All Forum Posts by: Ryan Cruz

Hi - I’m looking for a recommendation for contractors in the Oakland, CA area. Would anyone here have recommendations they support and can share? Thanks in advance!

Thanks @Chris Mason.  I'll reach out to you offline, as I'd like to discuss further with you.

@Craig Hopp - Interesting that you were able to find a bank at all (albeit a smaller bank) to work with you in this situation.  Do you mind sharing which bank this is/was?

Hi, I'd like to get some feedback regarding at what point I should form an LLC. So currently I own one rental property, and am in contract on another. Both of these properties are out-of-state. I've seen both forum posts and web sites discuss LLCs in the following shapes/forms. Some say to form an LLC for every rental property. Some say otherwise. My previous accountant said that I should avoid forming an LLC until I surpass $1,000,000 in annual gross rental income. He also said that the cost of forming and maintaining an LLC will eat into (and may even eat up) your profits, depending on the numbers. Instead of forming an LLC, he suggested simply to have enough insurance to cover yourself.

I'm going to discuss this with both my new accountant.  However, if there are those here that have strong preferences, I'd love to hear your reasons as to why.

Thanks BP!

@Russell Naylor and @Jon O. - Thanks for chiming in.  You both mention scenarios involving loss of rents.  Are you referring to loss of rents due to needing to evict a tenant (ex. due to not paying rent, or illegal behavior like drug dealing, etc.)?  Or are you referring to any scenario in which the house is vacant (ex. tenant leaves in a normal fashion when the lease ends)?

@Lelith Walker - Thanks for your feedback.  Yeah, I'm considering a replacement cost policy with a higher deductible to get the balance of getting the coverage needed in a worst-case scenario, while keeping insurance costs manageable.  AFAIK, Parma, Ohio isn't a flood zone, but who knows.  I think a more realistic potential scenario are snow-related occurrences.

@Jason Bott Thanks for sharing - that was super helpful in thinking about the different "knobs" I can turn and adjust.  Regarding DP1 vs DP2 vs DP3, it seems interesting to me that there would be no pricing difference if DP3 covers more scenarios than say DP1 - I'm curious as to why that would be.  Also, regarding liability limit, you mention recommending no lower than $1,000,000 in liability coverage for out-of-state investors.  Are you recommending that the amount be in the range to cover the collective sum of the landlord's assets?

All - thanks again for your feedback.  I really appreciate it.

Hi BP community,

So I’m in contract on a property in Parma, Ohio, and I’m shopping around for quotes on Homeowners Insurance. Given that I’ll be a Landlord, are there Landlord-specific things that I should be looking out for, regarding the type of policy and coverages that I should get? Compared to a policy for a residence that I’m living in, I won’t be having personal belongings in the house, so that’ll be the responsibility of the tenant to insure. I did speak with one insurance provider, and they mentioned a DP3 versus a DP1 policy. The DP3 covers more scenarios (water, weight of ice/sleet/snow, falling objects, in addition to all that DP1 covers) compared to the DP1 (fire, lightning, wind, hail, vandalism).  Also, if I remember correctly, the DP3 covers up to the replacement cost of the home, while the DP1 covers up to the market value.

I asked about the scenario of “tenant slips on [part of house], and now wants to be covered, or else will sue”, and the insurance salesperson talked about liability coverage that is typically added (we started at around $300k when cranking out a quote). We also took into account things like locks, presence/absense of security system, amount of deductible.

If there are other things that I should be considering in the course of shopping for a Homeowners Policy as a Landlord, and you can share those tips, I’d appreciate it.

Thanks!

Thanks to all those that replied.  In addition to the resources you've mentioned, I'm also using the following:

• homefacts.com
• crimereports.com
• neighborhoodscout.com
• greatschools.org

Hi @Julie Shepard - I too am from the South Bay.  Did you happen to get any recommendations regarding this?

Thanks @Silvia Batista!

@Matthew Vitlin  - Thanks!  I've set up keyword alerts for the the cities in the Dallas metro area, and I'm reaching out to one Realtor for an initial discussion.  If you have insights that you'd like to share as well, I'd be glad to discuss more.