All Forum Posts by: Michael S.

So I find this topic of interest, because I'm curious if this could be a significant advantage to keeping your real estate business in a completely separate LLC.

If you use your personal HELOC to make a capital contribution to your real estate LLC BEFORE you apply for a loan with your lender, I am unclear how they could claim it was a HELOC downpayment anymore, as legally you have made a capital contribution to your business, and your business has the right to do with the money as it pleases so to speak. As long as you book keep this correctly with your accountant, it really is no longer a HELOC contribution, because the money now belongs to the LLC. I am not a lawyer or CPA, but I am very familiar with LLCs and separate tax entities; I am not aware if there is a federal statue regarding how long the money must be in the LLC before it is recognized as the LLCs "own money" so to speak.

Good for you for starting your real estate investing at such a young age.  I'm impressed.  The last thing on my mind was buying real estate when I was in my early 20s. 

@Paul Evans - yes, but we only have single family homes;  I don't have any experience with multiplex properties, as this is a side business to my full time employment, so we are keeping it simple.  You are correct about Huntsville - the property value/rent/appreciation is very tightly correlated with zip code/location.  35801 and 35805 are right next to each other, yet the difference in properties is tremendous.  The market here is ridiculous right now compared to one year ago - cost per square foot is dramatically up. 

Property taxes are definitely reasonable compared to a lot of other states.