All Forum Posts by: Jerry W.

@Daniel DiCosimo, you have received just about every possible advice you can get some not on point, most of it has a point in basis, and very little of it helpful. Some banks will only lend to LLCs if they have substantial assets or a track record. The rates of loaning to LLCs is higher than to a person if all things are equal in my experience, and you don't get 30 year loans so lower cash flow. I have never heard of banks refusing to lend to folks without an LLC for a residence rental, but have heard it for commercial property on occasion. Do what you have to do to get your first property. Most folks get as many loans in their personal names before they have to get commercial loans. You will not get the best terms and rates using an LLC to start out with. You obviously don't have a ton of assets or getting a loan wouldn't be as big of a deal. If so insurance should cover you until you accumulate something. Get corporate liability protection when your track record allows it. Don't get discouraged, figure out how to make it work, and don't listen to the doom and gloom guys. You could get hit by a bus and killed tomorrow, but thats no reason not to get out of bed and go for it. Good luck bud.

@Chris Hughes, what others would do is not what is always best for you. If it were me and I were young again, I would be prone to roll the dice and try a STR. However be smart about it. If they change the rules and you cannot short term rent it, have a safety net of being able to rent it as a long term rental and at least break even. If the area is appreciating in value as you mentioned you can make some money from appreciation. By break even I mean pay taxes, insurance, mortgage payment, and 5 to 10% for maintenance, and 5% for cap ex, and 8 percent for vacancy. While you want to grow your business don't be rash and risk it all by having the laws change. Good luck either way. By the way I have done both long term and STR. Str is a LOT more work.

@Carolyn Walters, just my 2 cents.  First really read your contract.  It will control unless there is a specific state statute that over rides ir.  Next Try to always be fair.  Explain that you make a living renting out property.  When they paid the deposit and signed the contract they entered into a binding agreement.  By waiting and not renting they have caused you to lose money in your business.  You cannot aford to lose money on every house or you will go broke.  They are legally obligated to pay you the rent whether they move in or not.  You are obligated to mitigate your damages.  Ask them if they would rather pay you each month and follow the contract or have you try to find a new renter.  If you find another renter that meets your requirements you will release them and move the other tenant in.  Make sure you document everything.  It is not always what happened, but what you can prove.  Send your letter and keep a copy, last I looked it was even legal in Wyoming to record a phone call if you were a party to it without the knowledge of the other party.  That is NOT legal in all states.  Be fair.  If they prove he had cancer then offer them a 50% discount on the deposit.  Cancer is a big bad scary thing.  Have a heart.  If they persist in threatening to put info in the newspaper, you can point out that libel is a basis for a huge judgement against them.  You are entitled to get back every penny of money you might lose from the libel.  If what they post is true it is not libel.  Finally in WY we follow the American Rule.  That means you only get attorney fees if it is provided for by contract, or authorized by a statute.  Be firm, be fair, document everything in writing, and don't lose sleep over it.  It will pass.  Hang in there bud, it doesn't look like you have done anything wrong based upon what you have written here.  There is a statute about the 30 days, but it is from the end of the lease, not from when they demand it.

@Thadeous Larkin, I agree with most of your assessment, the possible holes I was thinking of was the fact that the video was made in 2014, and the law was not passed until 2017, and the property was being operated as a VR since 2016.  So there are a lot of other things that could be evidence, but I would not rely on a video done 3 years before the law was passed as my main evidence of fraud.  I would expect they have something a lot better than that, but I find it utterly stupid the report stresses the importance of a video done 3 years before the law was passed.  They may try to claim some kind of unjust taking under the constitution since they were already engaged in the business before they regulated it.  The thing I find amazing is the obvious plan to make this a FELONY, when the number of deaths from drugged driving has increased massively from legalizing mj and shrooms.  I just don't get the logic.  One of the biggest problems schools have now is getting bus drivers.  My brother does the transportation for 3 different small school districts and he really struggles to get bus drivers.  Almost half of them 70 years old and many more are well into their 60s.  Folks say hey mj is legal, but federal regs require testing and one failed test and you are gone for good.  I don't condone folks breaking the law, I just struggle with the mind set of the folks who passed this.

@Joseph Nigro, there are pros and cons to each opinion you have received here. There are some threads on here about those you might do well to look up. My opinion is worth what you paid for it. It depends. If you are buying $10 million dollar apartment buildings go with the advice of scott. If you are buying $80K houses I would probably group them. If your net worth is a couple of million talk to scott if you your net worth is $20K I probably wouldn't bother with an LLC or corporation just yet. If you are netting huge amounts every month you can get serious about multiple entities and the massive book keeping it can entail. If you are barely making it adding in what scott suggests might break your company. There are a lot of details that make each way better than others. A shoe salesman can get you the best pair of shoes for you sometimes, other times you buy shoes that you really don/t need.

Congratulations @Account Closed, keep up the good work.  The first one is the hardest, so you are on your way.

@Stephanie Martinson, actually promissory notes are very simple to draft.  It the documents that secure the notes that get complicated.  It doesn't sound like you are into the security areas yet.  I am not familiar with them much, but the big thing is don't advertise for investors.  If you use folks you already have a relationship with, and follow a few other simple rules you should be OK.

I know that Colorado is a beautiful place, but I find it amazing that you can grow, sell and use drugs legally that are illegal under federal law, and Denver allows the use of psilocybin mushrooms which can be quite dangerous, yet renting out a house by the day or week is a felony.  What these folks are doing is hurting no one, and not themselves.  It will not possibly lead to a death from drugged driving, it will not result in an addiction for an adolescent, it will not result in lost work time, dangerous actions, etc., but it is considered a felony.  This is a reason we need strong lobbies to protect businesses that are just not popular.  It has pretty far reaching implications.  What if it becomes unpopular to raise rent and rent controls come, what if it becomes unpopular to evict people, so you get anti eviction laws, what if it becomes unpopular to have some people own more than one residence so they take all of your residences but one and give them to others who did not pay for them or earn them.  This will be a really interesting case to watch.  I can see some holes in it, but there is also evidence that may result in a conviction.

Hey @Jeff Fruhwirth just saying Hi and checking in to see how things are going Bud.

@Stephanie Martinson, I know someone who can help you with promissory notes.  They are actually very simple.  The security part can be more complicated.