All Forum Posts by: Heather U.

I have 4 rental properties just recently purchased. I jumped in and am just learning as I go. I  know I need to get my tax "stuff" in order and develop a good system to keep track of all of this.  I am a pretty meticulous person so I actually don't mind the task I just don't understand it yet.  For example, as I was getting started I used $1000 of some rental income from one property to pay back a credit card that I had used to pay for living expenses while I was buying another property.  So the credit card expense wasn't related to any property purchases (not directly) but I pulled the money out of one of my property accounts.  I just don't know what to do with that transaction.  Maybe because it wasn't a business expense that I used the money for I just ignore that transaction (in terms of tax purposes?)  So...not really looking for a specific answer to that problem but it is just an example of me needing a down and dirty basic guide on the paperwork side of the rentals.  I have started using STESSA but I need to learn more.  Thanks all, sorry for making this such a long post!!

Thank you all for your help. I am checking into some options based on all of your explanations. Thank you!! 

Thanks so much Patricia.  So is having a house policy with them a stipulation for an umbrella?  

I own 4 rentals recently purchased (with mortgages) and have an umbrella for them. No LLC's. Underwriting came back and has said that since we don't have a car insured with them (our primary house is with them) they can't insure us with the umbrella. For clarification, we live overseas and don't own a car! We have access to my parents car and have a non-owned auto policy for several weeks out of the year while we borrow my parents car. So...my question is....is it possible to get umbrella policy without owning a car or any other way around this situation. Our thought was to have my parents "gift" us the car (somehow the agent said the parents can still have the title) and then we would pay for the insurance for the car but...that costs us $200 every 6 months. Trying to avoid an extra cost. Any ideas?

Thanks Mike. I will have a close look at the chart. 

Joe, because we want the full cash flow in 7 years so we can use that for living expenses when we retire at 55. 🤷🏼‍♀️ Does that make sense? Or is there another way? 

I see lots of discussion and help around getting started but I'm curious to know about everyone's end game plans.  I keep reading about getting started by using the BRRRRRRRR (how many R's?? hee hee)  Method  but for us I'm not so sure this is the best strategy.  Are there different methods that shouldn't be used based on a particular person's financial goals?  

In a nutshell....husband and I are about 48 years old. We'd like to retire in 7 years at 55.  We just started investing the past two years. Ultimately we'd like enough properties with enough cash flow that we can use that cash flow to supplement our income at 55.  Thinking an extra $4000 per month would be great but of course, the more the better. 

It seems using the Brrr strategy here just continues to add mortgages instead of paying down the loans so our cash flow increases. I think the BRRR method seems great for someone younger (or looking to flip). They have time on their side to then spend 20 or 30 years using the cash flow to pay down the mortgages.

We are looking at trying to pay the properties off as quickly as possible but the Brrr method doesn't do that necessarily right?  That method, or I suppose many other creative financing options, helps you to BUY properties but then you need to figure out your time frame for paying them off, if that's your goal. 

So we have currently (all single family)

1) a house we went halfsies on with my parents in Fl. Purpose of this one was not cash flow actually, but more so appreciation. It breaks about even each month and is appreciating nicely.

2) a house that holds an $84000 mortgage and rents at $1170.  Paid $126000

3) a house that we paid for in cash ($128000) and rents at $1190

4) just closing on another house that was $135000 and will rent (assuming) about $1150. This we will likely put 20% down with a conventional 30 year loan.  

5) We have our own home with a $200000 mortgage on that we are currently paying double payments so it will be paid off in 7 years. 

Just  curious to know everyone's plans for paying off their investments (or not.) Still trying to sort out our plans and if it will work.  If we do 30 years loans on these properties and just pay the minimum we would be 78 years old by the time they are paid off! Well that doesn't help us!!!  Did we just get in way too old???  I know our properties aren't showing a huge cash flow but we are at about the 1% mark for them.  We felt that was good considering we are buying from overseas and really needed to  have an awesome P. manager because of that.  So we had to stick to one area.  This area is producing barely one percent returns but we were ok with that.  We just wanted to get started so we could get going on things. 

Thanks all for your comments, critiques, thoughts on this.  Sorry I tend to babble and go in circles trying to explain myself.  I've just always wanted to ask this question as so many podcasts are about getting started, how to find the money to buy the houses etc..but I've only found 1 podcast that addressed actually paying the properties off.  
 

Same question here.  Unfortunately our lender is currently saying 45 to 60 days!! What??? We've got another house accepted offer and want to cash out refi previous property but it will take so long.  Keeping fingers crossed that the cash out can close in time for our next closing. 

Love this post. Thank you!! 

I have paid cash for a $104000 2 bed 1 bath property that  needs $20000 in work to get it rent ready.  It should rent for $1150 or $1200 a month once finished.  After remodel value will be about $130000.  

My property manager came up with an idea to turn it into a 3 bed 2 bath which will cost an extra $20000.  It will then rent for $1300 (maybe $1400 but that might be a stretch.) It will increase the value to $150000.  

Our main goal in buying the property is not equity but to meet the %1 rule and bring in cash flow.  We also want to purchase at least 2 more buy and holds in the next year. 

Would you do the remodel?  To me I am having a hard time justifying spending the extra cash but I am wondering if I am missing something.  We are thinking we'd rather not spend the extra cash on the re-model as it only brings us an extra $100 or so a month which will take us along time to make up the cost of the remodel and we'd rather use that extra $20000 to buy another house. 

Thoughts and advice all welcome please!! Thank you.  We are considering down the road after we have our next houses bought we can go back and upgrade it then. 

Further info....we own one other property worth $130000 with a $80000 mortgage on it at 6%.  We are planning to try (never done this not sure if this works or not) refinance that property along with pulling money out of the second house we paid cash for to use that money for at least two more houses.  Most of our cash is all used up now from paying cash for the second house.