All Forum Posts by: Nate Wong

The contractor Is Licenced and the work with permit. However the city inspector would not go under the crawlspce to inspect the work. I want to make sure the contractor not cutting corner and the work performed up to code.

Does the LLC protect the seller from non-disclosures?
Recently my investor friend being for water intrusion to the garage which he has no knowalege of.

I just talked to the contractor, he will redo the electric work to drill through the joists with romex plastic electrical wires.

I am still confused why would investor flipping properties with LLC if it does not offer much benefits. Using own personal name sounds like even better for a part time investor like me flipping one or two properties a year? As for the home warranty, it does not cover many of the items such as water intrusion, foundation movement, rotted wood inside stucco. Am I right? those are the most important issue being sued by buyers.

I am new to real estate. it is my first flip project. I have two questions hoping you as experienced investors could point me to right direction.

1) I just talked to several real estate attorney and accountants. I have been told that LLC will not have much benefits as I was thinking it would. Attorney said it would mainly protect from Debt or general liability, not much from any issues which the buyer would sue after closing such as non-disclosure or home defects. I mainly concern about being sued after I sold the properties due to I am a newbie and does not know much about construction. He suggested I bought a better insurance instead of forming an LLC.
The CPAs I talked to mentioned it would not offer benefit with LLC due to it needs to be maintained paying $800 fee plus a tax of percentage of "Gross sale"(in this case total dollar amount of the property sold for, not profit I made on the sale), he said it's roughly $2500 for $500k property. This is the additional Tax only for California on top on the state tax.

2)on my current project, the contractor putting new electric wires at the crawlspace. However he didn't drill holes to run the wires through. instead he running wires at the bottom of the joists. Is it up to code or does it need to run through the joist with some holes?