All Forum Posts by: George Skidis

In Illinois buying each property in its own land trust is the smart move. Look into using land trusts in the states you want. In Illinois a Land Trust has no annual fee. A land trust is not liability protection. When set up properly they provide anonymity and avoid probate. That is the benefit.

Buy liability insurance on each property of no less than $500,000 per occurrence. Then buy a commercial umbrella liability policy for no less than $1,000,000.00 but feel free to get more.

Long distance property management takes experience. You might consider starting in your own state. I have heard a ton of horror stories about hiring an out of state property manager. Figure they are half true and half new investors not understanding the risks involved. The Gurus only talk about the millions to be made not the headaches along the way.

Each LLC requires an annual fee. In Illinois 10 Domestic LLC's would cost $750 per year. Not including any federal and state income tax returns or out of state foreign entity registration fees. You can go broke trying to protect your investments.

The best liability protection is staying current on maintenance. Fix those steps or whatever else is needed.

My personal choice is to own everything in an "Illinois Land Trust". The beneficial interest of the land trust is an entity you control like an LLC, S Corp, C Corp or another trust. Manage all of your properties with one LLC. The LLC owns nothing, but the company check book. A single member LLC tracks back to your tax return and you could be sued personally. A multi member LLC can be a standalone target in a lawsuit. It can also choose to be taxed as a partnership, S Corp or C corp. You can still be sued personally for negligence, but it takes an additional step or two.

Caution on obtaining a tax ID number. Unless it is set up as a sole proprietor you will need to file a tax return the very next season even if you haven't started the business yet. The late filing penalties for entiries is over$200 per month per member.

Own your personal residence in a Land Trust. IF your lender has a problem with that refer them to the 1984 Garn St Germaine act that allows this for "Estate Planning Purposes".

Own your vehicles in a personal property trust.

Own nothing in your name.

Always consult an attorney who specializes in what you want done. Never hire a traffic attorney to handle a murder investigation. If you need an attorney PM me and I will give you a referral.

Check out the Springfield Area Landlords Association (SALA)

How many annual fees do you want to pay? Il LLC franchise tax. Texas LLC franchise tax. IL LLC tax return, Texas LLC tax return. Plus filing a Texas LLC as a foreign entity in Illinois fee, or filing an Illinois LLC as a foreign entity in Texas fee.

Abandon Chicago and look at Southern Illinois. Marion, IL is a great place and prosperity is rolling in. New VA Hospital, upgraded regional airport, Southern Illinois University at Carbondale, Logan College of Chiropractic and much more. There is a Casino in Carterville that is bringing in live entertainment that us seniors enjoy. Acts like Crystal Cayle and so many more. Congressman Mike Bost has done a lot for Southern Illinois. Plus, our Chapter of National REIA, Illinois REIA, is now getting very limited access to some federal foreclosures.

One of the members of Illinois REIA is a very successful real estate agent. Alyssia Bunting has offices in Marion, Herrin and other cities in Southern Illinois.

I would not recommend anything much farther north than Springfield our state Capital

In Cincinatti check out Queen City REIA.

As a former claims adjuster nobody ever called me to their home to tell me how great things were. When it comes to roofing their were several causes of interior leaks. First and foremost anything that puts a screw or a whole in a perfectly good roof will eventually leak. My favorite example is installing a skylight. They look great, but will eventually leak or get foggy maybe both. Flashing around chimneys, vent pipes or any other penetration in the roof needs regular maintenance, or they leak. 

So you want to put 225+ screw holes in the roof of your home. Why. Do you have a detached garage? Could you build a pergola to sit under in the summer sun?

In my opinion solar is being oversold based on the ROI. By the time you get it paid for you will need to start replacing panels. What happens when you need a new roof that is not covered by insurance?

Have you had an energy audit? The best first  course of action is to see where you are bleeding energy. Is there enough insulation in the attic? How old are the windows, are they thermal windows? How about your water heater? Is it a 20 year old low efficiency 50 gallon tank that runs 24/7? Have you looked into a tankless water heater? We installed one in the wife's beauty shop in 2010. After the install we noticed the utility bill dropped $60 a month. It is still working today. Also have a tankless in my personal residence. It seems like endless hot water would be a blessing when you have 4 or more roomers in your home.

