All Forum Posts by: Nicholas W.

Congratulations Marcus. I hope to connect with you and potentially work with you as I begin my search for my first rental property.

I hope to be able to make it!

Congratulations! I also just took the first step, in my case that happened to be a cash out refi on my primary but you're right it does feel good to be taking action finally instead of just learning.

If the immediate purpose is to separate funds you can set up a business account at any bank. You could even set up a DBA (Doing Business As) so that you can work under a fictitious name. It would seem an unnecessary expense to create an LLC just to separate funds.
Also before speaking with an attorney I would check with a CPA. The difference between an LLC and an S corp is more related to taxes than it is to legalities.

I'm not saying it's the best decision but considering the cost of well drilling and septic systems many of the installation contractors offer third party financing. You could call around and ask if any of them offer that.
Honestly $8200 and $6000 for a septic and a well isn't all that bad. My septic system install alone was $14k. Here in Wisconsin it it standard to do a "well water and septic" test during any real estate transaction. Obviously hind sight is 20/20 but something to keep in mind for next time.
Good luck with it all.

 Gregg, That is very helpful, all that being said do you recommend taking a EM deposit or to just avoid it given all strict guidelines involved? I guess it would depend on the market and the demand for the specific unit but what do you generally recommend?

 That makes sense and I understand not wanting to go through all of that trouble without some skin in the game so to speak.

 Well he said he specifically applies it towards the security deposit, but what line item on the move in funds it goes to I guess is irrelevant.

Where I'm getting my info on the earnest money deposit is most specifically from the following blog post: http://petriestocking.com/blog/landlord-tenant/ear...

And more specifically page 6 of the landlord tenant guide: http://datcp.wi.gov/uploads/Consumer/pdf/LT-LandlordTenant2014Guide497.pdf

 Thank you for the input. In the event that it went to court wouldn't a "holding deposit" be considered an earnest money deposit, regardless of wording, in which case it couldn't be completely non refundable? I do like the fact that you only take $100 though as it wouldn't be hard to itemize that since on a $600 rental that is only 5 days worth of rent lost which should be relatively easy to prove in most instances.

Out of curiosity why not just have them sign a lease right away? Is it because scheduling the lease signing so quickly would be difficult or is there some other legal (or otherwise) reason not to sign until closer to a move in date?

So I am reading The Book on Managing Rental Properties and Brandon recommends taking a deposit within 24 hours of accepting an applicant. I understand the concept I think it's a great idea. The trouble is in Wisconsin this earnest money deposit has very specific restrictions as to how quickly it has to be returned and what specifically it can be applied to. Unlike Brandon recommends (which probably works fine in his state) I can't just take the full deposit without first trying to fill the unit to mitigate losses and itemizing what the deposit was used for (additional advertising, number of days rent missed, etc.) For this reason it seems that taking an earnest money deposit is more trouble and risk than it is worth in Wisconsin.

One question I have is when bother with this at all? Is there some reason not to just schedule the lease signing as soon as possible, even if the move in date isn't for a week or two? What am I missing?