All Forum Posts by: Dillon Loomis

Hey gang. 

I'm going to be a duplex/triplex, buy and hold investor. I'm not setting up an LLC right out of the gate, as I don't have any assets to protect just yet.

I'm going to own the properties in my name, and establish two business accounts at a bank separate from my personal accounts. One escrow account for security deposits and another account for ongoing transactions. 

Down the road, when I have profits, if I want to take a portion out of my business account and transfer to my personal account (take a draw)...what is the best way to do so?

I've heard once a month is best. Are there any rules/regulations? Where does "commingling" of funds come into play? What is the best way to track this?

Any guidance would be great, thanks!

@Austin Hughes Hey brother, hang in there. Sometimes God lets us walk through storms to test our faith and our perseverance. The cool thing is, the more broken we become, the more His power can work in us. Think of it like a slingshot. He pulls us back, and the further He pulls us back the more painful it becomes. BUT, when the time comes and He releases He springs us forward into completely new realms and better things. The key is letting Him. 

For me, faith is #1. When that aspect is off for me, my life is off. I think differently, act differently, and make decisions in a different fashion. My advice is to read the gospels, pray, and set up a meeting with either a pastor you know or a good Christian friend you can confide in. It may take a bit of time for your heart to soften but if you seek God first above all else, He will reveal Himself to you. 

Proverbs 3:6 "In all your ways acknowledge Him, And He will make your paths straight."

Matthew 7:7 "Ask and it will be given to you; seek and you will find; knock and the door will be opened to you."

God is good, all the time. Stay patient, and you will see His glory through the hard times. 

Romans 8:28 "And we know that in all things God works for the good OF THOSE WHO LOVE HIM, who have been called according to his purpose."

@Michaela G. thank you for the reply!

Throwing another question out there:

During closing...is title insurance automatically added in (as determined by the lender)? And thus you don't need to specifically state that you want it?

Or is it something that as the buyer you need to state that you want, and then proceed to choose which coverage you want? Do they give you different options or is it up to the buyer to specify? Thanks!

@Matthew Sutton What's up my man! Fancy seeing you on here :)

After reading this post, I've realized we are in VERY similar situations and have very similar goals. We should definitely get in touch and stay in touch. I've been researching endlessly the past few months, but am really trying to be patient right now and put myself in a very solid financial position (while living at home) before I make a move. 

I've read frequently about people being too eager to purchase their first property, and do so without proper cash reserves. I've learned that living at home is truly a blessing (if not being charged rent), and the more money you put towards your loans and your reserves now, the better off you will be.

Personally, I plan to use an FHA loan to purchase a MFH by the end of 2016, beginning of 2017. I plan to live in one unit, and rent the other unit(s) out, and proceed from there. The goal is to have AT LEAST $15k in cash available for RE purposes only. About $5k will go into the 3.5% down payment with FHA and then will hopefully set up a sellers assist and not have to pay closing costs with cash, leaving me with between $5k-$10k in reserves after purchasing the property, along with $20,000 in available credit (worst case scenario).

I guess what I'm getting at is...I'm pumped to see you on here and try to stay patient. Learn as much as possible, develop some great contacts, determine what your niche will be (style of investing), set some goals, and continuously improve your financial situation. Talk soon.

Hey guys!

End of 2016 I will be purchasing a duplex/triplex, owner-occupied, using an FHA loan.

I met with my CPA (new relationship) and he recommended starting an LLC as my plan is to own multiple rental properties (buy and hold) over the next few years. However, after reading posts and posts here on the topic, I'm leaning towards waiting on the LLC. I really don't have any assets to protect right now!

Question is: can you even have an FHA loan in an LLC? I'm already planning on NOT setting up the LLC for this first property...but hypothetically would this even be possible? I have heard some lenders give push back to attempting this, but it is straight out not allowed or just harder to acquire these types of loans?

Thanks!

IMHO using LLC's for each property does not make much sense unless you have large amounts of equity in your properties. The main reason is the tax headache having multiple LLC's will create and the costs you will incur come tax time. The best way to decide is determining what you are trying to protect. If you have a high net worth and a lot of personal property that you want to protect, then you could consider it. If you are just starting out, with say a MFH owner-occupied, it does not seem necessary to create an LLC. Just ensure you have separate bank accounts for all business transactions and an escrow account to hold security deposits. In the grand scheme of things if you are a good manager of follow the rules and truly try to do well for your tenants, being sued should not be a major concern if you screen your tenants thoroughly. If you only have a couple thousand bucks in a savings account and don't own any properties of your own yet, it just seems like there isn't much to really protect in the first place, thus rendering an LLC useless.

However, I have heard there could be some tax benefits from establishing an LLC which I'm going to look into. If anyone agrees/disagrees with me, I'd love some input from an experienced investor!

Also, just throwing this out there...I love this community! 

I know seller concessions will be greatly dependent on the market (supply/demand), but I'm wondering if anyone has any tips/strategies to arrange a seller concession. 

If anyone has exposure to the Erie market, I'm curious as to the likelihood of obtaining seller concessions with the current market. 

Is this something that is typically negotiated through a realtor? Any insight would be great!

@JERMAINE LUCAS Thank you very much for your input!

@Sara N. Great input, thank you for that!

I would like to hear some opinions on and experience with lease agreements. Having a real estate attorney draft one for you vs. creating your own online or with a program or software. 

And then perhaps pros/cons for each? I'm not sure if I should find a local attorney to work with (and pay) or if I could do the research and find a template from a resource on BP and then add in my own clauses. 

Thanks!