All Forum Posts by: Todd Rasmussen

@Rebecca Webbe

They are most commonly called Rental Dwelling Policies. It is similar to your homeowner's policy less a substantial amount of personal property. Having a quality agent is more important than the company, but any of the big ones typically do well on the claims side. Just understanding your coverages puts you in the 90th percentile when it comes to insurance knowledge. It will also be most effective to set up your policy to cover large losses and retain the risk of smaller losses. If you are calling your insurance company because your fence blew down, you are going to have a rough go of it. You'll lose claims free discounts and be harder to insure if you start making claims, so keep a higher deducible, realize some savings on your premiums, and self insure any loses less than the five digit numbers.

@Jennifer Gore

Are you planning on buying cash? If so, you could probably be more efficient than this route.

Same concerns as mentioned above, although our vacancy rate in Middle TN has been about 6% but I plan for 8.3%.

@Gurjot Grewal

You need to stick with it. Having a tolerance for a bigger rehab will result in a better likelihood of finding a BRRRR project, however your expense projections appear aggressive already. I would definitely not lower your cash flow requirements because of this.

Ask an experienced REI what kind of REI they are. Chances are they will not give you one answer. This is because if you are only using one template, only one type of property will fit. Bad BRRR's can be great flips; don't limit yourself to one approach.

@Sara Campbell

We'll be at meetings starting March 2023. Moving to town.

@Asa Aldridge

The chances that you NEED an LLC are probably zero. At this point it is most certainly just a distraction. Any LLC other than a single member LLC will have negative tax consequences as well. Talk to a CPA and a civil litigation attorney after you make sure you get or confirm you have a liability umbrella insurance policy.

@Moises Guerra Garcia

Sounds like you and your agent do not have compatible expectations. Have a conversation about expectations and if the arrangement isn't working for either of you, go get a different agent.

@Angie Nasrallah

Take the loss now versus a bigger one later. Sell the house for what you can and make good on your debts ASAP.

@Michael Creamer

You can write off expenses for rental property as a sole proprietor and should be filing IRS schedule E. The net of having a business entity usually is additional costs and not savings. If you have an exigent circumstance you should talk to a CPA before making any moves.

@Shella Stephens

As the borrower, you'll be in breach of contract with your lender. In the loan docs you pinkie swear not to do it. When we buy subject to, we have the seller sign a contract that they know by doing this they are breaching their contract with the lender.

@Julie Marquez

If you have dozens of accounts and LLCs for 25 properties, does that mean you have one company and one account for each? If so, you are a glutton for punishment!

We have 22 and are just getting ready to start our second LLC. We've consulted with a couple lawyers and there is a famous case out of New York where a cab company structured every cab as its own LLC to protect the cab company's liability. The case law that came after they tried to isolate all of the assets of the different LLCs from the cab company was that if the LLC's were engaged in similar businesses with the same ownership then there were essentially the same company. I imagine you are set up much the same way and your network of LLC's is not the impenetrable fortress you were told it was. I'd consult with a lawyer and a tax professional and consolidate unless you are slow playing us and the 25 properties are apartment buildings with different partners.

We have two bank accounts (could be one) and one LLC for our properties (soon to be two). I use Excel to track depreciation and Stessa for all income/expenses. Stessa is currently free but they were bought by roofstock. So far all of their monetizing on the platform is through advertising.