All Forum Posts by: Jerry W.

@Marissa Contreras, I currently am invested in 3 states.  I registered my Corporation as a foreign entity in one, it only cost me $50 I believe.  The other state I have never registered in but have never had a problem.  The normal penalty that I have seen if you are sued is that they serve the Secretary of State instead of you, as you have no registered agent in that state to accept service, and you are not allowed to admit evidence in a case, but you can can cross examine, until you do register.  There may be other penalties I have not heard of.  Every state can make it's own rules on it.

@Brandon Gale, I am far from the Smokies, but historically AIR BnB has been about 90% and VRBO about 10%. Funny thing, but VRBO has been increasing this year compared to AIR BnB. I have seen lots more commercials for them. I just listed a 4 bedroom on both sites last fall. It is the biggest STR I have rented to date and I have a 2 night minimum, and it has only booked on VRBO so far. That is pretty odd for this area. I feel like I need to make sure that the listing is still on AIR BnB, but it is. It seems like bigger longer stays book better on VRBO that my small 2 bedroom 800 square foot houses. I also do not allow pets on the new one. All my other houses are pet friendly.

@Mike Gordon, I would strongly suggest setting up a separate account of the LLC. Depending on certain factors you can use your own social security number or get your own Tax ID number for the LLC. Your accountant will thank you for doing the separate account. The point of forming an LLC is protect from liability. The more you blur the line between your finances and the LLCs the greater the chance that there may be an attack to pierce the veil. Run your business like it was owned by someone else. As to financing, in 30 years of investing I have never found a lender who will lend to a new LLC without a personal guaranty for the loan. Your finances have to be in order to get the loan. There are bigger deals DSCR loans that only look to the income from the property, but those are usually very big deals.

@Alon A., it appears you live in CA. Keep in mind they will hit with a tax for every LLC or corporation you own even if it is outside of CA. Doing multiple LLCs will cost you a LOT. I think it is $900 or $800 per LLC per year. At this point you might just consider doing a single LLC for buying property and worrying about getting more complex when the income justifies it.

@Mary Flynn Maes  At this point you need an attorney, not advice from well intentioned people.  With your investment it is too important to do it otherwise.  You could face fines, or other issues if you just guess.  

@Account Closed, just so you know, WY does not have an income tax, and you only have renewal fees here based upon the amount of property you own in WY so the cost will only $50 or $60 a year.  Your need for multiple companies should be related to your net worth.  The more you have the better it is to be protected.

The absolute best protection is operating things right and having good insurance.  Lawsuits do happen, but not as often as you think.  Don't get so extravagant that it makes the real estate not profitable.  Best of luck 

@Chris Troutman, Welcome to BP bud.  Just thinking out loud for some ideas for you.  What about buying a duplex or triplex as another home in your area?  It would be in your own home.  You could live in one instead of renting, and fix up the one you live in really nice, then move into the other one and try doing a vacation rental in the one you fixed up.  You can buy up to a 4 plex and still do a fannie or freddie loan.  I don't have any idea what your area is, but often you can do STRs in a lot of places.  Now you have a place to live, regular income, get experience on STRs, and increase your cash flow.  After one year you can do this again up to 4 loans I think.

You might tell us more about where you live and what the market is like to see if a STR would work there. It doesn't have to be a $500 per night mountain cabin or beach house. I have plain houses in the middle of Wyoming and they do fine during summer months.

A third option is to add a duplex or up to a 4 plex and get cash flow up for a least a year to show more income for getting a loan for a STR in a year or 2.

Either way I want to say I admire how you are bouncing back from what has to have been a really tough time.  Use this as a time to grow.  Imagine any goal you want and start working towards it.  Give yourself permission to succeed.  I cannot stress how much you need to respect yourself and believe in yourself right now.  You are clearly articulate, intelligent, and ambitious.  You can't make other people do anything, but you can make your own life amazing.  There is often a silver lining in hardship.  Maybe there is someone who you will find who will be amazing, maybe you will reevaluate your relationship with your kids to make the time you do get special.  Take the time to really find out about them and what they are going through or their dreams and goals.  Anyway sorry for the rant, you seem like a nice guy who has had a hard time.  Light the fire and follow your dreams, there are amazing times ahead if you let yourself do it.

@Terri-Leigh H., congratulations.  So it looks like you live in Denver but bought in Florida.  I am curious how you chose that market and how the logistics have worked out for such a great distance?

@Patrick Melson, I have formed lots of LLCs in Wyoming both for myself and others.  I agree that it is healthy to look at lots of other operating agreements to see if someone has things you would want.  I also agree that one does not fit all.  It makes a huge difference on how many partners are in it, are they related, is the intent to run a business and provide for a split if you disagree?  Or is your intent to keep a business in the family and not lose part of the control to divorce, or is it simply to reduce taxes?  Anyway best of luck and welcome to BP bud.

@Brenainn Kilchoer, congratulations bud.  I have some rentals and STRs in Thermopolis and Worland.  I like Casper, but that market has seen so much bust and boom it kind of scares me.  Feel free to give me a yell sometime if you are coming through and we can grab a cup of coffee and chat.