All Forum Posts by: Nelson Leal

@Anniqua Brooks than you and good luck to you as well.

@Kendric Ng biggest thing I would say for out of state investing is be prepared for unknown local, state costs that seem to pop up.  Living in one state you know all the costs but each time I buy a property in a new area there always seems to be added costs that come out of no where.  City tax, county tax, renting registration, property maintenance, etc the list goes on and on.  Those have been the biggest things.  Of course the are bigger, costlier items that come up but it's the norm for in-state our out of state investing.  

@Remington Lyman   Lyndhurst, OH

@remington lyman   Lyndhurst, OH

FYI.....just posted this property on the marketplace.  Not sure if it's allowed to share that info on these forums but technicly it's part of the "diary, log" which is the point of this whole post.  :)

https://www.biggerpockets.com/real-estate-listings/turnkey-rental-kch7ll

Wow, it is awesome to go back and read the log of a property.  3 years later, I have the same tennent in the property.  Paid late by a day once the whole time they have been great.  No major issues, couple of minor cheap and easy fixes.  This property has cashed flow month in month out, it has been awesome.  Now looking to cash out possibly along with the Ohio property I bought right after this one.  Been one of the best purchases I have ever made!

Thank you gentlemen.  Only quirk at this point is having to wait with the whole no eviction process.  most of my leases are month to month with 1 of them being annual.  On month to month I believe I could just claim not to "renew" and get away with that.  Will have to see unless you all know the answer to that one already.  

Hello out there,

Been a while since my last post when I was snatching up some out of state rentals. Did a great job, got lucky and now I have 3 properties that I'm considering selling from my portfolio. I get emails, calls, texts, mailers, etc all the time for these properties for years. Now, I'm thinking it's time to unload them and buy bigger. The kicker, I'd like to sell them all in one shot. It would be my first time doing a 1031 and don't want to attempt to sell 3 properties to 3 people and roll that into 1 1031 buy. The timing to do all of that and being a newbie doesn't give me confidence. However, selling all 3 to one buyer, I can roll with that.

So, to get that done I know I'll have to sell to an investor and not an end users. Less money, however that's the trade off I'm good with it. Question is....what's the best way to go about that. Bigger pockets, local network, some other site, group, something I'm not thinking of to find those type of buyers? Any advise would be great. I've done a good job of buying, properties that are either great cashflow or great on equity ready to flip.....problem is I've never done well selling to end users, thus being open to taking less and selling to investors.

Thoughts?

@Ashley Lynn   Lots of advice out here to be had just be careful what you take in from others.  your question is difficult to answer.  Others have already have but with solutions that would best fit them.  You stated to buy another primary would be a step down, seems that is a major concern for you and it should.  Do you have family that would be moving with you?  Little ones to be concerned for the school district?  By yourself and neighborhood safety a concern?  these are all factors that come into play and did with me when I cashed out last year on my 1 rental property.

I tried to find a 2-4 unit and house hack but when it came down to it was too much down $$ to buy here in south florida and all those properties, at least for me, weren't in areas I was willing to put my wife and two kids in. So, there went the idea of house hacking, should have done it in my earlier years.  

Yes, financially many times it makes sense to buy and move into a new primary as rates and terms are better.  Sometimes it's best to stay put, don't incur moving expenditures and hassles and buy rental/flips.  That's what I ended up doing and went out of state to do it.  Took a cash out refi for 45k mid year 2017, bought 2 rentals and just went under contract last week for a 3rd.  Not saying this is best for you but another option to think about.  

What others have put are all good suggestions you just need to figure out what is best for your situation.  Good luck and we are all here to help out.

@Jon Huber I've been trying for so long to go to one of those meet ups and something always comes up with kids, work, home, etc.  No more excuses I have to make it out there this weekend can you send me an invite to it I don't remember seeing the one for this month.  Thank you Jon.  

hello,

I'm about to do the same loan from 401k on my next project for the first time. I would think it all has to do with your plan of action. Is it a buy and hold, BRRR or flip? As I have not done this yet I don't know all the details but one would think:

1. Buy and hold............isn't the loan an expense therefore you can write off the 5-6% interest your paying yourself back therefore providing a tax advantage.  But then again if you claim that as an expense i guess you have to also claim it as profit since your paying it to yourself so that might end up a wash but maybe not because it's going into a 401k and not you another post-tax account.  Also remember, your tenant is paying the loan back not you, hopefully, so that's a positive.  

2. BRRRR.......your refinancing in 6 months cash out so you can immediately pay back your loan to get your 401k back to what it was in a short time. Again able to write down the loan interest portion as tax deductible, maybe?

3. Flip................you can pay back the loan even quicker and not loose much time of earnings in your 401k.

Of course factors like fees for the loans, fees for the selling and buying of your 401k allocations, etc come into play.  Not to mention the current rate of return differences in your earning of the 401k compared to your funded Real estate deal. 

To me the most important item you can't necessarily put a price on is time and education.  Pull the loan, flip a house, make money.  You now have more money than you did before and you gained the knowledge of another transaction.  who knows, maybe that transactions leads you to another or meeting someone who helps you along the way of creating more wealth.  You can't predict the possible end results on that.  To me that's where the value of this loan comes in: it will help me do added deals now and we all know the more deals you do the more deals present themselves to you.  

If someone could answer whether or not you can write off as a tax deduction the interest portion of your loan payment that would be appreciated.  thank you.  

@Joel Ortiz the wholesaler I bought the property from referred me to some contractors and the one they use as well. I ended up using their contractor. Had some hiccups but when isn't there. Worked out well did a second property with them in Ohio same kind of deal with contractor there as well. Took a hiatus from REI for a bit back in now looking for next property. Good luck on your ventures.