All Forum Posts by: William Joel Idleman

 @John Mocker is right.  Think about how much a new truck is off the lot now.  $50k minimum.  The state minimums may not suffice in cases of serious bodily injury or property damage.  I recommend finding an insurance broker in your area.  A captive agent is one who can only write insurance for their company specifically.  For example, a State Farm agent can only use State Farm.  This is starting to change a little.  Some captive agents are able to shop a few other companies now.  I've always found the best value in a insurance broker because they are able to shop more insurance companies and provide multiple solutions.

@Natasha Pollock I have a friend who write these types of loans. I'm checking with him to see if he can write in Texas. We've spent a decade in the military together so I trust him to help. I think the are writing 90/10 LTV last time I talked to him. However, it may have changed since then.

I'm going to go against the grain here.  I'm not a fan of HELOCs in a rising interest rate environment.  I would rent it out and buy another place.  Hang out and see what these interest rates do over time.  If they get back down to around that level then consider cash out refi.  This is a problem a lot of people who have low interest rates are going to face. 

I have a friend who is a lender and they use private money.  The interest rate is usually a few points higher but they can generally go 90/10 on property.

In your position you have two objectives.  First, reduce the cost of living/live for free if possible.  If you're able to do this and in 4 years you breakeven on the sale of the duplex that is still a win!  If you sell it for a profit even better!  If I were you, I'd look at the worst case scenario.  

She finishes residency and takes a job across the country.  The market has dropped and you're upside down in the house.  The house isn't cash flowing either so you're paying $1k/month or more out of pocket.  

IF that happens, are you okay with being a long distance landlord and paying a little out of pocket until the market comes back?  If so, then move forward with it.  If that's too risky for you, then maybe go smaller on your purchase or rent at a low rate and stack cash in the mean time.  All options are fine because your wife is going to be a doctor and you'll be able to grow a portfolio much faster than most hahaha!

Hey Austin, I use avail.co 

It's $5/unit/month.  It does autopayment/maintenance request tracking/tenant screening/accounting.  

Congrats and best of luck!

You already have some great advice listed above. I would ask yourself if your pivoting your goals because you're getting distracted. For example, you started out and wanted to own 10 single family homes. Then you heard about STR and how it's a higher return so you pivoted to STRs. Rinse and repeat several times and you won't have accomplished anything. It's okay to pivot but it's not okay to be distracted. In real estate, you'll need to pick your niche and be the expert at it. Once that happens other opportunities will arise and you'll have time to learn about those too.

Brandon, in my first couple of deals I won't be using other people's money. I'm going to make rookie mistakes. I don't want to make it with someone else's money, especially friends or family. In your position, I would read every book I can about business and real estate. I'd continue to listen to the podcasts. I'd pick market in which I want to invest and learn everything about it. While I'm doing all of those things, I'm saving toward my 3.5%-5% down payment required for an FHA loan and moving into my first house hack. Real estate investing is simple once you pick your niche, but it isn't easy and it isn't quick. It takes time to grow.

When I listen to friends I ask myself one question, "Are they doing what I'm trying to successfully?"  If the answer is no, then I'm polite and change the subject.  If they weren't successful then I still don't listen to them.  I have people who have never invested in real estate or the stock market try to give me advice all the time.  Be very careful of who you actually listen to about investing in general.  In the San Antonio market we are getting back to normal.  The market is cooling and people aren't paying asking price or $10k over asking price just to get the house.  I'm starting to see price reductions and houses sit on the market longer.  As a buyer, I like this.

I don't believe another 2008 is around the corner.  I believe we have a supply issue with increased demand and both are starting to ease.  Also, think about the due diligence your lender went through to secure the loan.  In 2008 they didn't verify very much of anything.  They just rubber stamped the paperwork and sent it out the door.

If you're concerned or worried, then do what I do.  I have 6 months worth of payments saved up for my property.  That gives me 6 months to solve a problem should something happen.

I prefer clients use a pass through entity like an LLC. Just make sure you have separate bank accounts. When you want to pay yourself, write yourself a check from your LLC to your personal account.

A single member LLC is a pass through entity and reported on the Schedule C.  A multi member LLC is reported on a K1.   A single member LLC should be the most cost effective to file at the end of the year for taxes over a C corp or other non pass through entity.

Either way, I can't fully answer your question without more info.  Hopefully this helps!