pre-approved so I just need to provide the down payment to close at 170k. Am I in a good position or is this too good to be legit?

This is a slideshow I made for all the info too lol

https://docs.google.com/presentation/d/1kFxm9M8fNBoYtI93_Y_v...

0 Votes

San Antonio, Texas

Quote from @William Anderson:

Liz,

For your first investment, this house seems like a big ticket item. You may want to ask your agent if that agent has experience with investment property to look for something less costly. It's about mitigating risk. Starting Murphys Law may hit you in the face. Lower your risk going in. Of course, buy right, that house will not be the only one with potential. I have walked away from many potential buys because it was not quite right. I have rarely looked back because there is always another one on the horizon.

Congratulations on joining the club. It takes lots of imagination and initiative to get started and you have that.

Thank you! I definitely am trying to keep that in mind but the fomo is so strong haha. I will try to see about negotiating and wholesaling, but I do wish I already had the resources for this one 🥹

0 Votes

Quote from @Jim Pellerin:

Quote from @Liz Lynn:

Hi everyone! I am looking into a property that is very interesting to me and would love y'all's input. It's been on market for 90+ days but has been overpriced. It has been droppings 30-40k per month, but the sellers aren't in a rush to sell it and don't want to lower further (according to the agent). It has an acre of land with a 4b3b house (2 bathrooms are unfinished), a studio casita with an unfinished bathroom, an unfinished garage and 2 unfinished workshops. It was listed with the 2200 square footage of the house only, not including the extra 500 sq ft that was added for the extra bath and utility room nor the casita or extra garage/workshops. With that finished the house would have 2 living ares, 2 beds with insuite baths, and 2 that share the bath in the hallway. Everything is outdated so I would need to rehab the kitchen, flooring, and other bathroom as well. All electric and plumbing seems to be in line, the roof doesn't look bad, the HVAC is broke but the window units work, and the foundation is iffy. The listing says it's slab, but it's clearly pier and beam. I saw a small crack in the ceiling, and a few big ones on the outside.

So it looks like it will be a ton of work, but the ARV is looking to be higher up in 550k-700k because the area is great. It is in the medical center and it is in a fancier area of town. So I am thinking of a few different strategies. I could BRRRR it and get it fixed up while I live in it and then either sell or rent it out since the neighborhood is mostly rentals or open a dog boarding/daycare center (which is why I was looking at it originally), or I could wholesale it to a fixer upper. However, this is literally my first investment and I'm not sure if this is too much to take on as a beginner. I have been doing a lot of reading and watching youtubers, but I have been very nervous to actually get started bc of my lack of experience. I am working with a realtor who suggested getting a $350 inspection to see what all needs repairs, but I don't want to pay for it if it's not a good idea overall anyways. Thanks in advance y'all, I adore this community and please feel free to be blunt I really want some truthful advice.

If this is your first deal then I would wholesale it. There are a bunch of tools out there where you can lock down the ARV. Then apply the 70% rule and if you can get it for the recommended buying price/maximum allowable offer ( MAO), then it's a good deal for a flipper. Then just post it on the many FB groups in your area. Or find other wholesalers to jv with.

Thank you! I have had a harder time getting comps for the ARV because Texas is a non disclosure state for 1, and 2, the neighborhood is mostly owned long term and only a few have sold in the last 2 years. I think it will be a little unrealistic to shoot for an ARV based off if covid era pricing so I'm trying to figure out how to deal with that. If you have any suggestions or recommended tools I would love to hear them. Thank you again!!

0 Votes

All Forum Posts by: Liz Lynn

Liz Lynn has started 13 posts and replied 36 times.

Post: LLC Property Questions

Post: LLC Property Questions

Post: LLC Property Questions

Post: LLC Property Questions

Post: Too Good To Be True?

Post: Too Good To Be True?

Post: Too Good To Be True?

Post: Too Good To Be True?

Post: First investment.. Not sure how to proceed

Post: First investment.. Not sure how to proceed