All Forum Posts by: Mark Brown

Count me in also when the meetups start again.  League City area, investor-friendly real estate broker.

@Kandice Manciel. I’m a licensed real estate broker that originally got his license for investment purposes. What I’ve found is that I usually do so much research in looking for properties that I would exhaust your regular realtor. I like being able to search the mls for very specific parameters. The mls search engine allows a much mote find grained search capability than you get on Zillow or one of the other aggregators. The research allows me to find properties that I can make money on. Also it’s nice to save about 3% every time I purchase and sell a property because I pocket my own side of the commission. For me it’s worth it. But bring a broker, not an agent, also cuts down on a lot of costs on having a license since I’m not paying a desk fee or commission split to anyone.

The answer to this question is state dependent. If you haven't already, check with real estate brokerage laws to ensure that property managers are not regulated by the state. If they are, then the law might tell you how escrow accounts have to be handled.  Otherwise, what I've done before, is just get two bank accounts. One to collect all rents, pay the owners, take your management fees out of, and pay out repair costs, the other to put all the escrow funds like the security deposits.  Create a spreadsheet to track who all is owed money out of the escrow account. Note that if the bank charges a monthly fee for the escrow account, then you need to reimburse the escrow account periodically so your escrowed funds total up correctly.

Glad I don't live in PA.  Transfer tax?  Don't got that in Texas.  Best of luck finding a work around.

Most likely a lender would keep your name on the notes even if the property was in the name of the LLC. A lot of mainstream banks won't even lend to an LLC for a home. You can buy insurance to cover your liability risk. Make sure you have a separate bank account to run everything business through it. Get a separate credit card just for business expenses. Get a CPA. A CPA can vouch for your income which can be helpful down the road when you want bigger loans. But otherwise, don't complicate your life with more LLC's then you need.

@Leslie Mangrum. I’m set up with my bank for ach drafts. So I just automatically draft it out of their back accounts on the first business day of the month.

@Juan T. You definitely need a landlord policy because an insurance company might deny coverage on a homeowners policy because you don’t live there. But beware. Most “DP-1” landlord policies only cover about 10 things. It’s a named peril policy whereas homeowners covers everything that’s not explicitly excluded. Landlord policy only covers like 10 basic things, that’s it, and water damage (like from broken or leaking pipes, hvac issues, and water lines) is not one of them. but some carries let you buy this additional coverage. So you need to ask your agent to find you a landlord policy that includes an endorsement for water damages.

You can just tell them you need them to move out because you need to renovate the whole property, including their unit, and it's not practical for them to live there when you gut the place. Tell them you'll give them double their deposit on move out, plus free rent if they move out by a certain date. Basically, you're buying out their lease. People who have trouble paying their monthly rent would usually jump at the chance to have 30 days no rent plus a double refund of their deposit on move out. You'll come out smelling like a rose. Their kid will talk about the new stuff they are buying or something. Yeah it costs you a little bit of money, but it helps if they cooperate with you. It's a lot better than if they refuse to move, you give them 30 days notice, and then have to file an eviction when they overstay. And the money you spend buying them out can probably be deducted as a business expense on your taxes anyway.