All Forum Posts by: Peter Philando

Thats awesome that you are going to invest in your city. Since you're away often, I guess you would use property management? I only have experience with 2 property management companies ... DM and I'll give the scoop. Since you are very familiar with the city, which area are you interested in? I'm in FL but establishing a rental portfolio in MGM ... not an expert by any means but I can throw my 2 cents in a real estate investing conversation. Contractors seem to be one of the biggest PITA in this business, many don't perform. Sometimes I wonder if they are actually trying to make a profit?? 

Yes, don't overthink it. I don't think that 3" on each side is that big of a deal. $700 is good and if the black/SS combo is available go for that with other black appliances (visa versa). The main thing is that you spend some time making sure that all the major systems are good, including appliances that you'll be responsible for. Getting those things in excellent order while the property is empty is your best bet. Once a tenant moves in you don't want to get a call for ANYTHING. These things will help with the enjoyment of the business and less potential burnout......at least that's my plan

I really don't know much about that part of town, but generally, I stayed away. I have driven in that area but not really interested. I still consider myself a rookie in MGM, but I stay north of Troy Hwy - east of the BLVD. North of 85 - east of Federal dr/Ann st. There are other areas spread around like the garden district, Cloverdale and directly south (36111). If you're investing remotely, especially for buy/hold, I highly recommend for the investor to spend some time in the cities that they are interested in

@Kerry Baird Thank you for sharing such a valuable resource.

I recently closed on Driving for Dollars (using Deal Machine) deal I started marketing to about two trips ago to Montgomery, AL. I'm doing a light rehab but need to refinance to execute the BRRRR strategy. I reached out to my go-to lender, Patch of Land, and they are not doing any long term loans right now. Here are the terms offered:

50-65% leverage
100% rehab (if needed)Rates at 10.5-12.5%, 12-month interest reserve, 12-month loan no prepayment penalty, Greater of 3 points or at least $3,500 points

I reached out to Lima One Capital and they are still doing cash-out refinance @ 70-75% LTV for 30 yrs, so I'll be going that direction and will post the deal details once finalized.

Keep grinding guys

I believe most of the traditional banks need the property to be owned outside of an entity (owned personally) for at least 6 months. I cash-out refi with the hard money type lenders, like Visio lending, lima one capital, etc. I personally used Patch of Land. I do the BRRRR strategy so I factor in the cost upfront before purchase. The interest rate is most like a bit higher than the traditional bank, but the process is usually simpler. An added benefit for me is that those loans don't show up on my credit, so you can buy off the MLS and refinance via alternative financing.

I invest OOS (FL --> AL) and originally have several properties between 2 management companies. My original intent was to eliminate the part of the business that produces the "tire landlord" syndrome. The reality is no one is going to be more concerned about your bottom line and your properties. The next few properties I will be self-managing with the option that if it becomes too overwhelming I can turn them over to a PM. Its a tougher decision to make when you're OOS. I would really think hard about it. If you put the wrong tenant in your property you can have an extremely frustrating time.

As usual, Greg, thank you for your response especially when it comes to MGM specific questions ..... highly appreciated.

Looking to get an idea for roof repairs in the Montgomery area. Shingle roof replacement cost for a 1500 sq ft house. Is using the house square footage a good way to estimate the roof sqft? What do roofers charge per square (10x10)? Any recommendations for good reasonable roofers in the area?

The IRS allows any sole proprietorship or partnership (LLC) that is wholly owned by a child's parents to pay wages to children under age 18 without having to withhold the payroll taxes. However, if you have an S or a C-Corporation you do not receive this benefit of avoiding FICA when paying your children.

This is a great strategy to start the kids building wealth. Put them on the books and open a custodial Roth IRA (or regular ROTH if 18+). They can contribute as much of their EARNED income up to $5K each year. Sometimes grandparents who have to take required minimum distribution from retirement accounts, but don't necessarily need the money, can contribute for the grandkids. The grandkids can keep their earnings to do other things.

The kids must perform an actual job..... answering the phone, scheduling appointments, if self-managing.. offload some of the PM duties. You can come up with lots of things that you would have to pay someone to do .... pay your kids instead .... just make sure they are doing the job.

Hope this helps

I have rentals in Montgomery, AL and use State Farm. They are all owned by an LLC and insured as such. I don't believe that should be an issue. Hopefully, someone from TX can recommend a company that they use. Insurance rules are state-specific but still don't see where there should be an issue. Best wishes.