All Forum Posts by: Don Hines

I gave you a vote Tony. That is the way I was taught about life insurance too.
Don

I appreciate you sharing. A good reminder.
Don

Chris
You have already been advised by the best here....but, it appears you may be getting your cart before your horse. LLC's are great. But, you night be spending time on establishing it in place of aquiring your first deal. I intend to have an LLC established before too long my self. But, I want to learn all I can while actually doing "it". There are some threads on BP that advises when LLC's are in order. If I talked to my CPA before I did stuff, he would advise against everything I want to do. I hope not all CPA's act the same; but, mine rejoices when I have a bunch of deductions. They represent losses to me which may lower my taxes. But, at this stage of my game, the more taxes I pay, the more money I have made.
I don't know what the ratio is for my offers versus deals. I have made over 40 since August and have yet to score. I know I have missed a few deals by a few $hundreds$. It has tried my confidence in my self. I get annalis paralasis all of the time. As J Scott sez, I know the area well. I have learned how to comp a particular listing. To get a veiwing, I size the listing up in my spread sheet that will calculate the comps, soft cost, and I throw $20k at the rehab. If this calculates an offer that is within 80% of asking, then I tell my buyer's agent I am interested in a veiwing. After veiwing, I actually plug in my rehab estimates to calculate an offer.
This is my system today. Like I said, I haven't been very successful in making a deal. I think I could be out of line with my repair estimates. So, I research daily to learn more about the offer.
BTW...One reason I make so few offers is because my real job gets pretty demanding at times.
Don

AMEN

What???
I will give you the same answer I give my accountant when he cries about me paying taxes. The more money I make, the more taxes I am going to pay. Ain't that great?? Are you suggesting now whole life investments are sheilded from taxes? Should I not invest in real investments so I will not make any money? I wished I was smart enough to keep my money instead of paying taxes on it. But, putting it in places where there is no return is not an option in my opinion.
Don

I got into a major sheetrock job a couple of years ago that was beyond my talents. I searched Angie's list and was not satisfied. I haven't been into a project that major since. But, I have hundreds of names and numbers from contractors that I have accumalated while shopping at Home Depot. Be there early in the morning and you can pretty well size them up by their crews and equipment. Our local REI club is a good source too.
Don

I agree Bill. It has been so long since I shopped insurance. Maybe I am real old school when it comes to this subject.
I have always considered when I go make a loan, it will decrease as I make payments. I really don't need to be covered for $100k when I have paid it down to ??? (pick a number less than $100k here). It cost so much more to maintain $100k in coverage when I might only need $50k in 10 years. If the term policy cost me $20 a month and the whole life cost $100, I can think of a bunch of investments for the $80 that would earn more, and I wouldn't have to borrow it from my self. I didn't see where anyone mentioned that if you do borrow from the whole life policy, the benefit decreases by that amount until it is paid back. Again, why would I want to borrow from my self. That just makes me mad!!
Don

I don't see where that is revalant for many reasons...
1. If we decided we needed $1million in coverage while starting out, I promise you I would never agree to pay the difference between whole life and term.The partnership would desolve right there.
2. If you hadn't agreed to sell out when the offers first started coming in, I would have bought you out before you died.
3. With all due respect, if your wife and kids were really that wreckless, they could be bought out for less than $5 million. They probably would have started depleting the personal assets first then started bugging me. I hope that is not the case. Hopefully, we have a relationship that is nuturing. If we made it as partners for 10 years, I would have already made plans for something like this. I have seen these situations swing both ways.
4.If our business is indeed growing to a value of $10million, we would have been adding to our insurance portfolio as needed. And, it would also be the less expensive term. Even though I am now worth $5million I will still be frugal.

Paul
I have been pounding the pavement chasing after REO's and haven't had an offer accepted in the last couple of months. I have learned that I missed some by just a few $$$$. But, never offer more than your projections. Some one driving the price up with their bids could be owner occupants that don't need the spreads you do.
Good Luck
Don

Kevin
In 10 years and one day, if we have been investing the difference between whole life and term, I would have the difference of what ever 3% (at most) the whole life policy has earned and what we made investing the difference in (name it here) plus the renewed benefits from the term policy. And I would not have to borrow from my self to buy out the heirs. Wouldn't we be self insured by now anyway?
I don't know what insurance cost these days. I havn't added to my personal policy in 20 years or better. So tell me, How much is $100k of 10 year guaranteed renewable term versus $100k of whole life? How much will I spend on each for the 10 years. I am willing to bet that the second term of the term policy is still less than the whole life. My own personal policy has renewed twice since I bought it. The last time the option rolled around, I chose to allow it to decrease until I am 96 or 100 (can't remember which). I will still have more term in my old age than what I could afford to pay for whole life when I initially purchased this policy
I need more insurance when I am younger. Not when I am older and the kids have moved off, mortgage is closer to being paid off ETC.

The second part of your question about your heirs....
If they are not part of the business, you and I would have already had that settled long ago if we were partners; or we would not have been partners so long.
Don