All Forum Posts by: Joe Norman

I love the forward looking approach, however you're probably over complicating it at this stage. For the flipping business I'd set up a simple LLC since you won't have to worry about refinancing those properties. For the rentals I would purchase in your personal name (to get preferential lending terms) and then transfer title to an LLC at a later date.

LLCs are simple to create so you don't need to plan this too far out in advance, IMO. That said I would definitely consult with both a lawyer and a CPA before making a decision. 

Remote management is definitely doable, and as you hinted at it's very important to have trusted local vendors. The 12 hour time difference will be your biggest issue, have you considered a call center service? Probably would be cheaper to just hire a PM but may be an option worth looking into.

Here is a link to the Comptroller's guide to the non-resident withholding, which may have answers to your questions: https://www.marylandtaxes.gov/forms/current_forms/withholdin...

If link doesn't work the document is called "MARYLAND'S WITHHOLDING REQUIREMENTS for Sales or Transfers of Real Property and Associated Personal Property by Nonresidents" which you should be able to Google.

Good luck.

The OP is currently exploring conventional rehab loans (presumably 203k or similar) which would indicate that he is intending to owner occupy, and therefore hard money loans are likely off the table (as most HMLs are not NMLS licensed and don't make owner occupant loans).

That said, to the OP, if you're looking at a conventional rehab loan you're just going to have to accept higher costs, less flexibility, and more red tape. It goes with the territory. I can't answer your questions about whether those items would be problems for your lender, and they are good questions for him. One option may be to do a Streamline 203k and have your contractor do the bare minimum to get the home up to FHA standards, and then you can do the rest of the work yourself? Something else to discuss with your lender.

Good luck!

I'm local to Harford County and actively involved in this market. I can tell you that we have extremely low inventory and a limited appetite from our local government to construction significantly more. This is going to keep prices up regardless of the Federal Interest Rate moving a point or two. Those waiting for a recession will be waiting for a LONG time...it isn't happening this economic cycle, the stubbornly high inflation rates indicate that.

A few points above to reiterate: (1) real estate is LOCAL, while there may be some worrying trends nationally, the Harford County market is strong and will stay that way IMO, (2) timing the market is generally a fools errand if you have a long term outlook (if you're looking at short term investments then timing factors in more), (3) if you're looking for a place to live (not strictly an investment) then there are a lot of other important factors to consider.

Bottom line is that if you have the means, and if you intend to own the place for 5 or more years, I personally wouldn't hesitate to jump in. PM me with where in Harford you're looking to live and I can provide some more local advice. 

Good luck!
 

In my honest opinion if you aren't confident enough in your knowledge, network, and abilities to make the decision to self manage an easy one, then hire it out to a pro. There are so many unknown-unknowns and, unless you have a very experienced mentor willing to walk you through it, I don't think it's worth the risk for a rookie to take on self management. Good luck!

Love Lesson #4. My tenants will never have contact info for the owners. Even the units I own personally (under and LLC) the tenants do not know that I am the owner. Glad this investment is working out well for you!

I'm more curious about why your property manager rented this property out without a rental license in place already. I won't presume that they shouldn't have done this, but will state that in most jurisdictions with rental licensing laws thats a big no-no.

To answer your questions generally (not specific to Colwyn Darby, PA because I am not licensed there):

1) Generally the county will not allow evictions or rent collection actions if a unit is being rented without a licenses. Furthermore there could be fines/liens associated with any citations. I'm not sure what you would be "defending in court" if you've known about this issue since last year and have neglected to address it.

2) Get the rental license in place BEFORE you move in a tenant is the biggest takeaway here. As far as avoiding huge costs, thats all in your due diligence before purchasing the property (e.g., inspections).

Your lender should be able to tell you definitively, but as others have said you very likely agreed to live in the home for at least a year as a condition of obtaining the down payment assistance. Will the city randomly check? Probably not...but is committing mortgage fraud worth the risk?

The city posts the licenses to their portal immediately after the inspection, lead cert, and payment are all provided (again, through the portal). This is one of the few things Baltimore City Government actually does efficiently - probably because there aren't people in the loop.

Log into your Baltimore City Department of Housing & Community Development online portal, click the "My Account" at the top and then "Permits & Docs" on the left side. You should see your license in the list of documents. If you do not then you likely registered incorrectly because they are posted immediately.