All Forum Posts by: Michael W.

The reason for me starting this discussion is because, I have been apart of this forum for over a year and some of the questions I had about the estimated costs of getting your first deal started, were never answered.

For example, Earnest Money ($2000), Inspection ($275), Appraisal($406), Closing cost($3000), having to put money into escrow for construction cost ($4000).

This is all for a hard money loan.

These are thing I am learning as I move forward.

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Originally posted by @Charlie Fitzgerald:

Depending on the lender you use for the HML it can be either. We do both. You have more asset protection in an LLC and we encourage entity set up for our borrowers. In Texas, you can do series LLC formations and they are even better. For your long term financing, an entity again will be preferred. Let me know if you need more help.

Thank you for the feedback. I plan to reach out to you soon.

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Originally posted by @Bob Green:

In regards to hard money, you can set it up either way, but when it comes to the refinancing into a long term debt program most portfolio lenders will require a LLC.

When refinancing I must go to a portfolio lender? If so will the lender be be using my personal credit & assets? This will be my first deal.

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Originally posted by @Andy Davey:

Definitely an LLC.

Thanks! Once I obtain the HML is the deed in my companies name or the HML Lender.

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When getting a HML would it be tied to my LLC or to me as an individual?

I have an LLC with a partner.

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Originally posted by @Santiago Chavez:

Hey Everyone,

I am on the state of mind of becoming a real estate investor, I really want to become an investor. I am currently going to school, seeking internship programs and reading books to help me learn the fundamentals and start getting a taste of real estate.

Welcome aboard!

On BP you can find answers to a lot of the questions you may have & the podcast are amazing.

Good Luck!

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Originally posted by @Percy N.:

@Brilliant Clayton- I believe it was

BP Podcast 109: You Will Get Sued. Here’s How To Survive with Attorney Scott Smith

http://www.biggerpockets.com/renewsblog/2015/02/12...

Great Podcast Thank you!

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Originally posted by @Gino Barbaro:

@Michael W.

Hi Michael

If you are going to form an LLC, it would be wise to place each investment into its own entity to protect one property from another. Unless you feel that the properties you are purchasing are not worth separating. People may tell you it is more costly because you have to file a tax return for each LLC, and their is extra bookkeeping and paperwork. Just remember, if one of your properties gets sued and the assets are all held together, then the entire portfolio is at risk. I think it is worth the extra expense to separate. Also, when you decide to sell a property, it will have its own bookkeeping and will be easier to show buyers the property performance

Goof Luck!

Gino

Good point, thank you for the feedback.

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Originally posted by @Marcia Maynard:

Yes. We did. Ten years without and ten years with. My husband and I currently maintain umbrella insurance, property insurance, and two LLCs (one is for REI properties we own with partners and the other is for REI properties we own by ourselves). Our tenants have always written their rent checks in our DBA name. However, on the rental agreement we use our LLC name with the DBA.

Good thing you are studying the pros and cons of different methods. Choose what works best for you at this time. Re-evaluate and adjust as needed.

Great Feedback! Thank you for sharing that.

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My wife & I are planning to purchase our first rental property next year.

I have read so many different things about LLC's vs Umbrella Insurance & I still haven't come up with a plan of action.

When leasing our properties I would prefer my tenants to pay thier rent to a enity and not me or my wife's name. Has anyone started out with a DBA and formed the LLC after they have obtained more properties down the road.

2 Votes

All Forum Posts by: Michael W.

Michael W. has started 4 posts and replied 12 times.

Post: Starting Out

Post: Hard Money Loan

Post: Hard Money Loan

Post: Hard Money Loan

Post: Hard Money Loan

Post: Future Real Estate Investor

Post: DBA for the Beginner Investor

Post: DBA for the Beginner Investor

Post: DBA for the Beginner Investor

Post: DBA for the Beginner Investor