All Forum Posts by: Denver McClure

Absolutely agree! I see the same comments from prospective and active investment clients. It's even more common when family/friends see your success in real estate and think they can easily replicate that. I have the "get your personal finances together" conversation several times a week these days. As @Logan McKay Zylstra said, listen to personal finance podcasts to get stated. It never hurts to talk to a few Investment Advisors and Financial Planners (who understand real estate investing) to get a second opinion.

Hey @Kaiya Sherriff, as an experienced real estate investor and Investment Advisor, I can truthfully say the answer is both! I'm currently live in my second house hack, and it's by far the easiest way for you to get started in real estate. However, you need to be diversified across all of your investments. A Roth IRA only takes $6,000 a year to max out, and as @Travis Timmons stated, it grows tax free until you retire at 59. This would be the only retirement account I'd suggest you fund while you save for a house hack. 

You also mentioned a brokerage account. A little known secret among real estate investors is the ability to use a Margin Loan against your brokerage account. You'll find that access to low cost capital is a MUST to grow your real estate portfolio. Well, if you invest into an Individual Taxable account, you'll have the ability to borrow up to 50% of you account value without selling and funds/stocks/bonds/etc. Plus the rate to borrow is extremely low compared to hard money. Interactive Brokers has a fantastic comparison on the cost of Margin Loan rates across multiple brokers. 

Ideally, you could design a portfolio that acts as you own lending account for real estate. You account can grow in size and produce enough cash flow to cover the cost of a Margin Loan if needed. I build that exact strategy all the time for my clients, and personally use it myself. It's pretty cool once you sit down and think about it!

Hey @Mario Martinez, I would use HNG CPAs, they have several real estate investors as clients, including myself. They are based out of Mckinney, TX and are very responsive. 

@Jay Oca, I would use HNG CPAs, they have several real estate investors as clients, including myself. 

 Well Margin Loans are not tied to your house/property values, only to Individual/Joint Taxable accounts. These types of loans don't have the same requirements as conventional loans or HELOCs, so it's much easier to get. I would suggest you roll your cash flow or employment income into a taxable investment account, then use a Margin loan against your portfolio to do more deals. 

Hi @Lynn Harrison! I would consider using a Margin Loan (sometimes called Margin Line of Credit). You can access the loans if you have an Individual or Joint Taxable Investment account. Most of the time, the brokerage will allow you to borrow between 25-50% of your investment account value in cash, without selling any of your assets. You can use the Margin loan to help with down payments or renovation costs. It's a strategy I've used on my personal flips, and one that I build for my clients often. Interactive brokers has a good comparison on the current Margin Interest rates between multiple brokers. Right now you can get Margin Loans around 2-10% depending on the brokerage you use. 

Feel free to PM me if you want if you have any questions. Happy to help!

Hey @Reden Dionisio, I just checked at a few banks and credit unions. I'm seeing anywhere between 7-10% for personal loans right now. How much you'll be able to get will really depend on your credit and income. I would suggest using a Margin Loan first if you have an Individual or Joint Taxable account. These are commonly called brokerage accounts, but are simply non-retirement investment accounts. If you do have one, you can speak to the brokerage about their Margin Interest Rates. I use Interactive Brokers for my clients and myself often. Rates are usually in the 1.5-2.5% range, depending on your portfolio size. 

@Adam Terry Same rules and strategy would apply as an individual. I'd suggest looking at a few brokerages first to compare Margin Rates before using a Margin loan. Here's a comparison done by Interactive Brokers. You can always transfer your Individual taxable account from one brokerage to another yourself, or have an advisor do it for you. Happy to help if needed. 

@Adam Terry Do you have an individual or joint taxable brokerage account? If so, you could get a Margin loan (line of credit) against your investment portfolio. A Margin Loan does not require a credit score so you won't need to worry about that. It's a strategy I've used myself and one I've created for clients to help get into more investment properties or complete renovations. 

 Hey @Joseph Barthelemy, I've invested in multifamily properties across Dallas, and I can honestly say you'll do just fine investing here if you can get your hands on a deal! Feel free to message me and we can set up time to talk about the area. Always happy to help!