All Forum Posts by: Frank Woodin

I am looking for a good Real Estate and Asset Protection Lawyer Near Chicago, if anyone knows of someone they have used or could recommend I would greatly appreciate it!

 Marci,

I use a lease I got from my attorney, since I figure they are going to have to defend it in court it would be best to use theirs.   I would not use the Chicago Lease since Chicago can be a big pain in the rear on the minute details.  You can see my comments on this in a previous post from a month ago on this thread.  The City of Chicago is an animal onto itself and I would only use that lease if I were in the city.  One of the biggest caveats is that you have to pay interest on any security deposit in the City of Chicago, it could as small as a dollar and if you don't send it out on time every time as stipulated in the Chicago Residential Landlord Tenant Ordinance you could be sued for double the security deposit, and this happens all the time in the city.

I had a similar problem in the past and I gave my new tenant a 18 month lease to get them back into the spring/early summer time.  My best time frame would be April/May/June for me.  It's warmer and people are getting active again.  Since I am in an area that contends with winter I would suggest you look at the same time frame to have all your leases end.

Most banks I have dealt with (I am not from the eastern seaboard) want you to use a commercial loan to put it in the name of the LLC. I would start by just calling up banks and explaining what you want to do and go from there, you will probably have to explain what you are doing a lot since what we do is the minority of buyers and seller in the market that they come across.

The quickest way to find a HML is to just google it with the city name you are looking for. You will find there are many different options, some local and some national. Just be careful of the details and the terms, they can vary greatly from one lender to another.

A PML is typically someone you have a relationship with who trusts you with their money in your real estate deal. Some of these people are obvious (doctors, lawyers, business owners) others are not, (someone who is nearing retirement and has a self directed IRA with a lot of money in it and doesn't want to go into a CD or stay in the stock market). The key is to network the hell out of yourself and talk to everyone about your real estate business, the more excited you are and professional you will be surprised on who asks you to invest with you in your deals. I have also used the technique of asking them if they know of someone who would be interested in being a equity partner on a RE deal I was looking at. That way it takes the pressure off them to turn you down and if they are interested they will jump in. The key here is to network all the time and make sure you are worth someone's hard earned money being put at risk (even if it is a potentially low risk deal)

Also weigh the option of firing them vs. what they are costing you to run the property.  If it only costs $735 to get rid of a problem, which most likely will annoy your tenants because most likely they will not be responsive to a tenant call either, I say pull the trigger and fire them.  To me $735 is a small price to pay to get rid of a problem that could possibly cost you a good tenant.  Also if you are going to self manage after that look at how much you will be saving on their fee as well.

My experience is that they want to see the income from the property you will be moving from in the form of signed leases.  They will also want to see that you have access to a minimum of 6 months of mortgage, insurance and taxes so if you are vacant you don't immediately go into foreclosure.   

I did this a few years ago and as long as I could show income from the previous property it was no problem getting another mortgage for my next place.

With engineered hardwood it is usually you pay for what you get.  The flooring that I have put down that was engineered hardwood in the past was not cheap but it is a great product because it withstands humidity much better than just solid hardwood floors.  I would venture a guess that your flooring was cheap because it's not that durable.  What material is the top wood?

Usually rent to own is an agreement on a sale price when you sign your lease with the property owner.  The property owner will "credit" you a certain amount of your rent each month that can be used as a down payment when you purchase the house from the property owner.  The title in case of a rent to own situation stays with the property owner or landlord.  It is a hybrid of renting the property with the intention to purchase in the future usually with a previously agreed upon price.  So you might get a "credit" of $200.00 per month that you can use as part or the whole down payment at the time of your agreed upon purchase.  So in two years you would have "saved" via the monthly credits $4800.00 that could be used as a whole or partial down payment on the purchase of the property.

Seller financing you (the buyer) actually purchase the house from the owner and pay the owner as you would a bank (if they carry the full purchase price).  Usually (but not always) is seller financing at a higher rate than a normal mortgage would be.  The title will transfer to you (the buyer) at the close.

The main distinction is that in rent to own you don't technically own the property if you are the rent to own renter and in seller financing you own the property as soon as you close on it like any normal house purchase would happen.

Hope this helps! 

Kyle,

This is no offense to most real estate agents (especially those not on this site) but they have no clue about RE investing for about 99% of the RE agent population.  If you do work in a brokerage you will learn some things about RE but most of it will be retail real estate to Mr and Mrs Joe Homeowner.  It might still be worth going to a larger brokerage so that you can get some more exposure to potential investments and potentially an investor broker.  You could also keep looking for a great investment and plan on learning the ropes on your first flip with you father.  You will learn more about the industry and what you are trying to get into by doing that than working 40 hours in a brokerage for years.  I learned all of what I know by doing projects and not by working in an office.

Hope that helps, just my two cents.

Good Luck, you are starting at a great time your life, you have a long time horizon and can take advantage of several RE cycles over your lifetime as well.