All Forum Posts by: Katherine Earle

I am about to purchase my first rental with a partner. I will be doing the property management for the rentals I buy with my out-of-state cash partner. Do I charge my "Property Management Company" a fee for the services and then split the cash flow and equity if we sell or buy each other out at some point? I will also be the agent, assisting with the purchase. Do I charge the normal commission on top of all of that or waive it as a personal transaction? It feels like I'd be getting the lion's share of the deal. He is a very generous man, but I don't want to be taking advantage of his lack of experience. 

My lender also said the same thing yesterday about buying a property with cash, applying for the cash-out refi, then using a title company to transfer title to the llc. They do it all the time like that.

You honestly don't have to take my word for it since I haven't done it personally, but my lender actually brought it up to me to buy a vacation home for 10% with the intention of being there a couple of weeks out of the year and renting it out the rest of the time, my parents did it with their vacation home in Tahoe, Tony Robinson interviewed his lender who talked about it on his own podcast, and Tony Robins talked about it in his book "Money, Master the Game" with the Island he owns. He goes there a couple of weeks out of the year and he uses the resort he built on it to pay for it. Also, the FHA loan helped a low-income family of 5 was interviewed on a different podcast become investors. They are currently in a triplex as their 2nd property using FHA and are almost financially free. No doubt that there are wrong ways to do this stuff, but educate yourself and don't stop at your first no. Good luck!

I lived and worked around Milwaukee for the last 3 years before moving to Michigan and I was pleasantly surprised! I worked for a flipper out there who does amazing, but she knows the market very well and spends tons on marketing every month to find her deals. Definitely not easy! Just because the prices are cheap, doesn't make them a good deal! 

Congrats!!! Way to take massive action! The worse thing you can do is take no action. Everything else is either a win or "education". :-D Good luck with a successful closing!!

We didn't talk about specific criteria other than it not being in your same area, but it was actually brought up by a lender I was talking to regarding potential investing strategies. Something I'm considering when I'm ready to get into short-term rentals. 

Many people have used the approach where after 12 months, they refinance the first property, go buy the next one with a new FHA loan and rent out the unit they were previously living in for only 3.5% down instead of the 15-20%. Haven't done it personally, but that was the approach I was looking at to get started. You could also look into a vacation home loan which only requires 10% down, as long as it isn't too close by. I have to keep reminding myself as well that those first few properties are always going to be the hardest. Buying rentals is a long-term play. No get-rich-quick scheme here!

Actually, I am expecting to be in that position at some point this year. I am looking at using it to invest in the best commercial sized multi-family property I can, for both cash flow as well as appreciation potential. Then use it as my "seed" money for future investments.