All Forum Posts by: Scott Lundgren

@Fili Aguirre

The question you are asking can be interpreted differently depending on what your end goal is.   If you are an out of state investor that is rehabbing and you need someone to double check the rehab and show the property for potential sale or rent I would suggest using a property management company.   But if you are wholesaling and just trying to confirm the condition or get a contractor in to bid then you would want to find a local realtor that would do that for a small fee.  There are plenty of struggling realtors out there that would do that cheap, I know because I was that struggling realtor at one point and did this for out of state investors to help me get started in Real Estate.   

I would only work with a licensed individual, too much risk hiring random people that haven't taken the time or care to get licensed. When someone is licensed they are insured also, if something does come up that you need to recover you can always work with insurance companies, but individuals can very quickly disappear if something goes wrong and your recourse is almost zero in that scenario. 

@Marcus Holloway This was a costly lesson for me.  I believed that I could research and find the same answers or solutions that experienced investors or partners knew, but without having to include them in my deal and split my profits with them.  And for most of the time I could, but when I made a rookie mistake it would cost me far more than splitting profits.  The greed of telling myself that I could do it on my own and make more was the biggest mistake of my RE career.  It took me many 'rookie' mistakes, or using your term 'trial by fire' losses before I realized that its just not worth trying to be a jack of all trades investor.   

Treat it like a business from day one, if you were to open a restaurant would you be the cook, server, greeter, janitor?  Of course not, so decide your role and find a quality partner or sub for the rest.

I started off wholesaling but now I'm heavily invested in rentals.  I don't want to be the property manager so I hire a PM team.  I don't want to rehab so I sub that out, but I love to hunt the deals down so I focus my time on acquisition.  This allows me to stay in my area of expertise but still have the business running smoothly. 

@Robert Keeling If you search BP you will see many posts on this same subject. I've been selling RE for almost 20 years now to retail buyers, and for the last 15 years to investors. I have heard about every argument about LLC's and Trusts and the answer always boils down to your needs. There are 2 main reasons to start an LLC for investing, tax benefits and legal protection. What most people don't tell you is that they are at odds with each other. If you contact a CPA they will recommend an entity structure that maximizes tax breaks. If you contact an Attorney he will recommend a different setup that will maximize asset protection. You need to have both conversations and then make a decision based on what your goals and needs are.

Let me give you 2 scenarios to help make my point.

Scenario 1 - Investor A has a few properties, lots of stocks, lots of liquid capital, decent retirement, high income earner, single, no kids.   This investor will most likely listen to the CPA as his Tax Liability is high and his biggest impact to his growth is taxes.
Scenario 2 - Investor B has a many properties, a little bit of liquid capital, large retirement, lots of equity, married with kids.  This investor will most likely listen to the attorney and setup a Trust and entity structure that maximizes asset protection.

When it comes to cost this is not where you want to shop for the cheapest deal in town. There are cheap inexpensive ways to setup an LLC but they won't give you the benefits that you want. If you contact an online marketplace that stamps out LLC's they will provide a step by step to get one setup for very little money. But an attorney would provide articles of incorporation and an operating agreement along with the LLC to designate it for your tax or legal needs that are important to you. Without these supporting documents you will be very disappointed when it comes to using the LLC for your desired benefit.

Sean,

Your plan is a great one for helping you reduce your overhead to increase your capital savings. Dallas can be a great city to live in, and right now is absolutely booming so your timing couldn't be better. Income tax free doesn't hurt either. You can search BP posts for people using the 'House Hacking' strategy, or the 'BRRR' method where people share their stories of similar ways to build capital creatively. The beauty of RE is there is many ways to make it work, you just need a plan and stick to it.

@ Joe M There are many good connections you will make on Bigger Pockets for people in the QC market.  The advantage to finding them here is that most have already been vetted and have reviews you can look at.  If you search the posts you will see several threads already on this subject you can grab the referrals from these posts.  We have found a couple of great partners in the QC through BP.

And find out where the high speed rail is going to be located to Chicago, that will be a huge push to the QC neighborhoods around the rail lines for rentals. 

@Kevin Ivey 

@Kevin Ivey we recommend using Brenda Benson @ Trilogy Properties, they are familiar with out of state investors and have processes in place to make that simple.

@Harvey Roberts welcome to the BP community, when it comes to borrowing capital with most traditional lenders, especially when it gets to the lower amounts will be difficult.  You want to look for private money.  You can do this locally by searching that city/counties RE Groups, or you can establish a credit line with a bank and use the credit line to fund the deal.   There are some that will give you 5-7x Liquidity.  Meaning if you have 50k in the bank you can get 250-350k line of credit.   

Welcome to BP, most people on here are looking for the same thing, to connect with honest good like minded professionals.  The best part is we are all here to uplift each other so you will find many great references here.  We have connected with several great teams in IN through BP.  When doing your search be specific to location and service and you should get some great options.  You can also search similar posts of others that have already done the same thing and see their results without having to wait.  I've found several great connections that way. 

Being involved in Rental Real Estate for over 20 years I have my own list of what I need to invest out of state, but I wanted to hear from others on what they feel is important for them to find in their search for a good asset out of state.   For me the 3 most important things to have is a Quality Property Management team in the local area, a reputable contractor for upkeep, and the location to be in a nicer neighborhood. (which helps draw a better tenant).  What is the most important thing for an out of state investment for you?

@Kyle Nichol

Ty for the reference Joe.   

Kyle,

If you would like to talk with me personally we can see what we can do for you, feel free to message me so we can connect when you are ready.  We can help you with your search for the right property.