SFR in Butler County, OH

5 Replies

Hello All, I have been browsing these blogs and posts for a week or two, and this is my first post. I am considering a turn key 1900 square foot SFR in Middletown for apprx $150K. I plan a 20% down payment and https://www.apple.com/iphone-6/tips/expect to rent it for $1400/mo, with 8% pm fees. I have recently formed my own LLC but have received new advice that it may not be needed and using my umbrella would be a better option.

Any advice, suggestions or comments are welcome.

@Paul Post the LLC does two things for you in my opinion: it offers some legal protection and it shows that you are a professional and you are serious. The latter is the bigger one in my opinion. As for the legal protection what the LLC does set up and operated (!) correctley it limits the impact of a potential law suit to the asset the LLC owns. In other words they dont get to take your home and your car and your 401k. (as always please consult with your lawyer, I am no expert).

Your first line of defense is your landlord insurance policy you carry on your rental property. If that get's breached than your umbrella becomes your second line of defense, usually up to 1 million USD. After that your LLC will be your last line of defense. So I would recommend both, the umbrella and the LLC.

The best protection against lawsuits is to do everything correctley. Make sure you follow all legal requirements, practice good business, communicate well and make sure your homes are safe. If you do that you may never get sued.

Medium bluedenube logo op3Marcus Auerbach, Blue Danube Properties LLC | [email protected] | 262 671 6868 | http://www.bluedanubeproperties.com | WI Agent # 82189

Welcome to BP!

California LLC costs about $800 a year to renew. You may have trouble creating cash flow / long term value with this extra expense. I agree with Marcus that your insurance is a much more important piece in your defensive repertoire. I currently own my rentals under my own name with $1M liability insurance on each. My insurance agent says umbrella only becomes necessary when you carry too much liability across individual houses.

Greetings,

Thank you for your thoughts regarding the use of an LLC & Umbrella coverage.

Any thoughts on real estate in Butler County, OH in general, and the deal I am working on specifically?

Thanks you.

I like properties that I can buy at 75 times the monthly rent.  If I can borrow at less than 5% I will pay a little more.  I know some parts of the country won't support those numbers.

Good Luck.

Bill

Greetings,

Thank you for your thoughts regarding the use of an LLC & Umbrella coverage.

Any thoughts on real estate in Butler County, OH in general, and the deal I am working on specifically?

Thanks you.

Thank you Bill, for your thoughts. Since I have another full time gig, I am ok with paying a premium for a turn key property. Also, would prefer an A or B type of property for the same reason. Curious what area, and what condition are you managing to find props that meet your criteria.