All Forum Posts by: Tahra Wright

Hi Antonio!!!

It takes about 10 minutes to set up an LLC, especially if you are the only member. I do it all the time. You can go right on to the state website and set it up and get your EIN fast, so there's really no reason not to do it now. If you are setting it up with a "3rd party" then you need a good operating agreement in place so it might take a bit longer, but you still need that in place before you both go off looking and getting deals with business partners. It saves you from the "I thought he/she was doing that, or giving that, or agreed to that" later on.

Plus, if you are dealing with bank-owned properties and get them under contract, in general they DO NOT let you transfer the contract after it's accepted.  It has to close in the name of the person/entity who put the offer in.

For other properties that are off market or with homeowners selling, they typically don't care if you change the purchaser name. If you are purchasing buy and holds, it gets to be a little trickier if you use a bank loan in your personal name and try to flip it to an LLC later. You will have to deed it to your LLC and in some states (like NJ) you have to pay the realty transfer tax on the transfer (ask me how I know...lol), plus now the insurance has to be changed to insure the LLC and some lenders if they find out can enforce their due on sale clause and accelerate the loan (this is a risk of business some folks just take, if it happens you can always deed it back to yourself and pay that transfer tax again!)

No way, my husband doesn't even want to fill out the paperwork! lol 

He's the boots on the ground part of the business.  He is the project manager for all of our deals.  We have a dedicated agent who sells all of our properties and my husband just takes the referral fee.  Perhaps one day I'll get my license so we can stop paying out that commission, but for now since we both have day jobs, this works just fine!

Are you referring to upstate NY?  I would check out what areas are being defined as opportunity zones upstate.  Look on bigger pockets for a broker/property manager in those areas, and then get some more information about it. Narrow your choices that way.  Those areas are going to be invested in heavily once the regulations on opportunity zones come out, so I would get a head start in those areas for buy and holds.

If you are only seeing a negligible difference between 3 and 4 bed rents, then you might as well keep the DR and a 3 bed.  There may not be that much demand for a 4 bed rental in your area, which is why the price differential is so low.   Plus, for someone to want a 4 bed rental usually means they have at least 4, if not more, ppl in the family, where would they be able to sit and have a nice meal?  Unless the kitchen is large enough for a proper EIK (not just an island with island seating) then I'd keep the DR and the 3bed.

Hey there! Is the plan for yourself or to share with third parties?  Is your business a flip or buy and hold strategy? Are you looking for investors or for hmls or banks to lend?  Depending upon your audience and strategy you might want to include your price point to buy and what to sell at (if a flip) , and what amount you have for proof of funds or a down payment, if buy and holds knowing what rents are in the area you are interested in.  I don’t mind sharing the plan I prepared for my flipping business.  It was geared to PMLs.

Well first Congratulations!!! Celebrate the “win”!!  What were your plans when you initially decided to purchase it.  Flip or buy and hold?  What diligence, estimates etc. did you do or get already?  That will determine next steps!

If you are working with an agent that works with investors, they know the drill.  I prefer agents who are also investors because they can right away help you to analyze the deal based on what you want and tell you yea or nay.  We were more concerned about getting access to properties on our timing and not having to wait for when the agent was avail.  So my husband got his license just so we have access to the mls.  He does not help other ppl buy or sell homes.   With mls access we can get the showing instructions and go see the property on our own time.  Plus we can go direct to the listing agent and let them out the offer in for us. It’s a better way to build relationships with a lot of realtors!

Your numbers are your numbers, so you shouldn't  think that you are being conservative and don't worry about being "that guy."  I agree with Chris that the longer DOM the better.  If the property was just listed and the numbers don't work for you, you can always put in a lower offer.  I've seen properties get purchased at 1/3 of the list price and it happened in less than 30 days, and I've thought to myself "I would never have thought they would take that #." So, you just never know. All they can tell you is no, but if you watch it for awhile and its just sitting there then that's when you should reach out to the listing agent and see what's going on.

No way to cash collection!!!!  I don't care where it is located.  What if you can't make it out to pick up the money, what if you are sick or away on vacation, then what?  We had a 17 unit building where all of the tenants were used to paying cash.  When we bought the property we told them no cash payments. Each month we would send them a rental invoice and we'd include a stamped and self-addressed envelope to our POB.  Even without a bank account, they can get a money order from money gram, western union or elsewhere.  All our tenants got money orders and there were no excuses about having an envelope, stamp or anything else.  Worked very well for us. We just bought a three family and same issue.  We sent them a notice for the first month telling them they will have three options to pay rent. 1) through cozy.co, 2) by putting it in the mail or 3) by using Zelle through their bank.  For that first month only we included a stamped and self-addressed envelope to our POB for convenience, but let them know after that they need to send it in with their own envelope and stamp.  Have not had a problem.  one pays through cozy and the other two send money orders.

Here's my take on it and I am an attorney and my husband is an engineer and we have three kids. My husband and I invest now to supplement our income with the goal of replacing it in the future.  However, the idea of financial freedom through real estate (so you can leave your day job) of course takes longer the higher your income. The only way to really replace your income where (if you have a family) you'll feel comfortable that it will be stable over time is through purchasing buy and hold properties  that are cash flowing properties.  Either by yourself or with others you could purchase larger multifamily units or portfolios of properties and put property management in place.  We are flipping properties now to get "quick cash" that we can use to invest in multi-families.  You start out small maybe with a few three or four families that you have and put a property manager in place.  Then if your goal is really to leave your practice you have to figure out how many units you need and how much each has to cash flow to replace your income.  We've been in corporate jobs for a long time and of course spent a lot on our education, but we are both ready to leave.  However,  we also know and have experienced the great the benefits of having that corporate income, paystubs and W-2s to help us get financing from larger institutions to fund these acquisitions.  So we've been hanging on as we build our rental portfolio.  If you want to be more passive you could be a private money lender, but at your tax rate, it may not even be worth your while to do that.  Buy and hold properties are much better for the tax benefits.  Def something to discuss with your accountant.