All Forum Posts by: Ruth Lyons

Hit post by mistake — sorry everyone.  What I was going to say is that hiring a good contractor for a flip is as crucial as placing good tenants if you are using a buy and hold strategy 

Thanks for posting Nathan! Way to jump in and get started! All great comments too. Contractor is as key to flipping as tenants are to bu

To reiterate what's been stated, cars are expenses, not assets. Sell the car and use the money for the downpayment.

Responses here offer a lot of great information and sound advice to consider. Here's another perspective. 

I invested in real estate for 3 years before I got my license in Maryland. I paid agent fees as needed. I was working with an agent who charged a minimum of $3000 which meant that, on one of my properties I purchased for $92,500, I paid the bulk of his commission at closing. Would I have rather not, of course! But there's a cost of doing business and agent fees is one of them. 

Since getting my license, I realize how hard agents work -- and how much work they do for free in hopes/expectations of getting paid down the road. Agents have hard costs that are paid out of pocket each year, whether they do any business or not. Between licensing fees and fees for the tools of the trade (Broker fees, Association membership which is required, Showing Time membership, Sentrilock boxes and monthly assess fee, MLS assess, etc.), I paid over $3,800 in obligatory fees alone out of pocket my first year as a Maryland-licensed agent. That doesn't include marketing, gas and car expenses and other costs incurred in doing business to potentially earn a commission. During my first year, I had multiple deals fall through for no reason other than what I refer to as "buyers and sellers behaving badly". Agents spend tons of time, energy and money working on deals that never get to the settlement table and no commission is paid.

Most people don't realize agents work on 100% commission -- that's how the industry is set up. And that is good for consumers in that it acts as a barrier to entry for many people who think they can make a lot of money in the industry by just showing up. Agents who make it (and the attrition rate on agents is very high in the first 2 years of being licensed) work hard to provide an exceptional service for their clients, with the hope and expectation that their clients will turn to them with their next real estate need and refer them to friends and family. 

Do your due diligence to find and hire a good agent, and then be loyal to that agent. Agents can't afford to work for free nor should they be expected to.

Thanks for this important reminder. And congrats on your deal.

Thanks for the question and answers. I haven't run into this particular issue personally, but I learned something I didn't know reading this! I have learned that it's important to choose a lender who understands investors. The run-of-the-mill loan officer doesn't have the experience to understand investor goals and advocate for us. I had an experience where I was doing a refinance and the property was owned by my LLC. It wasn't until the last minute that the loan officer told me that we needed to dissolve my LLC and re-title the property in my name for the loan to get approved. I did in order To get cash quickly for another deal I was in the middle of, however that messed me up on other aspects of my business. A more seasoned loan officer who understands the needs of investors would've picked this up earlier in the process.

I'm so sorry you're going through this. Lots of great suggestions in the posts. Just be careful how "hands on" you get. With a SDIRA, you have to keep an arms length distance from the money. Violating this important rule could get your entire SDIRA money disqualified and you'd owe taxes and penalties. 

I would start the eviction process -- you can always not pursue it if tenant pays rent. If not, you're on track where you need to be. The idea of small claims court above is interesting, but wouldn't be a good course of action in Baltimore County, MD -- takes 3 months to get a court hearing in the District Court. 

Great responses above. Give them 30 days notice if they are month to month. Cash for keys if you want them out sooner.

I was an investor for 3 years before getting my license. I was buying rental properties and didn't need my license during that process. Work with an agent to get listings (seller pays the commissions and you get buyer representation) and get on wholesaler lists to find off-market deals when you start out. It was only after I had my rental portfolio set up and realized I loved real estate that I decided to get my license. I agree with the comments above. You can learn what you need to know through self-study--the state course is no help as it's basic and legal stuff.