All Forum Posts by: Luciano A.

@Zach Strickland

Be great to meet other like-minded individuals. Digging the license plate.

@Michael Conte

AS a few people pointed out that having an LLC is not always the best protection. If I were in you guys' shoes and have W2 income I would put up to 10 in my name and another 10 in my partner's name. Get good insurance, umbrella policy, make sure you run your properties professionally, and remember the lender is your partner also. If you were to get sued they will step in and defend their interest so if you have very little equity in the deal after a BRRRR then no lawyer will take the case from someone wanting to sue you if they see you have 20-30% of equity. Lawyers like landlords that own free and clear or lots of equity to go after.

So many people let LLC and how to hold title slow them down thinking they need LLC to be protected. Insurance is the best protection. Pay a little more to have better coverage.

You and your partner are killing it with buying 3 in such a short time frame. Congrats.  If you can get long-term debt in your personal names it will give you better cash flow than going with a portfolio lender who will treat the loan as commercial with a 20-year amortization with a 5-year balloon. 

After you both get a bunch of properties then go to a local bank and ask them to bundle it all together so you can get one large loan. You can then put these sets of properties into a newly formed LLC and restart the process again until you get another set of properties to put into an LLC and keep repeating.

Best of Luck

Luciano 

@Melanie Liu

  Sorry to hear that you are going through this. I am a builder and when I get someone to approach me to get an estimate to build I tell them how long before they are ready to build. If it is not for 4-6 months I would tell them the pricing will not reflect what will happen that far out. Most builders are struggling with this. How can you price something one day and next week prices are higher.

I think you answered your own question. It sucks but it sounds like you might be better off walking away and asking for your deposit back. I am assuming this is a track home thus you only put a deposit not a custom build. Why buy in a subdivision that will be all rentals. Many think this is a new concept but go to San Antonio, cities by the border, and Killeen and you can find these 1980s subdivisions with all rentals. They don't appreciate well and if you don't have proper management can become a ghetto. 

You can write a bad review on yelp, google, and FB but I would not waste time with legal action as that will cost you more money without any guarantee of getting paid.

I havent found a subcontractor that will work for a loss and still do good work. If you have him build I would expect issues rising from them cutting corners. 

Best of luck

@Rob Newsom

I am an investor and builder. You can look at predesigned plans but each lot is different so you will need a site plan that is specific for your lot. You will need an architect that has done apartment designs for the size you want. The architect will be able to help you walk the plans through the city's permitting process. However, you should look around and find stuff you like maybe using Pinterest so when you sit with an architect you can give him your ideas on what you want thus can give you pricing. 

Banks will give you a loan up to 80% of the appraised value after it is built. You will need to own the land which you do and will need to have approved plans for them to review. In addition a builders pricing. 

Best of luck

@Jocilyn Oler

Today's market is crazy. I'm SMH as I see people rushing to buy thinking they must get in because prices will keep going up. Not all properties are an investment. I'm sure you have looked at plenty of deals but be patient. If your area doesn't cashflow then be patient or look at areas 1-2 hrs from you. Being near you doesn't make it easier to manage. Sounds like the flipper put some lipstick on the pig and selling for a premium. I would rather buy a property that had the roof, mechanics updated than the interior paint. 
I have invested before the 2008 crash and was buying after before it became popular again. The writing is on the wall, be patient. IF you keep looking you will find a deal.

Best of luck 

@Tim Richter

As others mentioned using steel wool and caulking all holes even as small as a nickel size is important. We have had issues in our downtown properties and found electronic mouse traps to be a great way to get rid of these critters. Home Depot use to sell them but not sure if they still do. Can do some research and I'm sure can find a similar device online. 

All you do is put some peanut butter in the middle of the trap and when a mouse goes into it, it will zap them with electric current and kills them instantly. No blood or guts to clean up. Just take the trap to the trash can and empty it. Then restart the process again. Once we have 3 small mice in the trap. Works really well and eliminated our mouse issues. 

Victor Electronic Rat Trap

Best of luck

@Shyam Panchal

If the home inspector was to not find anything then you would be upset and thought you wasted your money. These items are common on most homes that are not new construction. These items are very minor. I own property here in Houston and I am a builder. Many of my older homes don't have arc breakers unless I update my panel box. Item 2 is also simple to fix. 

For the water heater as the seller to credit you $750 or to show proof, they bought new. 

Item 4. Did the inspector use a moisture meter to see if there is a leak in that area. If it is there before the flippers got to work then it was just missed by them. (rookie mistake)

Item 5. Not a big deal but sounds like amateur, not professional trades were used.

DM me. I can help look up the address and give you feedback to verify it was done by licensed trades. 

In my option, today with HGTV and The University of YOUTUBE many people get into flipping houses thinking it is easy. I have heard too many times from investors who never seen the property and buy from a distance to find they bought a money pit. The finishes look nice but things covered up behind the walls is costly. 

Who are your boots on the ground? (Realtors get paid on commission so hopefully you have others)

Best of luck 

@Diandra Duncan

I agree with others that said this is not a waive of the inspection just can't come back and renegotiate. I would remind the realtor who they are working for. It sounds like they are more worried they will lose the commission than to counsel you. If I were you, I would ask your agent to run comps and see what other similar places sold for. If it seems like you are paying what the market is asking then I would have the agent caller the seller's agent and tell them if we move forward with inspection being only for informational purposes only then we should get a discount that the seller would accept so that we are not playing games. Let the seller come back and tell you what amount they would be willing to accept. The seller already knows there are issues thus trying to lock someone in without inspection issues opening up renegotiations. 

If the seller isn't willing to open talks then best to move forward if the deal is just an average deal. If the deal has meat on the bones and you are getting lower than recent comps for a similar property then spend the few hundred bucks and see what the inspector finds.  And find a new agent who will advise you based on your financial goals and not theirs. 

Best of luck on that new house

@Jayden Hamilton

We allow our residents to pay online, Zelle, and have them go into the bank and deposit into our account. Since we have many doors we require if they do go into a bank to put their address on the deposit slip. This way we can look it up if we have any issues on whose payment it was. Giving them a bank account number is safe and allows them to deposit at their convenience versus having to wait for the landlord to swing by. 

Best of luck

@Tyana Blackledge

If you are just starting out I would keep it simple if you have good credit and income. Forget about the LLC and all these other gurus tell people starting out. Most hard money lenders look at the property then you and what experience you have and what your capabilities would be with your personal finances. Most will finance the purchase and rehab portion so finding a great deal and figuring out the rehab is key.

I'd suggest finding someone in your area that is flipping successfully and see if you can partner up on a deal or two to learn the flipping business and then use that experience to go on your own. 

Many people think LLC will protect them from all liabilities but that is not really true especially for a single-member LLC. But won't get into that. So best protection when starting out is insurance. Get builders insurance when you are rehabbing so you are protected if something happens to the property. Make sure your trades have insurance and you will be good. Once you have assets then I would suggest forming LLC.

Using business credit takes time so why not get going on the how-to flip side while you build that credit up. Don't pay for those online courses that tell you if you sign up they can get you $100k in business credit. If it was that easy why wouldn't everyone be doing it? Just my two cents especially in this market where everyone is trying to find a way to have you depart with your cash.

Best of Luck