All Forum Posts by: Jerry W.

I just bought my first real flip house and all the hardwood floors are pretty bad, I am hoping I can just refinish them, I also hope the second group is right.

Aaron Yates I have been in several joint deals if you will. The people who you partner or joint venture with matter. As a lawyer I can write you a great contract that will help you win in court, but it is only as good as the person who you are dealing with. You dont want to buy a lawsuit or a bad reputation. If you dont pay your taxes or fix your properties up something is dreadfully wrong. It may be bad decision making or it may be bad character, but either way I would not partner. You can buy from him, you can give him advice, but I would not team up. You are known by the company you keep.

Russ DeWolfe you might try getting bids for just foundation, framing and enclosing, if they rough in the electrical and plumbing/ac too it will save you a lot of headaches, those parts can actually be done pretty quickly yet still get you far enough along to satisfy most of your permitting.

Way to go Lindsay Wilcox. First I am not licensed in your area, and I do not know your state laws so not all of this information may be exact as to your location. (my disclamer) Corporations were originally formed to allow people to pool their money into a common enterprise through creating a new ficticious person and limit their liability to just their investment. Forming an LLC or a C Corporation, does protect you from liability in most cases because there is another legal entity created. With an LLC or a subchapter S corp you still get pass through taxing so you only pay taxes once. The problem with your scenario is that even if you were able to put your property into an LLC or C Corp., it wouldnt reduce your liability much. Any time you personally do an action you run the risk of being personally liability even if you have an LLC. Driving a car is a good example. Even if a car is owned by by a large company, say IBM and you drive it on IBM business, if you run a red light and hit someone they can sue IBM, but they can also sue you because your personal action caused harm to someone. Even with an LLC if you work on the electrical system and do it improperly and someone gets electricuted, they can sue the corporation but they can also sue you for your negligence as well. The idea of having a corporation is to limit your liability to the money you have invested in it and keep your remaining assets protected from suit. If you personally manage and repair then you are personally liable for most things anyway. Good insurance is a must, especially since you really have no expertise in doing repairs or renting. Direct insurance for a single property is probably best for now, if you acquire several properties down the road, you may want an umbrella policy thar adds addirional insurance to every property in the same form of ownership. Talk to an accountant, a lawyer, and an insurance agent. They will all cost you some money but you need to get it right. They all sell their time to you. Grocery stores dont give you free food, but if you ask they can direct you to the hamburger section instead of the steak section to save you money if you ask. As your business grows so will your need for more services from those professionals, but you will be better able to afford it. As a last bit of advice keep reading and learning. I have owned rentals for quite a few years and I am still amazed at how much I learn from reading posts on BiggerPockets. (I was horrible at renting when I started) It is much easier to expand your business if you expand your mind and knowlege. The amout of time people spend here to help others is truly amazing. I have benefitted from advice so much here myself. Matt Devincenzo, Bill Gulley, and Chris L. regularly give their advice freely to help others. I allmost feel like they are associates even though we have never met, talked, or even seen each other. Best of luck!!!

Lindsay Wilcox you allready have some great suggestions, let me add a few more. Their is a tool for putting sink faucets on, I cannot recall the name, its only a few dollars and looks like a big C on one end with a spring load. It is a must for tightening sinks down. Allways have at least 2 decent sized pipe wrenches, a screw driver with multiple bits in the head, and a few sharkbite shutoff valves of half inch and 3/4. If you live in the unit get a short, no more than 20 foot hand snake with a drill hookup, they are about 10 bucks and handy for short runs to clogs. An adjustable head flashlight is nice, even if you have a light on your drill, when you are plumbing they are nice. Lots of rolls of teflon tape, plumbers sandpaper, ALLWAYS bring a roll or two of paper towels and dawn dishsoap for clean up of you and tools and messes. A cheap wet or dry shop vac is very handy too. They are a bit pricey but the adjustable ladders are a lifesaver sometimes, changing a bulb on a stairway, etc. Look for a decent appliance dolly at yard sales etc, they are handy for changing out a fridge, or hot water heater. I like your attitude on life, but remember you did not create their situation, they did. Folks who get something for free do not value it, those who work for something will value it.

J Scott First thank you for doing this, I am amazed over and over again at how much time folks on BP spend helping others. As I was putting a new roof on my rental, I recalled your bid for your roof. Your roofer is still using felt paper. Our area has gone to a new titanium wrap that is probably a third the cost of felt, and can actually be left exposed for up to six months if properly installed. It is extremely durable and much better to walk on, but it it is a VAST improvement in that the wind wont rip it and tear it off. Just a thought. Ask your roofer, he might have a reason for using felt, and if so I would like to hear it. Thanks again.

Jason Brooks I am from a small town so I get info from word of mouth, folks hear someone is selling or moving away they tell me. You might look in the legal adds for foreclosure notices, check obituaries, check court records on lawsuits/collections, and cross those against the county property ownership computer records. Also check anyplace the lawn never gets mowed, or the grass is brown not green, or other obvious signs of no tenant on premises.

Jason Brooks I like your initiative, and wish you luck on your endeavors. I have not wholesaled except 1 property by accident, and have not done a flip yet, but I have been a buy and hold for allmost 20 years. Here is my advice for what its worth. First Bill Gulley gave you great advice. Based on what little I know of wholesaling you do not neccesarily need an LL or Corporation to wholesale. You won't get a loan on a new company without a personal guarantee anyway. Learn the business. Knowledge is crucial. Learn what houses are selling for in what neighborhoods, learn what upgrades sell houses fastest. What modifies sale price? more than 2 bathrooms? Garage? Hardwood vs laminate vs carpet etc. When you know thwe market then you can do a wholesale. When you have a good idea how much the cost is to put a new roof on or a new furnace, and rehab a new bathroom or kitchen, then you can do rehabs. Knowing the business is the most important part, you can set up the rest as you can. Allways us "or assigns" on any contract you purchase or sign.

Denise D I do not have much to add, the advice you got from K. Marie Poe, Dawn A., and Karen Margrave was excellent. You need to know the area of real estate you are going to work in BEFORE you spend your money in it. One of the advantages of real estate is you can find a part of it that you truly enjoy doing and make earning a living both more rewarding in terms of income and in quality of life.

I value my spare time a lot. I set the original rent based on market and when I get a truly good tennant I dont raise them. One stayed over 10 years and the place looked as good the day she moved out as the day she moved in. When she did call I tried to address her concern in 24 hours. She bought half of that house for me. Even if I keep full, when someone moves out I have to go in and do something, touch up paint, clean the fridge, paint a window sill etc. Then I must show it several times to rent it and draw up the lease, etc., my time is very valuable. If I am not wild about the tennant I try to evaluate the rent once a year. I usually give 3 warnings before I boot a renter, partially because I dont want the hassle of fixing and rerenting.