All Forum Posts by: David Lilley

They can apply to any purchase contract.

Look into holding the property as tenants in common. You and your brother will both create an LLC for yourself. Then, you will purchase the property as tenants in common (your LLC and your brothers LLC will share ownership). This way if you want to do a 1031 exchange in the future you can take your individual profit and buy whatever you want and your brother can do the same.

You could also say cap rate is the return on your investment if you would have bought the asset with cash. :)

@Melissa McGuire if I were you I would start reaching out to brokers. Start with loopnet and find the brokers offering those 5+ million dollar properties. Call them. Tell them what you can do for their clients and find out what you need to do ($$$?) to become their preferred lender.

I can't comment on the purchase itself without seeing the financials but the plan is safe. However, all that extra money over a 20% down payment could have been used to put 20% down on a larger property. Vacancy hurts a lot less the more units you have and more rents support paying for a property manager. If you really want to retire soon this is the model you want to pursue. Nothing wrong with the safe play. Get your feet wet and reevaluate the level of risk you are willing to tolerate. Also, make sure you are renovating to the standard of your potential tenant (D and C class tenants don't need granite counter tops).

@Jeff QuintanillaIf you want some acres I would look a bit East in Sachse and Wylie and preferably a bit North in Mckinney/Anna/Melissa area. For 200k or below look in Anna and Melissa.

I echo what @Bryan Hancock suggested. I found Gene's book to have zero valuable insight and instead just defined what an LLC, LP, GP, etc. were.

Your attorney/agent should have had that written into the contract. All deposits should transfer to new owner and all rents should be prorated day of close.

@Jen Hoang I would suggest talking to a 1031 expert / real estate attorney but one way is for the title to the property be held as tenants in common. Your LLC and his LLC. Then, when you sell you can choose what to do with your half be it 1031 exchange or not.

Valid point. To encourage energy conservation, include some wording in the lease that says something like, if you use more than this amount then you will be responsible for the overage.