All Forum Posts by: Sean Leonard

Quote from @G. Brian Davis:

@Don Konipol I totally agree. I actually aim for not having any one real estate investment make up more than 1% of my net worth. I do that by going in on them with other people through an investment club (I can invest $5K in each investment). 

To your point, passive real estate investment returns tend to form a bell curve, with a few underperforming, a few overperforming, and most falling in the middle of the bell curve. When you only invest in one or two, the returns could end up anywhere on that bell curve. When you invest in one a month (like we do), they form a classic bell curve over time, averaging stronger returns than the stock market. 

So, you need at least $500,000 in liquid assets to become a passive investor in your Co-investing club? ($5,000 / 1% = $500,000) --Sean

@Michael Norris, Yeah. I've seen news reports of the same, especially in California.

I reached out to Arcana (now MSI) as they are recommended by a number of threads I've seen on Bigger Pockets...They don't deal with customers directly, but did offer a list of agents/companies that will. I managed to get one quote, for $4000.00 per anum. I assume this is competitive but will continue to seek a few more quotes...

--Sean

I own a single family ranch house in Massachusetts, just north of Boston. We had a fire/landlord policy with Norfolk and Dedham insurance, however after my last tenant and last property manager allowed my property to get into a state of severe disrepair, including water damage from a dishwasher/septic backup, which was never remediated, my insurer dropped me from coverage as a "bad risk" (we had made a claim for the water damage by the tenant).

So in this current economic environment, a "bad risk" is anyone that makes a claim against an insurance policy.

The damages have been remediated, the interior of the home has been rehabbed, including a complete kitchen makeover.

My insurance agent had difficulty finding me a replacement policy, given that the property was untenanted, and undergoing construction. She found me a policy that would cover the property for 2-3 months for $1500.00. Given our financial constraints at the time, we couldn't afford such a high sum for limited coverage.

I'm told that the lapse in coverage for the few months between being dropped by our previous insurer and attempting to get a landlord/investment property policy will make if VERY difficult to get a policy.

I'm not sure that my agent really has much experience in insuring investment properties/rental properties.

I reached out to Arcana (now MSI, and they forwarded my a list of agents/reps that could work with me.

My question is: Are there any other places I should be looking to obtain coverage?

--Sean

Quote from @Jeff Nash:

I just responded to an SDIRA question so was confused at first as lending or providing credit would not be permitted in that scenario, but if the LLC is not associated with a retirement account you can really do whatever you want (capital contribution, personal loan at market rates, third party loan, etc).

Would there be a benefit to either?  Would the personal loan, between my wife and I as individuals (lenders) and us as LLC owners (borrowers), be considered an expense that could offset rental income in the future?

--Sean

Quote from @Eliott Elias:

If your property is free and clear (paid off), you may be able to use that equity and borrow against it with a Hard Money Lender. 

We have the money, barely, and don't want to go into debt (i.e. paying interest to a 3rd party for the repairs...)  Especially not in this economy...

--Sean

So, I have a bad property manager who allowed my tenant to let the property fall into disrepair and, because I didn't choose the contractor he recommended, he has let my property sit untenanted x 8 months, not following through on getting me 2 comparable quotes...

So, I now have to have $36,000 worth of repairs performed on the inside of the property and probably an additional $20,000 on the exterior (the latter can wait until I have a tenant...)

The business accounts associated with the LLC's (jointly owned by my wife and I) that own my rentals don't have sufficient funds to pay for the repairs. We are going to fund the repairs from our savings, but I'm wondering if I should "loan" the money to the LLC - drawing up a loan agreement with interest, etc. between my wife and I as individuals and ourselves as LLC owners, or just transfer the money from our savings to the business account and pay it that way (I don't want to pay for it out of our personal finances directly, as that may nullify the liability isolation created by the LLC.)

Thoughts?

--Sean

Thought I'd resurrect this post to see if anyone had any updates.

I'm seeing that a lot of the initial offering tax lien certificates, by some counties, are being auctioned on-line (not a secondary market for liens that went unpurchased at the in-person aution). Does this change the "boots on the ground" approach?

A lot of information regarding crime statistics, and other information can be gathered on-line now.

Does this make buying liens outside of your area easier?

What resources do you use, if you bid this way?

--Sean

Ok posted about Bid Four Assets above and it was starred out. Is this a scam website? Why does it keep getting starred out, Is it "The Website That Shall Not Be Named"?

--Sean

My research efforts continue...

I was a little disappointed to hear about Ohio requiring large bulk purchases (limiting investment to large companies, not sure if I can qualify or what the qualifications would be) and therefore given my geographic location, this may be difficult... Can try looking into New York Counties. This would also be within driving distance.

Went to Tax Lien Lady website, and much like National Tax Lien Association, these are high-priced educational platforms requiring large financial investments in order to obtain any information (in the $1000's of dollars).

I did find another Guru Ted Thomas. But while the others want big investments, Ted's website does offer some freebies...

https://tedthomas.com/wealth-w...

I signed up for free on his website and was sent and email with Links to an information booklet and a list of auctions being held by county and state across the U.S. 

I'm not endorsing his products, or encouraging anyone to buy anything, just making information available to fellow board members that may be in the same predicament I am (trying to learn about a process that is very complicated; is county and state specific; and information is not readily available on the internet without weeding through scammers, or high-priced gurus... or individually calling each county treasurer's office...

I also came across a website: **********

This is a searchable database/auction platform with both tax liens (under financial instruments) and tax deed auctions, with a calendar of upcoming auctions. You can also set up Assethound (like basset hound) for email alerts of your predetermined search criteria. This is probably old-hat for alot of folks on here, but it's new to me. May not be that helpful for me (not looking to purchase properties, just tax lien certificates. It looks like all the Liens up there currently are junk... and in Arizona...so not real helpful...

--Sean

(anyone else have any resources they've found?)

Quote from @Chad U.:

In PA, there are no tax liens, only tax upset sales where you take title to the property subject to any existing liens. 

In OH, you need to qualify with the particular county to buy, and most need a minimum purchase amount to buy in bulk.  They don't typically sell one-offs.  

Any Idea what the price range would be for the "minimum purchase amount" and what would the "buy in bulk" entry amount be?

--Sean