All Forum Posts by: Nicholas W.

I guess one thing to consider is if you had inherited $450k would you have taken that and invested in 14 units in the Indiana market? If you have to opportunity to sell and you chose not to you are essentially buying that asset (those assets) for that price.

I agree with Josh. The best thing you can do is never pay a single business expense out of your personal funds. You can invest and draw in and out of the LLC as much as you want but always pay for the business expenses from the LLC account and more importantly never pay for a personal expense with the LLC account. For both the closing costs and the roof, just transfer the money to the LLC account and pay for them.

When I did my own kitchen a few years back I put in 30's because I thought the area behind the soffit was unfinished and unusable. After ripping everything apart I found that it was plastered back there and everything. I removed the soffit and kept the 30's because they were special ordered and I wanted my kitchen back. In hindsight I wish I had put in 42's because the added storage would be useful, not necessarily for every day things but for occasionally used items. I honestly think it looks better with the 30's, crown molding and an open top for knick knacks than it would with 42's but I still would like the extra storage.

I guess my advice would be that if storage is plentiful don't sweat it but if there aren't many cabinets to begin with then go with 42's.

Jeff, thank you for the response. It prompted some additional research into the law and I found the following.

My understanding is that anything collected with the application above and beyond the $20 would be considered an earnest money deposit which entails an entirely different set of hoops to jump through.

So I am doing some research as I purchase my first rental property and wanted to get your opinion on using Smart Move for tenant screening since I know that many landlords recommend it.

Wisconsin Law states:

Now my understanding is that Smart Move is a operated by Transunion so it does meed the nationwide "consumer credit report" requirement but seeing as how it usually costs the prospective tenant $25-35 is it legal to require them to pay for the report? It would seem to me that the only legal way to do it would be charge them the $20 fee, pay the smart move charge and then eat the $5-15 additional cost. Although it is possible that since the prospective tenant is personally paying for it and not handing money over to the landlord that it is still legal to require it.

Do you use Smart Move and if so how do you go about it? What are your thoughts?

Congratulations Derek! I love how ambitious you are taking on a huge project like that. It looks like you've got it all planned out and I can't wait to see the photos as the rehab progresses. 

I don't have a lot of first hand experience but I don't see any issue. Deposit it in your account and move the security deposit portion to a separate account. Is there some law in your state that you're concerned about?

I think what you mean is Fannie/Freddie loans seeing as FHA loans require you to occupy the property.

 Thanks Ricardo, It's a great time to do so with most markets doing great.

So being my primary residence it may not be your traditional success story but being new at this it's pretty exciting to me and all I've got so far.

3 years ago I purchased my primary residence in a fairly distressed condition. It was mostly live-able aside from some plumbing issues causing it to smell of sewer gas (bad smells always make for a great deal) and was very dated. Since purchasing it I have completely remodeled the kitchen, 1.5 baths, all flooring/fixtures, replaced the roof, repainted the exterior and added a nicely appointed rec room to the previously unfinished basement. With the exception of the roof I did all the work myself. I recently met with the bank to do a cash out refinance to invest in a rental property or two. 

The numbers are as follows:

Purchase price: $130,000

Rehab costs: $25,000

Current Appraisal: $217,000

At an 80% LTV I'll be able to cash out $53,600 which will be great start for my buy and hold endeavors. Now I'm looking forward to finding that first rental property, hopefully I'm able to find something in a similar state of distress and can repeat the process.