All Forum Posts by: Cliff Benner

How are you calculating the ARV for this? Is it treated as 2 houses or 1?

I don't think I remember something like that.

Feel Free to reach out to me, I have an Income Statement Template I built for people that should help out enough until you want to get on a software to have it track for you. 

 Of course!

Let's connect and let me know if you have any questions.

I am in a similar situation in MT. Curious what others say.

Honestly, for a great online resource would be https://www.accountingcoach.com/. This matches the curriculum of my first couple Accounting courses I took in college. 

It is nice you know the software but the concepts are more important to know than the software, so you can read the financials to find what is wrong. Like how to properly calculate basis and why it is not just the purchase price of a property and why land needs a value, how to calculate gain on the sale of a Long Term Asset vs a flip. 

Never stop learning, if you like the subject take on the knowledge, if you can manage a rehab and the books properly you could save quite a bit of money for you and a possible investor. Or you can set up a nice side gig. 

I have a Masters in Accounting and 9 years of experience. I charge $75/hour for my services, which is actually low in this market for what I offer. I estimate to charge $100/hour in the next 5 years and higher going forward due to the industry having an increasing negative replacement % of personnel, even as AI and Tech creep into the market. Knowing how taxes work for real estate will help you know how things should be set up and prepared and why each Parent LLC needs its own QBO Subscription and why you need to have the Class feature for 2+ properties. Find out the difference between a Bookkeeper and an Accountant and identify what you want to be/offer, and communicate that properly. I have some clients that all I do is Bookkeeping for and at my rate, it is pretty high for a Bookkeeper, but they wanted my knowledge and are ok with that cost.

 Lauren has amazing advice here! You will need at Least an Accountant and a Lawyer on your team to help with a business purchase. A seller financing deal is always preferable, since you can close quicker and have more say in the terms. A book that talks about the steps and what to expect is, Buy Then Build - Walker Deibel, I bought a business in 4/2023 and used his book for every step and reread it several times. At the same time I was helping a friend by his business using the steps from the books, and I reviewed his financials and created him a Summary of the financials for his reference so he could make a more informed decision. He said he would never have known how to look at the financials, since he was not that familiar with financials and the difference between those and tax returns. 

He went the SBA route and I was able to get Seller Financing, We took 6 weeks while he took 3-4 months. 

I am not a fan of it, as an Accountant, just because it doesn't have a Balance Sheet and doesn't allow Journal Entries, a Balance Sheet is like the Roast in a Pot Roast and without it you don't get the full flavor. Those are features I think are necessary to have an accounting system. It would work fine at making a profit & loss statement that would probably be fine for a personal tax return though. 

I like comment "2" Stephen talked about, I think this is very appropriate for a lot of Investors that want to partner together with funding from each and then control individual LLCs that is owned by them. That is how I set up my P-Ship with my wife and I, so we can just own other LLCs with ease or partner with others through that "Mothership" LLC as Stephen Said. Then you can add in money to the top LLC, split it how you want, then disburse funds down into individual LLCs that you to purchase more real estate with. You will not be able to get loans under your personal name since you'll be buying the property as an LLC but you can get hard money loans and DSCR loans and still get funding that way.

@Leonard Nester where you able to purchase it? What kind of funding did you use?

Sounds like this was a great investment, did you take over operations on the business or hire a manager?