Hi Guys,

By the way, I'd love to connect with everybody from my area, so add me if interested (Detroit Metro Michigan).

So I read through the 8 chapters on the site, and have some questions, that probably have been answered in the thousands of posts around here, so I apologize for my redundancy.

I have 1 rental already which was a conversion from my primary in 2011 when I moved into my new home.  I was viewing it as just getting a renter in there to cover costs, but now I am wanting to start a business and grow wealth over time...that's my goal in a nutshell.  So, first act of business, I am about ready to initiate a refi on it from my 15 year mortgage (11 years left) back out 30 years which will generate 320 a month in cash flow.

But, after calling the credit union and reading the beginners guide, I came up with some questions.

I asked the loan agent how many investment properties I could own.  She said up to 10 free and clear.  She said I can only carry 4 mortgages at a time though.  I have read elsewhere that others have heard this, but then there was discussion that it wasn't true and 4 mortgages through 1 bank only, but then you could go to another bank and get 4 more, and so on and so forth.  Is this true?

And if I owned 10 investment properties outright, and wanted to own an 11th, why couldn't I?  Does some law prevent me from owning 11?  I find that one hard to believe.

If I convert myself into an LLC, couldn't the business own infinite?

I have read about using the other financing options like hard money and such, but what if I just wanted to use 30 year mortgages every time?  Am I limited?

The 50% rule struck me as a surprise, and the real world example wasn't pertaining to SFRs which is what I'm interested in owning for now. In my area for a 100k home, you can't get 2k a month and pay the PITI of 800 on a 20% down 30 year conventional out of half that and have enough cash flow. That rule doesn't seem to work out, and 1000 a month for repairs seems insanely high. On my current rental I probably spend 500 a year on the rental for maintenance, and that's with having to call a plumber or fix the garage door, or do something I can't do (and I'm fairly handy). I put a new driveway in for 3500 2 years ago, so that hurt (with negative cash flow), but unless it's a driveway, furnace, roof, or some odd expensive issue like foundation problems, I would likely not run into a 10k repair.

I was looking around on the local city websites and it is apparent that every city now does 'rental inspections' and 'occupancy inspections', since 2010?  I had never heard of those.  Do you (other investors) try to follow every rule?  I mean, is any house ever really up to code?  I can tell you that my rental was never 'rental inspected' and the rule was in place at the time.  LIke i said, my renters moved in dec of 2010 just after christmas, and I was never contacted or anything by the city, or fined, etc.  

When we bought this home (8 year old home) in late 2010, the rule was also in place, and no occupancy inspection was done.  What is your take on all of these inspections?  Seems like money grabs.  I get that you want to avoid blight in your city, but codes change constantly.  Who would make money if they had to keep up with every code?

Even this home, build in 2003, is now out of code as it doesn't have Eggress, and I"ll be damned if I'm going to add one of those leaky SOB's.  My neighbors have them on their new homes (built after 06) and they all complain of leaks.

When calculating Cash on Cash ROI, the example given in the guide was very simple, 20k down is the investment, take your annual income, subtract PITI and expenses, divide by the 20k and there's your ROI.

But, should I be taking the principal from the mortgage payment and adding that to the investment, since it is going into the property and is technically my investment money still?  Which means, then i'd need to add the yearly interest (i did this with amort schedule, actually did it for 10 years out), and add the yearly principal, and get that calculation.

It's a more detailed calculation, but is it called something other than cash on cash ROI?

I had tax questions up the wazoo while sitting at my cubicle at work today but I can't remember any of them right now! 

I'm starting to assemble a spreadsheet and I'm starting to toy with scenarios, like if I buy a rental every other year for 5 years, then one a year for 5 more years, what's my net worth?  Stuff like that.  That is a lot of fun...

Thanks guys for all of your help.  By the way, for you local investors, the guide said to offer something when starting friendships.  I am a hard worker, and fairly handy, and anal about my work, and am more than willing to lend a hand if needed.  Just sayin...

Thank you much.

Dave