All Forum Posts by: James Schroeder

Investment Info:

Single-family residence buy & hold investment in Lehigh Acres.

Purchase price: $94,000
Cash invested: $5,000

The property isn't currently cash flowing much but I'm ok with that as the house is less than 10 years old. Currently under 1 year lease and might sell to the current tenant.

What made you interested in investing in this type of deal?

Have been wanting to invest in real estate for awhile and all of a sudden our company moved us to North Fort Myers so we decided to rent the house out, though I didn't feel it was really ready.

How did you find this deal and how did you negotiate it?

The property was owned by our company and in 2014 we bought it from them.

How did you finance this deal?

VA loan

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Jack Lewis @ access real estate is great.

I have learned that a lot of problems stem from poor communication, and this problem might mend itself if both of you understood each other. We get some good incite as to what you are thinking but lack incite as to what the agent was thinking. 

Is the agent being greedy by asking for the 2% commission? Maybe he is plan greedy but maybe he is not. Maybe your agents thoughts go something like this, "I've been bending over backward for this guy (you) helping him out going the extra mile for him..... I thought we were unofficial business partners and even though I didn't help with this deal I've help him with everything else and I thought.... 

Bottom line, I think this might be best if you take the guy out for lunch and let him know exactly what you think and where your thoughts are coming from. You will then get an opportunity to hear what his thoughts where and where they were coming from. From this point you can probably make an informed decision as to whether you will pay him.

Last note, I say make sure the talk is productive and you get the answers you are looking for before you leave so you know whether you two will remain partners from this point forward. Nonetheless, I truly hope you are able to resolve this matter and feel good about whatever decision you make. 

@Jon Holdman undefined

 This is perfect! I truly appreciate you taking the time Jon and helping me out with this. Now at least I have some general guide lines to follow when I start drafting up our agreement I will write it up as if we we will end up fighting. As we always said in the Marine Corps, "hope for the best, plan for the worst."

Regards,
James

Hello and thank you for reading and commenting on this post! My question might be a little long and there are several parts to it as well.

Background:
I am new to real estate investing, green as green can be, so I have been doing my due diligence and reading, listening to pod cast, and form searching on the subject of landlording (BP is an awesome information site) to learn as much as I can. I have established a LLC for some added protection because I wanted to be prepared in case an opportunity where to suddenly arise.

One aspect I never really bothered to look into was forming a partnership with others. Now a partnership opportunity has presented itself as an option to start investing sooner than I planned. I was able to find two other investors that are interested in doing at least one deal together. Us three would share the precedes and proceeds together and my LLC (JMS property and investment) would be the property management company. Both people are highly, highly trust worthy and honest people. Before I saw a lawyer I wanted to see if I could get a little incite as to what some basic options my be.

Questions:
Is there a right and wrong way for us 3 to purchase the property together (I am sure there is a list a mile long of the wrong way to do it)? When we purchase the property can I still use my LLC to purchase the property on my behalf (the other 2 going in on the deal are purchasing as individuals and not corporations)? How would getting a loan work between all of us, with one being a corporation? Again I am just looking for some general thought, ideas, and personal incite. Thank you.

Awesome story and thank you for sharing. It really keeps me focused every time I hear a great story such as this.

 @Elizabeth Colegrove

@Elizabeth Colegrove By no means am I professional or anything even closely related to it. I am not trying to break the law nor am I trying to misinform. I was just sharing my limited experience with the VA loan I took.

I looked over all the paperwork I signed and I saw nothing in it stating I could not move out of the property before a year. The only thing I was able to find was that I must move in within 90 days, which I already did. Before I decide to move out I will be speaking with an attorney to ensure everything I do is legal. Additionally, tonight I am going to read over every page of the loan paperwork again and see if I can find anything stating a period of time that the property must be my primary residence. 

 @Devan M.  To piggy back off @Joseph Zanazan  said. 

I just recently did a VA loan and I had the same question as you did as did. I had heard that there was certain period you must live in the house. So I did a little research and this is the only thing I could find, which coincided with all my loan paperwork that I signed. Nothing in my loan paperwork stated that I must occupy for a time period.

You must move into the property within 90 days and your intent must be to live in the house, aka make it your residence. Circumstance change so if you move out a week later after making the home your primary residence you will be ok. As long as the bank can not prove your original intent was to purchase the property and use it for another purpose you are all set.

My plans have change as I become more and more interested in real estate investing. I am thinking of moving out but when I started the process 6 months ago (there was this big challenge with me getting out of the military and working for family) it was not my intent to move out a short after the purchase. Technically I would be clear to move out even though I signed the papers last week. Side note: I was able to get a really good price on the place, which is another reason I am thinking of moving.

I hope this helps out a bit

 @Wendell De Guzman situation.

I understand that formula for the most part but why are those percentages, such as the vacancy and maintenance, used as a basis? I am going to guess that once you know your market area a little better you can adjust those figures to more accurately match the climate? The only thing I didn't quite grasp was getting the market value (12% for low income). Is there some generic formula that you use for low, middle, and upper income neighborhoods? If not how did you come up with that 12% figure?

@Frank Caputo I want to say thank you for this post as it has really helped me out as well. I just Honorably discharged from the Marine Corps. I decided 8 years was enough and I wanted to do my own thing. I am super green too and know every little but what I have learned has been due to this site and all the awesome pod cast, and reading as many books as I can get my hands on (audio books while I drive).