Step 1 perform an energy audit and see where it takes you. 

If you are house hacking, that means you are not planning on staying in the house. Do you really want to drop $20 to $30 thousand dollars of your own money to gift it to someone else. The house will only sell for what it is appraised for.

Good Luck and Good Investing

Even with the birthrate being what it is and people moving into Illinois for jobs, the state has lost about 500,000 residents in the last 10 years.

With self-deportation, ICE raids and OUTRAGEOUS tax increases Illinois is going down the wrong path. The incessant gerrymandering by democrats is ensuring Illinois will never recover. Yes, apparently it is OK to gerrymander when Illinois Democrats do it but not when Texas Republicans propose it.

The mayor of Chicago wants to pass an entering the city tax. We have an automatic gasoline tax increase that is tied to some formula, maybe Cola, maybe inflation but gasoline can be up to fifty cents a gallon cheaper across the state line in Missouri, Kentucky, Indiana or wherever.

In the State of Illinois only owner occupants can work on the plumbing. 

I would never buy an investment property in the city of Belleville because of the local Code Enforcement. Unless you are an owner occupant you and your crew CANNOT do any of the electrical, HVAC, roofing or almost anything else without obtaining a city license. There is a different permit and fee for anything you might want to improve. That may be one of the reasons the city is getting run down.

So, I would not recommend investing in Illinois. But if you are set on it buy me out.

 im not sure why it shows STL, this property is in Southern Illinois 

For those of you who are new to Bigger Pockets. BP identifies properties in Southern Illinois as being in Saint Louis. According to BP if it is not in Chicago, it is not in Illinois. 

This is the same treatment we get from our Governor and legislature in general. 

Your post mentions Illinois, but not where you are or what city the property is in Illinois. Fill out your profile for maximum help. If you are dealing with this long distance it will be even harder.

Nobody "buys houses cash as is" to lose money. If that happens to often, they are out of the business. Those LLCs are in the business of buying houses at a deep discount. Their goal is to spend as little as possible to reap maximum profits.

It was just reported that there are half a million more homes on the market than buyers. This is due to high interest rates, financial uncertainty based on fake news, social media and other factors. It is becoming a Buyer's Market. That means they price will soon be discounted even more by a cash buyer.

They want to buy it from you for less than you have invested. They plan on you being a "Sick of it all Don't Want-er" and giving away the farm.

Why can't you be the resident, landlord or the "Flipper"? Join your local REIA, get some ideas, fix it up and deal with it.

Option #1: Rent it out. Make sure to get it insured properly. Unless the place is trashed, this takes the minimum expenditure to meet local codes.

Option #2: Sell on a lease purchase agreement or rent to own. Get the price you want, Get 20% down, and earn 8 to 12 percent interest on the loan made with your equity. This is not a sale yet and as such it should not violate any mortgage or due on sale clauses. Notice I said rent to own and not bond for deed. Bond for deed can give the buyer instant equity and it is no longer an eviction but a foreclosure. Make sure it is properly insured and check with your attorney on how to do this. 

Option #3: List it on MLS. You can normally find a real estate agent at your local REIA. Talk to other members and see who they recommend.

Option #4: Live in it yourself. If you own another home that you live in, consider selling it. Then move into this one. If you have lived in your current home for more than two out of the last five years you can get up to a $250,000 capital gains income tax deduction per spouse on the sale. So, if you are married that is up to $500,000 in tax free capital gains. Sell the first home and then live in this one for two to three years and try again.

The first rule of real estate investing is to make a profit. That always means having an exit strategy.

Land Trusts are a state contract. Not all states recognize them. Florida has their own version. Guy named Warda has written several books that are state specific.

Your profile appears brand new. You might try filling it out so others can figure out who they are talking too. Buying in TN does not mean you live in TN. You could live in AZ or IL. The more detailed you are in your profile the more likely you are to get more exact responses in the future.

Feel free to PM me about an attorney.