All Forum Posts by: Terra Padgett

I'd add flipping, buy & hold rentals, private money lending, etc to the list for any investor 'lacking direct knowledge and experience in these investments.' Lol. Knowledge is power and without it, you increase your risk exponentially. But yes, everyone must start somewhere and I'd venture to say Tax Liens is a tricky one.

I've used them for setting up real estate Trusts, but that's about it. If I needed another RE Trust I would go back to them. I wouldn't use them for setting up an LLC. They are knowledgable in their space, but I find them on the pricey side. If you are new and don't have a clue, then I would certainly recommend them or some company that can guide you through things until you have an understanding. However if you understand the process already and what you're trying to achieve and just looking for someone to do it for you, then I would search a bit more to price compare and then make your informed decision. Hope this helps!

I don’t know if innovative per se, but I’ve been investing with smaller amounts (5k-25k) into large multi million dollar projects by leveraging the investment club model. These deals typically require larger cash outlays (50k-100k) per deal minimums. But by coming together with others, one can get in the game and put their money to work in these bigger, potentially greater return deals without having to do it solo. Game changer for active investor looking to get more passive investments, busy professional looking to diversify in real estate, individual investor looking to get into commercial or larger assets. 

Utilized a Solo401k to purchase our first few properties. You can purchase the property within the SoloK outright if you have enough or with a non-recourse loan if financing. Or you can do a participant loan from it and purchase outright or combined with financing. You have several great options already listed as well. You can also add Cash Value Life Insurance policy and Business Credit to your list of options. Seller financing and “Subject To” are other financing options to explore. 

Several options you can explore to get the down payment capital: Solo401k; HELOC on personal residence or from equity of the SFR; Cash Value Life Insurance Policy; Business Credit; Private Lenders, to name a few. Each are great strategies to access capital and each has its pros/cons for utilizing the strategy in the best way. If you're unfamiliar with any of them I'd encourage you to do some research. I've utilized several of them for down payments or buying a property outright. You can definitely get access to the capital you'll need, but set the expectation for yourself that it won't be a cake walk. Feel free to PM me if you'd like to discuss any in further detail.

While cash flow can be nice to see each month, it can be fleeting and inconsistent. As expenses fluctuate (property taxes, insurance, maintenance items, etc), the cash flow is up and down and unreliable. Cash flow, especially in this day and age, helps keep the property afloat and paying for itself without you having to put more money into it.
Appreciation on the other hand is the biggest piece of the real estate pie. It takes longer to realize, but the gain is worth so much more than a couple hundred dollars of cash flow a month. And historically, real estate has a proven track record of appreciating over time. So while cash is necessary to keep the property afloat, I invest more for the appreciation of the asset.(and depreciation & other tax benefits 🙂)

While cash flow can be nice to see each month, it can be fleeting and inconsistent. As expenses fluctuate (property taxes, insurance, maintenance items, etc), the cash flow will be up and down and unreliable. Cash flow, especially in this day and age, should keep the property afloat and paying for itself without you having to put more money into it. 
Appreciation on the other hand is the biggest piece of the real estate pie. It takes longer to realize, but the gain is worth so much more than a couple hundred dollars of cash flow a month. And historically, real estate has a proven track record of appreciating over time. So while cash is necessary to keep the property afloat, I invest more for the appreciation of the asset. 

If you’re looking to make real estate your new job and to earn cash now to use and live on like a job, then go for cash flow. If you’re looking to build long term wealth, accumulate assets, take advantage of tax code, and benefit from appreciation, then play the appreciation long game. Both are strategies, it just depends on what you’re looking for now versus what you’re looking for later. Maybe a mix of both is the right answer for you. Do some wholesaling and fix & flips for some cash now, but also buy some rentals and land for some long term gains. 

Pros: Lower price point than a house. Typically just responsible for the studs in. Not responsible for lawn care. 

Cons: HOA assessments and increases. Neighbors activity or their poor unit maintenance affecting your unit or tenants. Red tape with trying to get the HOA board to approve repairs. Condos don't appreciate in value as well as homes do.

I think if the investor has had bad experiences prior, then Yes, a call from any sponsor comes with a cloud of anxiety on what the call is about. I remember with my SFRs in the beginning, it seemed liked anytime I spoke to my PM there was an issue that required more money out of pocket. I got sick of seeing their emails or phone numbers pop up. Several years later and though it has gotten much much better, there's still a level of "what now" that crosses my mind when I get an email from them. Lol. I personally just want the monthly/quarterly updates and the inbound wires received. Same in the syndication world. I just want the monthly/quarterly updates and the inbound wires received. 

Now with that said, if they're hosting a live event or an invite to something, of course I'd want communication. However someone's past experiences will definitely dictate their reactions/perceptions in the present. (note: there was a whole chapter in the book "The Psychology of Money" regarding this)