All Forum Posts by: James McMurrey

Hey Michael,

I use Kimberly Furrh at Furrh and Associates (offices in Dallas and Lawton). She invests in real estate personally. So she was able to help me out with some tips and advice when I was first starting my portfolio. And most importantly, she thinks like a real estate investor and is very familiar with the tax advantages of rental properties and flips. She also works with a lot of military being based out of Lawton. So everything can be done remotely as she is used to handling clients that live all over the US/world. I also like that they have a portal where you can upload all your documents. It makes it super easy to file each year. 

Not sure if she has any experience with opportunity zones but I'm sure she can also handle an inherited IRA scenario.

She does an initial consultation where you can determine if it's a good fit. (or at least I set one up way back when)

https://www.furrhcpa.com/ 

Trenton,

I work as a mortgage lender at a community bank in Oklahoma. 

I recommend cash out refinances after the rehabs are completed. That's what I typically do on my own investments. Depending on the deal structure, appraisal, and original loan, this option tends to give you cash in hand at closing to go buy another property. 

You can take advantage of Fannie Mae products for your first 9 properties (qualify in personal name instead of LLC, which means less documents and more favorable terms & rates). This means you can do up to a 75% LTV cash out refinance into a 30 year fixed rate mortgage. This tends to help with cashflow on rentals as 30 year notes have the smallest monthly payments.

Most lenders will be able to provide this for you. So who you pick is more about customer service and communication. So choosing a local lender is my advice. Feel free to shoot me a message if you want me to take a look at your numbers and exchange contact info. 

All the best,

James

Speaking from personal experience and not as a tax or legal professional:

Short Answer: One LLC will work just fine.

Long Answer: LLCs are primarily about limiting your personal liability in the event that someone sues you for medical expenses and damage beyond the limits of your insurance. So my strategy is an LLC for every 5 doors that I own (SFH, 1 unit, rental properties). I think it's more of a personal decision each investor has to make. I've known some investors with 15 rental properties in one LLC. I've known other investors that have an LLC for every 1-2 properties (This would be a nightmare if you have 20-30 properties someday. Imagine trying to keep track of 30 LLCs, your CPA is getting a headache just thinking about it haha!) I think somewhere in between is probably the most prudent without causing excessive paperwork and filings.

My growth is currently limited (4 SFH rental properties). I know what I need next though. I need a bookkeeper. I've had lenders tell me I need a book keeper to extend guidance lines for further financing. If I don't have financing, then I don't have money to buy more deals.

Long story short, acquiring teammates along the way is the key to scaling most businesses and real estate is no different. 

Union State Bank is great option. I work as our mortgage loan originator here and do a bunch of cash out refinances. 

I've done 8 transactions with other lenders in our area for my personal investments. Ken Janz at First United is who I like using.

John, 

Thanks for sharing! This is also my first post ever!

I work in a community bank as our mortgage lender. So I asked our commercial lender your question since I only do retail mortgages. She said, they still base the LTV off the sales comparison approach (appraisal) on the property. They will likely be able to offer an 80% LTV with 15-20 terms, adjustable rate every 3 years. So it sounds like it "may not work that direction," at least at my office. My spouse was attempting to refi an LLC property like you mentioned above on the podcast. She also had the same issue and had to refi using her personal name instead of thru the LLC.

On the retail side, I know a lot of investors that will do a cash-out refinance into a 30 year term, fixed rate mortgage at 75% LTV (sales comparison approach appraisal). This would be in your personal name and qualification is based on credit score & DTI. It's a fannie mae product so you can only do this for your first 9 properties. I've been able to use this personally to maximize my use of capital as a "beginner investor" (4 rental properties so far).

Given those numbers, I'd suggest running your current mortgage through those 2 LTV scenarios to see what gives you the best cash-out result and maintains your cash-flow. 

Feel free to reach out if you want to discuss your numbers more in depth.

All the best, 

James