All Forum Posts by: Jessie Dillon

what's your personal guideline for how much to keep in reserves per property?

doing some research for an upcoming presentation, and as a hands-ON investor, it can be hard for me to really put my 'hands-OFF hat' on and compare passive investing vehicles without any bias. 

i'd love to hear especially from those who have tried multiple strategies, which of these you lean towards most & why:

- syndications

- REITs

- private lending

- being a hands-off capital partner

- buying from turnkey companies (not sure i'd call this passive though)

...& feel free to mention any other passive investing vehicles (in the real estate space) that i haven't listed here! thanks in advance for the insight. 

- most lenders will not be ok with your having secondary debt for the down payment on the next property. are your parents open to instead PARTNERING on the next one in exchange for, instead of a fixed rate of return, a % of equity/cashflow? the 5% preferred return may even be enough for the lender to say no. & you'd all have to personally guarantee anyway. only have the mortgage would count against your DTI if you have a 50/50 split.

- what if your parents alone get the loan and buy the property, then quit claim deed it to a trust with all 3 of you as beneficiaries. the trust would have a jv / operating agreement outlining everyones percentages and responsibilities. the debt would only be in their name.

- every investor reaches a point where their DTI is trashed and they have to move into different loan products. there are tons of lenders out there that specifically work with REIs & have many ways to navigate this. don't let DTI concerns keep you from moving forward.

- LLCs provide minimal legal protection in case of an incident. work with an asset protection attorney to come up with a better plan if they are that concerned. also have great insurance and an umbrella policy. 

welcome, justin! i'm also a househacker. great way to lower your personal cost of living. please let us know if we can help with anything in particular as you keep going!

connect with a RE attorney in your state!! every state his different rules/regs around this

welcome! exciting position to be in! please let us know if you need help with anything in particular :)

welcome! i invest in chicago! i've been meaning to check out the 'straight up chicago' podcast about the rental market out there. to learn about property mgmt in general, two BP personalities have a book on preorder right now about self management, it should be showing in the bookstore on here, that will be a good one! 

if you're ultimately looking to having a long distance rental property, and you find a deal where the numbers will work well as a rental one day in that city, you should do it! i know a lot of long distance investors love indianapolis for that. BUT i wouldn't buy with the intention of selling in 18 months. you never know where the market will go, your closing costs could easily eat up the equity you built up, etc. 

MOST midterm tenants are looking for 90+ day stays, so especially if that's true in your area, i wouldn't worry about this!

i'd try to get to the bottom of why he DOESN'T want to seller finance. if it would be more optimal tax-wise, if he'd make more money on the sale overall, if he wouldn't have to handle a large lump sum, if he'd be getting true 'mailbox money' that his children would then get... what is he concerned about? what's turning him off? but also, keep in mind that as much as SF would appeal to buyers, there's really been an uptick in trying to force it down sellers' throats. it's not for everyone. whether we agree with his logic or not, if he doesn't want to SF, he doesn't want to SF. it's a good tool to have in your toolkit, but don't waste energy trying to force it.