All Forum Posts by: Edward B.

Ah, I see what you were saying now. My apologies. I misread it and alarms in my head started going off.

Rob, I generally pay $100 to $125 for registered agent services in the states I'm in, but I have not bothered to shop around. In all instances, it is with attorneys that I have a relationship with and I believe that there is value in that as well, vice just going to the cheapest route.

@Jay Hinrichs, 

I don't know, but I wasn't invested in LA and leveraged to the hilt. 

My point is that those people would have been fine regardless of whether their property had been paid off or if they had the money in a savings account to pay it off if necessary. Of course, I don't have my money in a savings account but there are liquid uncorrelated assets that you could be investing in vice having your money tied up in a property. The cliche "7 streams of income" comes to mind.

I look forward to the day when I have so much money that I can just pay cash for everything. I bet most of your friends didn't get their by paying cash for everything, though. Rather they did it through intelligent use of various types of leverage, including debt.

@Nicole A., I don't know if that is straight up illegal, but it is definitely not allowed. You need a registered agent so that your entity can be physically served if you get sued. If you do get sued they will realize that you are using a PO Box when you shouldn't be and that will not be good.

I'm in 100% agreement with Thomas here. You can own your properties outright (poor use of capital) or you can own your properties on paper. Honestly when the market tanks what difference does it make if you have 50% equity in the property or that 50% somewhere else. You either have it or you don't. It can be earning 5% in the property or much more somewhere else. And that somewhere else does not have to be more real estate. It may be sacrilegious to say it on this site, but there are other asset classes out there that are not necessarily going to tank if RE does. Be smart people, not scared. Scared money never wins.

@Amber Bennett, yes, because your payments will be lower, but only for deals where you cycle your money (fix and flip, BRRRR, etc.) not buy and hold.

@James McCray, I don't do lease options. I have looked into them and don't understand why people get so high on them. I suppose it is the lack of responsibility that goes along with it since you are not on the hook for anything aside from your option price. I do not like the lack of control, though, too much can go wrong. I would much prefer a Sub2 deal where the property is deeded over to you. Much harder for the seller to go behind your back or for his problems to become your problems. You will be much more vested in the outcome of the deal, though.

In either case you are looking for a distressed seller with a problem you can solve for them by taking over the property. These typically are not sophisticated sellers so trying to explain a lease option and how it benefits them is much harder than "look, deed the property to me and I will give you a little bit of cash and take over the payments for you." I'm sure if you talk to a lease/option guy he would totally disagree, but that is not me. 

@James McCray, yes the bank usually has the option to accelerate the loan if an option on the property is sold. No most people who use this strategy are not worried about it because it rarely, if ever, happens and if it did you would most likely be given the chance to just unwind the position. If you are worried about it then yes looking for those unicorns known as distressed sellers with free and clear properties would be best.

One of the primary differences between a lease/option and owner financing is who holds title. For a lease/option it is the seller. With owner financing it is the buyer.

@Paden Anderson,

Ever heard of a guy named @Jeff Brown? It sounds like you may like some of his strategies. He recommends aggressively paying properties off as part of his overall strategy. I don't necessarily agree with that, but I do like a lot of the other things he does, i.e. notes, EIUL, etc. Google bawldguy and you will find his stuff.

@Paden Anderson, I am in the same camp as Thomas S., but to specifically answer your question it is less expensive but riskier to go to 15 year mortgages as opposed to snow balling. Personally, I would pay the extra interest to have the flexibility associated with the lower payment of the 30 yr. If you switch to 15s you will be locked into that higher payment regardless of whether your financial picture and/or goals change.

BWAHAHAHAHAHAHAHAHA!!!!! 

Wells Fargo flipping houses?! I honestly can't think of anyone less qualified... well, maybe Bank of America ... oh, lordy. That just made my whole day. Thanks!