All Forum Posts by: Morgan Klein

I wouldn't rule out renting to family or friends, so long as they meet the same criteria a typical applicant would...will they pay rent on time and take care of the property?  If so, there shouldn't be a problem.  It sounds like what you're asking, though, is how to break the news to a family member or friend that you don't want to rent your property to them, in which case I say honesty is the best policy.  Be up front why they don't meet your requirements.  

@Terry Burger @Graham Howell @Scott Duerk 

Following up on Terry’s comment, if y’all grab coffee sometime, I’d love to join in.  My wife and I started investing about a year and a half ago.  We have some SFRs in Jefferson, Georgia, but my wife is from Greenville (Simpsonville, specifically) and her family lives there.  We’re up there once every 4-5 weeks.  We’ve started to look at investing in the area, and would like to connect with some knowledgeable folks.  Please let me know if you have a meet up!

@Brian Bradley That is awesome information on the series LLC. I appreciate all the detailed insight from both you and @Scott Smith on this topic.  Thank you for sharing all your knowledge, I really appreciate it!

@Jerry W. No, I didn’t know that.  I feel like a should have, though.  Thanks for sharing that info, I’ll definitely look into those options more.

If this is an unexpected and large sum of money to your friend, I'd recommend they put it in the bank, don't touch it for at least 12 months, and spend that time becoming financially literate.  

@Calvin Lin Thanks for sharing!  That’s exactly what I have now, each unit with liability insurance (I believe for $1M, a little embarrassed I don’t know exactly) and then an umbrella for $3.5M.  

@Terrell Garren Since this isn't my primary job, I'm all about keeping it easy! I hope all's well in Concord, I went to App State and lived in Charlotte from ‘06 to ‘10. My REI "career" started in 2009 when I bought a short sale on Lake Norman and sold it a year later for a $50k profit.

@Kenneth Garrett Awesome, thanks for the podcast recommendation! I'll definitely check that out. I have all my properties in one LLC, but the series LLC sounds promising. I spoke to my attorney about it yesterday, but as you mention it's not available in Georgia. I'm going to study up on it further and possibly consider setting it up in another state, per @Scott Smith.  

Thanks for taking the time to reply guys, I really appreciate it!

@Scott Smith THANK YOU!  I’ve read several of your blogs over the last couple days as I try to figure this out.  Thanks for taking the time to share that info, I really appreciate it!

@Richard Sherman Thanks for that 2 cents!  I’ll definitely read the BAR on series LLCs.  From what little I’ve read it’s too soon to tell the extent of protections because of the lack of case law, I think that’s what you’re saying as well.

My LLC is in Georgia, the state I live in and have my properties in. Would you suggest rolling my current LLC into a series LLC in a different state? If so, any thoughts on how to best accomplish that? Thanks again!

@Thomas S. - Thanks for the reply, that makes sense.  My original goal when I got into real estate investing was to continually leverage properties for all the reasons you suggest, but I had no real end game in terms of how many properties I would try to acquire.  A couple years in, I’m realizing I don’t want to have a ton of properties, I’d rather have fewer properties (10-12) and increase my cash flow by paying down the mortgages.  That being said, do you have any recommendations on how to protect my RE investments if I were to pay down (or off) the mortgages?  I should add that I also carry a $3M umbrella policy.

@Carl Fischer Most of our retirement investments are in 401k, I'm probably not to the point where I could purchase a property (at least the type of properties I like to invest in) with my IRA. That said, I'm always open to new ideas and would love to learn more. Thanks!

@Brian Ploszay Thanks Brian, I do not believe series LLCs are permitted in Georgia. When you say small balance, how much are you referring to? I have about $165k invested in down payments, closing costs, and CapEx. The value of the properties is around $800k.

Hey BP - My wife and I started investing in real estate a little over two years ago. We currently have 4 SFRs in our portfolio. We both have good careers in sales (not real estate), with a combined 27 years of earning, saving, and cramming our 401k and IRA coffers. So we have a decent stash of personal assets.

This year I moved the properties into an LLC, primarily so I could separate our personal assets from our properties. Since then, we've made a commitment to increase our REI portfolio. Our 5 year plan includes paying off Our current properties and adding 4-5 additional properties. As the value of our portfolio goes up, so does my concern of risk associated with having all the properties in one LLC. So my question is, how much do you think is too much for one LLC? I set up two additional LLCs when I set up the one our properties are in, with the intention of having each property in its own LLC, before deciding I was ok with the risk of having them all in one LLC (and not wanting to deal with the additional paperwork). Any insight is appreciated!