All Forum Posts by: Chris K.

@David Krulac: not quite. I actually ended up becoming a General Counsel for a company that relocated its HQ to Nashville. So haven't spent much time on BP. :)

Disclaimer: While I’m an attorney licensed to practice in PA, I’m not your attorney. What I wrote above does not create an attorney/client relationship between us. I wrote the above for informational purposes. Do not rely on it for legal advice. Always consult with your attorney before you rely on the above information.

Any reasonable attorney can help with forming an LLC. I would just note that forming an LLC --- especially a single member LLC --- is easy. But when working with true "beginning" investors, what typically takes time is: (1) gathering information from the client; and (2) answering questions that a more experienced client would already know.

All this to say --- the best way to not get ripped off is to learn more. Knowledge is power! 😇

Disclaimer: While I’m an attorney licensed to practice in PA, I’m not your attorney. What I wrote above does not create an attorney/client relationship between us. I wrote the above for informational purposes. Do not rely on it for legal advice. Always consult with your attorney before you rely on the above information.

@Jim Mal

There's a bunch. Feel free to PM me if you need recommendations. 

Disclaimer: While I’m an attorney licensed to practice in PA, I’m not your attorney. What I wrote above does not create an attorney/client relationship between us. I wrote the above for informational purposes. Do not rely on it for legal advice. Always consult with your attorney before you rely on the above information.

@Yacine Rimmo and @Todd Ashley

This is the verbatim excerpt from the said podcast:

Bryce Stewart:
So it was trying and difficult. And the number one point I walked away with was either you have to have somebody who has an insurance certificate that they’re sending to you. Or if you’re having somebody do side work on one of your properties and they’re not an insured contractor because the kind of work that they’re doing is not something that’s insured, you want to have somebody, and talk to your insurance agents about this, you want somebody who has what’s called a workers’ compensation waiver form. It’s them agreeing to not pursue a workers’ comp claim if they happen to be injured. They’re waiving their right to workers’ compensation. So talk to your insurance agent about a workers comp waiver form.
There’s probably some big investors out there right now who tomorrow are having people doing work in their properties who do not have a certificate or it’s somebody’s cousin helping them do demo because they’re doing demolition on a unit and the person doesn’t have adequate medical insurance. Guys, this is so important that I actually wrote a song that I’m going to play for.

Based on what he wrote, I believe he is making the contractors sign something like this: https://grubermotors.com/media...

Essentially the form makes contractors state that they: (1) are independent contractors; (2) don't have workers comp coverage for themselves on the basis that they are owners/sole proprietors; and (3) will not pursue (or acknowledge that they won't receive) workers comp benefit from the owner. 

These forms serve a few purposes. If you actually own a business and have workers comp insurance, your premiums can increase after an annual audit if you don't get the independent contractors to either: (1) provide a COI with workers comp; or (2) sign these waivers. It could also be a way to establish that the contractors in question is an independent contractors versus an employee. But having the contractor sign this form wouldn't be the dispositive issue for whether he or she is an independent contractor. 

Disclaimer: While I’m an attorney licensed to practice in PA, I’m not your attorney. What I wrote above does not create an attorney/client relationship between us. I wrote the above for informational purposes. Do not rely on it for legal advice. Always consult with your attorney before you rely on the above information.

@Yacine Rimmo

That's a separate issue. Your obligation to pay for WC policy and deal with WC claims is whether the person in question is an employee. Now you could try to prevent them being an employee but making them sign an independent contractor agreement of sorts. But ultimately the law doesn't care what the agreement says. The classification between an employee and an independent contractor is governed by Federal and State law. The agreement may nudge situation towards one direction. But what it says on the agreement doesn't actually control their classification. 

There are other kind of waiver forms that would allow the independent contractors from obtaining workers comp for themselves. But that's a different issue. 

Disclaimer: While I’m an attorney licensed to practice in PA, I’m not your attorney. What I wrote above does not create an attorney/client relationship between us. I wrote the above for informational purposes. Do not rely on it for legal advice. Always consult with your attorney before you rely on the above information.

@Yacine Rimmo

Depending on the insurance coverage you have, your insurance carrier might provide a form. Essentially you should have a contract with the contractor and also have him sign this waiver stating that: (1) he/she is an independent contractor; and (2) he/she does not carry WC Insurance as the owner/sole employee of their business. 

But it really depends on why you are doing. I didn't listen to the referenced podcast so I don't know what the idea behind the suggestion was.

Disclaimer: While I’m an attorney licensed to practice in PA, I’m not your attorney. What I wrote above does not create an attorney/client relationship between us. I wrote the above for informational purposes. Do not rely on it for legal advice. Always consult with your attorney before you rely on the above information.

@Chris Smith

If you do a search, you should be able to find past posts by me and other folks on this topic (e.g. @David Krulac). But the short version is that buying at a judicial sale can be risky. It is possible for these sales to divest existing interests. But that requires strict compliance with notice requirements. If the Tax Claim Bureau fails to strictly comply, you will be responsible for dealing with it 99% of the time.  

Also note that you will likely have to do a quiet-title action no matter what. This is so that you can get a marketable title that title companies can insure. Not required but you probably can't sell it or get a mortgage without it. 

The cost of it will depend on the situation. It might be a few thousand dollars as @Kate Daye Ruane mentioned plus fees/costs. But it can end up a lot more if someone contests the action.  

Disclaimer: While I’m an attorney licensed to practice in PA, I’m not your attorney. What I wrote above does not create an attorney/client relationship between us. I wrote the above for informational purposes. Do not rely on it for legal advice. Always consult with your attorney before you rely on the above information.

@Lizbeth Vaquero

If you want to be a real estate nerd (which is not necessarily a requirement for success as investor), that's not really the point of a cap rate. Cap rate means basically nothing as an ROI metric.

For example, let's say you have near mint 100 unit apartment selling at a 7 cap. Should you buy? Well, probably not if you are in Scranton. If it is in NYC, you should run to the seller with the money and contract in hand. 

Disclaimer: While I’m an attorney licensed to practice in PA, I’m not your attorney. What I wrote above does not create an attorney/client relationship between us. I wrote the above for informational purposes. Do not rely on it for legal advice. Always consult with your attorney before you rely on the above information.

Hi @Kyle Knowles:

There are a few of us on here including @Mark Lladas, @Adam Guiffrida, @Marc Winter, etc. 

Disclaimer: While I’m an attorney licensed to practice in PA, I’m not your attorney. What I wrote above does not create an attorney/client relationship between us. I wrote the above for informational purposes. Do not rely on it for legal advice. Always consult with your attorney before you rely on the above information.

@Jeff Lamothe

A few thoughts: 

1. Most tertiary markets like Harrisburg and Scranton/Wilkes-Barre should meet most of your qualifications except maybe number 6. I just don't know what the job growth data in the past 10 years is. 

2. Except for Philadelphia and Allegheny County, most landlord-tenant laws in Pennsylvania is the same. So there's no meaningful differences outside of those two areas. 

3. You should be able to meet the 1% rule in Pennsylvania. Most properties should meet the 2% rule. 

4. I would note that Pennsylvania areas outside of Philadelphia and Pittsburgh rely heavily on cars to get around. For example, my guess is that most people in Luzerne County will have a 20 to 30 minute commute in non-city-traffic to get to work. So you often need to look beyond a specific city limit when you are evaluating a market. 

Disclaimer: While I’m an attorney licensed to practice in PA, I’m not your attorney. What I wrote above does not create an attorney/client relationship between us. I wrote the above for informational purposes. Do not rely on it for legal advice. Always consult with your attorney before you rely on the above information.