All Forum Posts by: Andrei Zamfir

@Michael Ealy

Your partners are very smart people and you are blessed to have them.

The big money is in cash right now. Warren Buffet, Mark Cuban and others.

Gold is at an all time high in 73 countries. Something big is cooking.

@Scott McGuire

Very well said.

@David Ferreras

The LLC can get sued and you individually can get sued (civil suit).

For the civil suit, make sure you have a good umbrella policy. Check to make sure the equity in your personal residence is covered by homestead protection in your state.

For the LLC, the house title should be in the LLC name. Also, the LLC has to be an additional insured on the policy. You have to have separate bank accounts, no mingling funds. Otherwise, it will be grounds for pier ones the corporate veil.

The LLC the owns your property can in turn be owned by a Wyoming LLC. The reason for that is that Wyoming law has charging order protection. In other words, no one can take the LLC from you. If they get a favorable judgement, they can only access funds that you use to pay yourself out of the business. So you stop paying yourself and slap them with a tax bill. They will go away quick.

The vast majority of slip and fall lawyers work on a contingency basis, meaning they do not get paid unless they get something. When they see a WY LLC, they will not bother filing the suit.

@Michael Ealy

First, congrats on your success.

In my opinion, you should unload some of your properties, use the cash to deleverage your other ones and increase your cash flow. Keep the better ones.

When the downturn hits, you will be able to keep your properties because your cash flow is not thin. Just in case there is a sudden and severe drop in rents. Nothing goes up forever.

@Jay Hinrichs

I wish it was not so, but Trump, or any other president, is powerless to stop a recession, especially one that can potentially dwarf the GFC.

He could make it less painful though and let it run its course for a swift resolution, going contrary to Roosevelt’s style in the 30s, which prolonged the Great Depression.

@James C Norman Jr

Phoenix and Vegas were the epicenter of the last downturn. The problems that caused the GFC have not been resolved. They are even bigger today.

Those who say we cannot have another GFC or worst are deceiving themselves and others.

Rents have dropped in the GFC. Not in all areas but in many of them. During a crisis, people get creative, they will live with relatives or friends and rent out their homes. This creates a ton of supply on the market which in turn causes rents to drop.

Nobody knows exactly how this will play out. As long as you use low leverage and cash flow net with a built in cushion to survive a drop in rent of up to 50%, the chance of survival (aka keeping the rentals) is very high.

Wish you all the best. Real estate is great and the best way to build wealth, but only if you can keep it long terms.

@Sadrud-Din Williams

2 reasons in my opinion:

1. There is no other business endeavor where there are some many ways one can be separated from his/her capital through ignorance, incomplete knowledge, dishonesty, impatience and so on.

There are so many blind spots, landmines, at every turn, regardless of one’s strategy.

2. Refusing to spend on education and professional advice.

Real estate is one of the hardest things to do right. Please read Real Estate Investing Gone Bad. It blew my mind.

@Dee Shaun

Scared or cautious. There are still deals to be had, but they have to be stress tested for a possible 50% drop in rents. What good is is having long term rentals if one cannot hold unto them during a downturn. The problem is most people, even real estate investors, completely underestimate the severity of what lies ahead.

Buying a house that ends up cash flowing only $150/mo is a very bad idea in the current environment.

@Tanner Marsey

Even more reason to be cautious. Gold

is at all time highs in 73 countries. Something big is brewing.

@Dee Shaun

We are at or very near a market top. It could very well be a major top. If it is, the correction will be more severe than 2008.

Over leveraged investors will wiped out.

Either find deals at 50% or more discount or save your money and pick them up for 20-40 cents on the dollar in a few years.