All Forum Posts by: Justin B.

Sure, the link to join is above.

Yep, like I said, many different views. Mine is you don't need an LLC for every house. I do have a limit of ownership ($ of property owned) before I create a new LLC to help limit the liability somewhat. I do the bookkeeping and taxes for 2 LLC's now and I could not even imagine doing it for 20 of them.

If I was just buying a house or 2, I probably wouldn't even use an LLC (not worth getting into why here).

I have them split between 2 LLC's. With SFR's their is no reason to have each house be it's own LLC (athough some folks on here will disagree with me). I use a local bank for financing. I'd stay away from regional or national banks to be honest.

Well, you can either hold the property in an entity (LLC), or as an individual/trust. That's pretty much it (although I'm sure someone will chime in with some weird way they're doing it :)).

LLC's don't get the same term individuals do. In MOST cases (again, MOST), entity's get about ~1% worse interest, 20-year amm at most, and a 5-7 year call. You also still have to do a personal guaranty, again in most cases.

As to whether or not you hold the property as an individual or in an entity, there are probably thousands of posts already with wildly differing viewpoints.  Some of it is opinion and others based on your situation.  There is no default answer, unfortunately.  Your best option is to explain your situation in great detail and even then, your responses will be split as to which way you should go.

One thing I will mention is that once you become a powerhouse with the number of units you have, you may have more leverage over the banks.  Even at 42 units now, I don't really see that benefit.  Maybe I can get a quarter or half point better on the rate than I could when I had less than 10, but that would be the extent of it.

Some folks have missed the key piece that it's in an LLC. I think the closing costs may be a tad too high, but for loaning to an LLC, the best you'll get is 20-year amm in most cases. I would consider this a decent (not great) loan for an LLC.

I think you should potentially shop it around a little, but it's not bad what he's offering.  One last thing.  If you're goal is to pay it off quickly, go with that.  If you're goal is to get as much cash flow as possible up front, shop it around a little and find a 20-year amm somewhere.

Getting out of the rat race is really a relative phrase.  In the Rich Dad world, he's referring to working for someone else in a job, investing typically (401k, etc), working until retirement age, then living off of what you've saved.  Like some of the others, I love my day job and I invest in real estate.  I also have a 401k, invest in the stock market on my own and a couple of other things.  Whether I'll ever quit my dayjob depends on a variety of factors.  Currently, I have a really good work/life balance, love my day job, and have no plans to leave any time soon (regardless of how successful real estate if for me).

Again, he's just referring to getting out of what 95%+ of Americans do daily and becoming your own boss through real estate.  Whatever your goals are is what you should aspire to, whatever they are.

 The shortish long answer.

-- Bought 13 SFR's from 2010-2016: 8 through different usual means (Agent, Friend, MLS, Driving Around, etc), 5 through a turnkey provider. None of which needed major work.
-- Bought 5 MFR's from 2016-2017 in this order (5-unit, 3-unit, 12-unit, 14-unit). 2 of which needed a decent amount of work.
-- Sold 5 of the SFR's in 2017 (The turnkey ones) to go back down to 42.  It's just part of our plan to sell off all the SFR's eventually (and use cash for future MFRs) because our focus has moved to MFR's.  In case you're wondering, no reason why the 5 we sold so far happened to be the turnkey ones, except that they were all in the same area and we found a single buyer for all 5 at once.  The fact they happened to be the turnkey ones is just coincidence.

Currently, our focus is getting all the MFRs in their best cash flow earning position (since we bought all of them between Dec 2016 to August 2017).  3 of the 4 are pretty much there and the biggest one needs a few more months, then the plan is to add one more 10+ (maybe 20+) unit in Mid-Late 2018 and then go from there.

All properties have a PM (none self-managed anymore).  We did self-manage a couple of the SFRs along the way but only for a short time before turning them over (usually upon tenant moving out).

42 and counting.

I didn't read all the replies to see if I'm repeating this, but the most valuable things I learned at college were outside the classroom.  The social interactions, experiences, friendships, etc were the most important in my mind (especially if you're questioning whether the learning part is worth it).  Of course, this only applies if you're college age (18-22).  I wouldn't recommend it for "going back to school", unless you have no knowledge of real estate whatsoever.

I can point to a multitude of things (including selling a few properties to someone I met in college years after the fact) that just wouldn't have happened had I not gone.

This also means pick a nice cheap state school (and maybe go part-time if you don't care about the degree).  No sense in spending boatloads and going into a lot of debt for those experiences.

Looking back, I wouldn't have changed a thing!

I didn't read all the replies to see if someone said this, but I think the answer is whatever got me to $20M.  Why change it up?  I often find that I say if I had X, I would do Y, but when I get to X, it usually winds up being different when you actually have it.

If you are talking hypothetically that if I had $20M drop into my lap tomorrow, one of 2 things. Big MFR's if I stayed in real estate or maybe even call it quits. $20M is way more than enough to do what I want to do. I don't have any extravagant dreams for stuff. Won't ever have a plane, the biggest boat I'd want is probably $100k, and I don't need a bigger house (maybe slightly, but we're talking a few $100k at most). My goals are to travel anywhere I want, whenever I want, however I want (I don't need $10k/night accommodations and first class is good enough), and play a lot of golf. The Interest on $20M would be more than enough to accomplish what I'd want to do.

So $20M, I'm leaning on being done or if the caveat was I had to invest it, big MFR's for sure. It's nice to dream right :)