All Forum Posts by: Ryan Howell

I just finished reading Profit First. I highly recommend reading it and learning from his suggestions for how to use bank accounts. I have one "personal" account now that all my rental income/expenses flow through. I am also about to change over to an LLC so not I have to switch to a business account, at least that is what I'm being told. I believe some banks can link you business to an existing personal account rather than creating new accounts, so I would check on that.

I'll also being adding accounts and implementing a version of what Profit First teaches.  He recommends 5 different accounts to ensure you are paying yourself as you grow your business.

I’ve used Paige Collie in Hendersonville and he has been very supportive and easy to work with.

I’m also still looking for good banks in the area. I’ve used Hometrust so far but only for conventional financing. TD Bank might be a good option. I’ve had a good conversation with one of their loan officers and they seem to be more flexible.

Listen to the podcasts every free minute you have, in the car, in the gym, etc until you have heard all ~300 hours of information.  As you listen, when you hear a book recommended over and over again go buy it and read it.  By the the time you finish, you will know where to start.  

In my experience it hasn't mattered. It was all based on debt to income and LTV. I would make the decision based on the math and protect for contingencies, i.e. make sure you have sufficient funds to complete the remodel (I like 2x to be safe) and have a plan if things get delayed or the market changes to make sure you don't get stuck with the higher rate for too long.

Your experience with the contractor is all too common.  I've heard a lot of great advice from @Brandon Turner and @J Scott about finding a contractor.  Cheapest isn't always best and find the guys that are at Home Depot at 7am every morning.  Generally, this has been my experience when I went with the cheapest guy.  They take forever, want more money and never answer their phone.  I finally found a reliable contractor, and I pay a little more for him.  In terms of price he is what I consider in the middle, but he is reliable and trustworthy.  On my last job, I had complete remodel after an eviction and he was in the middle of another job.  He worked nights and weekends for me to get things ready to rent.  I paid him extra for going the extra mile.  Those guys are hard too find.  When you find one, take good care of them.

Yes it can be done. I'm on my 3rd BRRRR deal. My issue is I'm doing it with duplexes so far and there are very few comps so it's a little more difficult that SFR in my area. Essentially, I end up with a little more cash in the deal than I could have with single family.

My understanding on the residential side, at least for banks that are selling the loans off, is they are required by law to use independent appraisers drawn at random.  At least that is how the loan officer explained it to me.  

My opinion is to pay off your debt.  I personally think there is more to the equation than just comparing interest rates.  Make sure you have the cash reserves to handle emergencies (both personal and in your real estate investing).  I suggest 3-6 months for personal expenses as well as for whatever your investments will require.

I personally only take on debt if I'm leveraging an investment asset to increase my rate of return.  I'm not a fan of carrying consumer debt or car debt, because those are liabilities that are going down in value and slow me down on the path to financial freedom.

Imagine how much less stress there is when something breaks on a rental property or tenant moves out and you have plenty of savings to handle the lack of cash flow for a few months.

My criteria is it must have positive cash flow and I must get some equity in the deal. I never bet on appreciation or rent to family. Personally I would avoid the deal. From my experience, it’s easy to try to make something a deal because you get emotionally attached. Determine your criteria and stick to it and don’t try to force a deal if it’s not there. Good luck.

Go for it. If I knew what I know now when I was buying my first house I would have house hacked. It is a great way to start, learn the process while reducing your risk. My advice is to run your numbers assuming a house hack and with both units rented out to make sure the deal still works and cash flows after you move out.