All Forum Posts by: Tyler Smiarowski

Yeah..looked at a 4plex a few years back on 21st ave sw when one of Miell's places went back to the bank. It was a complete dump...pretty sure none of the tenants were paying rent once it went back to the bank. It was listed for 105k. Each unit needed to be redone. Since it was on the SW side ended up not pursuing it.

Thought it would be interesting to know if other landlords have any stories in their area that involve landlords getting in big trouble. Here in Cedar Rapids Bob Miell was at one point the largest private landlord in Cedar Rapids...he owned approximately 80million dollars worth of real estate. The amazing part was his portfolio was made up mostly of single family homes. He owned I believe around 1,000 units in the city and out of that about 400 were sfh. Cedar Rapids is only about 125k in population. I've heard stories from people that the guy was totally weird...

 Link below outlines what he got in trouble for.

http://www.justice.gov/usao/ian/news/2010/sep_10/9...

I work full time right now...and just wrapping up my first flip. The rehab will take approx 7 weeks...I did some of the work like painting, demo, landscaping, etc...and then had others do the more skilled work...like laying tile, cabinets, etc. Seems like if I was able to do 4 flips per year while still working that would be quite a bit.

Just wondering on average how many flips others complete while holding down a full time job. Thanks

Below is an article these kind of signs in Cedar Rapids.

Basically:

Signs are required to be put up behind public sidewalks or at least ten feet  from the street

http://thegazette.com/2011/09/20/cedar-rapids-crac...

If your city allows I would use them. Bandit signs are an interesting topic on BP....I wouldn't be surpised if more people on here use them that actually admit it. Kinda like people bash/make fun of Wal-Mart but at the same time shop their.

Looks pretty good. How did you find this property? I don't recall seeing it on the MLS.

Also just because your income is considered "ordinary income" does not mean it is subject to self employment tax. It just means it will be taxed at whatever your marginal tax rate is.

If you have a day job a lot of CPA's I know (myself included) would not consider someone who has a day job and flips homes on the side as "self employment income". Many CPA's treat this no differently than stock sales.  Basically the "house flip" gets put on Schedule D of your tax return and is subject to federal and state tax, but no self employment tax.  If your only flipping houses and no day job...then it would be viewed as self employment income.

So you would either put that on your Schedule C of your tax return where you are subject to the full 15.3% self employment tax based on your net income on your Schedule C or you can set up an S-Corp...pay yourself a "reasonable salary" and then take the rest as a dividend. Only your salary in the S-Corp would be subject to self employment tax.

I currently work full time as a CPA, the 1 house flip I will complete this year will go on my Schedule D of my 2014 tax return.

The portfolio lender I use does not require 20 to 40% down. They actually will loan 85% LTV and this is actually on the appraised value of the property and not the purchase price. So if I buy a 4plex and it appraises for 130k..but I buy it for say 115k...I basically have no out of pocket expense (130x.85=110.5k)...once you factor in proration of taxes, rents, etc my down payment ends up being very small or nothing at all. I currently have 7 mortgages thru this bank...I also have 1 construction loan for a flip I am working on that I have zero out of pocket expense...here are the details:

Purchase: 53k

ARV (based on appraisal): 100k

The bank on the construction loan will loan me up to 80% of the ARV for the flip...at the closing after all the closing costs, etc...the bank gave me 10k for my rehab costs and when I need more I just send them an email and they deposit what I need in my account. I basically just showed up to closing, signed the papers, and the gave me a check for 10k and said good luck. As of right now the bank will provide me 2 construction loans at the same time as long as they are each under 100k.

Find a local portfolio lender...take one of their VP's of lending out to lunch.