@Brandon Turner and @David Greene on your podcasts you talk about BRRRR Strategy, and there was a podcast that David say he does 1~2 deals now a days. I'm curious when you get so many refi's how your credit scores don't take a hit and hinders you from getting a good interest rate (or do you just not care about what the interest rate is as long as you meet the target return?). I've purchased 4 properties (unfortunately not through BRRRR, but through conventional loans) and my credit score seems to have tanked from 800+ to 750ish. Just trying to see what the best way to use leverage going forward is. Thanks for your help!
I am also interested in why LLCs are popular and discussed so much on Bigger Pockets.
My attorney is recommending putting property in a Trust. The title insurance is still valid as the trust takes ownership in my name as trustor. It avoids probate and is easy to pass onto heirs. Separate trusts can reduce liability and are cheap to clone and all of them together would require one tax filing, under my name with my regular taxes. It allows one to offset profit and lose for all assets in one tax filing.
He sees LLCs as vastly more complex than needed and more expensive, management and tax wise.
So, can you explain the difference and what are the benefits/disadvantages of each? I'd like to understand different opinions.
Awe, good question as I am in the same predicament. I prefer Trust but then it's probably because I don't know much about LLC's either. Please let me know what which you decide to choose.
We always listen to you guys ask people about their portfolios, and I'm always curious about the details of your own portfolios-- number of units, types, financing, etc. Would also love to hear what both of your current REI goals are for this year and long term.
Always appreciate a good David Greene cop story if you can fit one in.
I am planning on investing out of state and I have looked in Kentucky and Nevada and have checked property values . What' s the best way to get to know an area out of state. If it is a good area , if its growing or not. Realtors usually will give a rosie picture of the area .
You and David did an episode where someone mentioned that they've got BRRRR down to an 8 week process; could you guys go into greater detail about that? I'd love to streamline the process for such a fast turnover.
@Brandon Turner when is the right time to set up an LLC for your properties? Rehabs, wholesales, and buy and hold. I'm fascinated by your podcasts by the way! I've binged 40+ episodes this passed month alone..
@Estelle Angelinas Awesome question! I would like to hear from someone who started real estate buy/hold investing in their 40s with NO prior knowledge, experience, family connections to REI.
Would also love to hear from more successful female REI guests on that note! 😁
I am an artist and homeowner and am looking to buy another home (duplex?) to use as studio/rental property. I have very little liquid funds for a down payment. This will be in the Los Angeles area. Suggestions?
@Brandon Turner Hello, my High school buddy is Quit claiming a commercial property over to me, OhYea!!, he sold a property and had $120,000 in a 1031 , he used 100,000 of that money as a down payment for the property and currently has a hard money loan which I want to refinance after the quit claim, the remainder in the 1031 is $10k which is the amount he is paying capital gains taxes on. If he quit claims it over to me does he or I pay taxes for quit claiming property over to me. His current home was quit claimed to him from someone who was upside down and losing the home they walked away and he continued making payments on the existing loan. As of today many years later he’s never had an issue, so I’m asking The PROS’s about this before I learn the Hard way.
@Chuck Dangar I would suggest a loan to your business.
Pull money from HELOC
write a check to your business
Secure it with a promissory note (cherry on top I know; since it's from yourself to yourself, but will serve as practice for when you borrow other peoples money)
@Brandon Turner. Can you do more to help large families with tips and advice? Everything from debt repayment to savings to real estate hacking? We have a blended family of 8! I take notes on every podcast where people have 1-4 kids but it would be nice to hear from people with large families on what they've done to become financially free! Our kids range from 17-3!
I am also interested in why LLCs are popular and discussed so much on Bigger Pockets.
My attorney is recommending putting property in a Trust. The title insurance is still valid as the trust takes ownership in my name as trustor. It avoids probate and is easy to pass onto heirs. Separate trusts can reduce liability and are cheap to clone and all of them together would require one tax filing, under my name with my regular taxes. It allows one to offset profit and lose for all assets in one tax filing.
He sees LLCs as vastly more complex than needed and more expensive, management and tax wise.
So, can you explain the difference and what are the benefits/disadvantages of each? I'd like to understand different opinions.
Awe, good question as I am in the same predicament. I prefer Trust but then it's probably because I don't know much about LLC's either. Please let me know what which you decide to choose.
I am almost certain I will be using Trusts. I have my personal homes and an adult disabled daughter's home in a Trust now. I likely will put the rental properties in another Trust. I may set up a third for a 4 unit apartment, (and future assets) that is in escrow now, but might just put it with the other rental properties. For liability I do not want to put the rentals in the same Trust as the homes my family live in.
Its really a personal decision, and I am still seeking input. I don't understand the big push on LLCs on BP, but am trying to read and understand it. Really seems excessive when they also put one house in each LLC and they have pulled out all the equity. Might not ever agree, but do want to understand. Or maybe its great and I am missing something important. That I why I still want to learn.
Part of my decision is also based on having 15 year old kids and being in my late 50s. Most of my dependable relatives are deceased and I have one druggie brother still alive. He would love to seize all my assets if he could. Trusts will protect my assets better for my disabled adult daughter and two teens. LLCs would be something he could spend a lot of time trying to get, and my young kids and disabled daughter would not have the ability to fight him. I am also not seeing the benefit of a LLC. I carry heavy insurance and am NOT a slum lord. I keep things safe and working well, so do not have a high risk. It seems that the benefit of an LLC is risk management, nothing else?
I'd love to hear from more construction side of the investing. People who do ground up or have a background as a general contractor, or people that know the ins and outs of the building trades.