All Forum Posts by: Shannon McKenna

@Vincent Pace Thanks for the response!

Entities are definitely on the list- there is so much conflicting information on the necessity of an LLC vs incorporating vs not using an entity structure. What is your favorite resource on this topic?

@David Zheng 

Well, I live in my parents house when I am not travelling for work (which is a lot), I drive a car that I paid cash for, and my other expenses run around $450 per month. I have about $600 dollars in credit card debit that is gonna be gone in the next month... I'm not sure how much more of a lifestyle reduction I can take!

I guess I could wait longer to buy my first place with cash, but I don't really want to and I don't think I have to. 

It's so nice to hear your story of persistence. I guess I just gotta get back on the phone. :-)

@Tyler Brown-Lewis

Craigslist? I didn't know the kids were still using Craigslist! Thanks for the tip, I'll scope it out!

@Michael Cohen Wow! Thank you for writing from your perspective as a mortgage lender. One of the mortgage lenders I spoke with suggested this as well. It is a route I may consider, though I think ultimately, I will probably seek alternate methods of funding. It's just so convenient to get pre-approved!

Quick question: if I do add back in deductions, do I retroactively pay taxes on that money?

I'm not sure why I feel the need to assure you that I am not committing tax fraud. I study and prepare my taxes each year purposefully and never file without the employment of a professional. I'm trying to get in to real estate so that I can ultimately sleep BETTER at night. Tax/mortgage fraud seems like the opposite!

@Shawn Breyer Great question! I'm wondering this myself... I THINK the idea is that a bank/lender has some magic equation and presumes that I do not show a history of making enough income to qualify for a mortgage. 

You say you write off everything and have no problems getting loans? You should send me to YOUR lender!

It may also be that you make more money than I do, so even after your deductions, you still show that you made enough income to qualify.

@Tyler Brown-Lewis This is a great point! One of my life strategies has always been to put myself under pressure to encourage swift and decisive action. 

However, do you think it is wise to start contacting real estate agents before I secure funding? I know they work on commission, and I want to be respectful of their time. 

@Jordan Grimstad 

Sounds like you're in the funding camp too! I was pretty sure this was the answer, but then all the brokers I talked to were like, "How much is the house?" "What kind of house is it?" Meanwhile, I'm like, well... that depends on what you can GIVE ME! 

-FHA would be great, though it seems like the only real advantage to going FHA is you only have to put 3.5% down. I'm not worried about the down payment so much as securing funding. Is there another advantage to FHA?

-Hard money seems like it would be awful convenient for flipper, but over the long term, I'm not sure that I could make the kind of returns I'm looking for with those kinds of rates. Unless there's something I'm missing?

-Conventional income? Snooze.

@KellyBaird Thanks for those words of encouragement! It sounds like in your opinion, money comes first, and then let the deal follow?

I need a bit of direction. I am a little newbie searching for my first deal, which will also be my first ever real estate purchase... a place I can "house hack" as I build up income for my second deal.  I am looking for buy and hold rental properties for cash flow.

I sat down today and called three different mortgage lenders in my area, to see how much house I could buy on a conventional loan. They all sounded very encouraging until I sent over my tax returns. I have been making a living via 1099 (contract employee) income for the past three years, and... how can I put this? I have gotten very good at claiming my deductions.

The answer to "how much money will THEY give me" seems to be zero, which kind of sucks, because I was hoping to use this number as my parameter when searching for that first deal. Now that I don't have a golden easy number, how would you all recommend I structure my search?

Should I go out hunting and once I find that first deal, scramble to secure funding? 

OR

Should find an entity that will give me my own number, and search for a deal once I know how I'm going to pay for it?

#108 has to be one of the greatest piece of podcasting in all of podcast history. 

If you want to take it back super old school cool, #35 with Paula Pant is another one that's more about real estate in the context of life style.