All Forum Posts by: Aaron Z.

Tom Reid just my 2¢ after struggling with this from both your perspective and your friends perspective in my own RE dealings. Your offer isn't generous enough to attract capitol in large enough amounts for RE investing unless someone is doing you a favor - and family is about the only group that might do that. His offer swings the pendulum too far the other way since you have an established friendship and he doesn't want any involvement. I propose taking his offer and making the following changes: • 90/10 investment (he pays 90, you pay 10) -so you have some skin in the game. • Refi out mortgage in your name and guarantee a 25% return on his initial investment - take care of your investor. • Provide him 10% of gross rents for 3-5 years at which point the property becomes 100% yours. • Allow him NO management or ongoing responsibilities. • IE - I do property vetting, mgt of rehab, mgt property, mgt finances, mgt llc, etc. Make it clear that you want to do this long term with him and that this is just the beginning and that future deals would be more equal as you built up your own capitol from your share of each deal. But, find other sources of funding so that you can show him that you have options and are looking around, but that you would prefer to partner with him because it would be good for both of you. In short, sell him on your plan and make it worth his time to take the initial risks while you don't have experience managing rehabs, etc. once you have experience you are in a better position to make the case for more favorable terms for yourself. This is a lengthy response, but you asked for specifics and you have an existing friendship and are looking for a partnership where you each bring very different strengths to the table...

Natalie Vane Maybe in missing something... In VA you can collect up to 2 months periodic rent for a security deposit. You may choose to collect 1 months rent but that is not a legal limit. And I don't know why you'd take a smaller deposit amount just because the could pay every ~15 days. I hold rent due on the 25th of the month prior, $80 late fee due 5 days later. A couple years ago I instituted a pay rent by electronic funds transfer only policy and haven't had a late fee since. Much simpler process but I understand that it's not a good fit for all types of tenants.

Austin Adee I concur with Steve B. Spend some time building some skills that will command a greater income. That could be a trade skill or another type of in- demand skill that doesn't require a long degree. There are classes at your community college that could translate into a good paying hourly job like CAD for example. MMM (Mr Money Mustache) has a couple posts on 50k/yr jobs that don't require a degree as well. Look that up. The time you spend doing this will be well spent and will position you much better for RE investing than almost any other action. You are young- be open to moving out of your town to where those jobs are. Keep your expenses low, read, listen to podcasts, and look at properties in the mean time. Very quickly it will all add up to proper preparation and the knowledge and money to take action!

Also you might be able to add a 2nd floor if the footing can support it, if it's a problem of not enough square footage...that may be cheaper than a tear down but probably not if it is really old or in bad shape...

Kris...sorry for the mis-spelling...

Kris Haskins Hi Chris, $6500 is on the higher end for 800sf with no basement. On the south side I would expect closer 4k unless there were some access issues or lots of asbestos.

Jeff Rabinowitz consider using different deposit accounts to minimize confusion. A single bank can establish several accounts for your business entity.

Originally posted by @Christopher Fougere:

Money is cheap now.  It won't always be.

I'm one of the lucky ones who likes his job and wants to continue working, so I will likely continue to buy leveraged properties as soon as capital frees up, the more properties added the faster this happens.

 I'd be happy to eventually find a job that I liked and wanted to continue with...that just isn't the case now and I believe a break in employment, if that is all that it ends up being, won't be that big of a deal...

deleted since I already replied and didn't notice I wasn't on the most recent page of comments....there should be a way to delete these mistakes....

@Eddie T. not to overtake this OP's original discussion but that is one beautiful roof!  How many squares? Having a simple rectangle roof can really keep the costs down on a metal roof as well.