All Forum Posts by: Ludmila M.

Thank you, @Ryan C.! I will check them out. Is there a specific person you can recommend there?

Thank you, @Jeffrey S. Breglio. 

Identifying and meeting with an attorney is on my to-do list, however, I was going to let the tax guy (he is not a CPA) set up my LLC. I thought that he wouldn't risk his reputation by offering something he wasn't qualified to do. But I see your point and now altering my approach. I will speak to an attorney as soon as I locate a good one in my area. I just asked BP for help with this.

Thanks again for your input!

Ludmila

Hi,

Could anyone recommend a good real estate attorney, preferably in Roswell, Alpharetta, or Marietta areas?

Thank you!

Ludmila 

Thanks, @Jeff B., for the comments. S-Corp and LLC is what "my" tax accountant recommended for me as well.

Interesting note on setting up an out-of-state PM company. While I am years away from anything like this (first need to learn to be efficient in flipping, then buying and holding), I will keep in mind this information. Or maybe things will change in a few years? :)

Thank you, @Jeff B., for taking time to read and respond to my lengthy post.

I will do some homework on COE, as this is a new term for me. 

I feel I need to give some explanation regarding the $1,600 budget for a tax accountant. This is a quote from a guy who was highly endorsed here on BP, and @J Scott is one of his long-time clients. He specializes exclusively on real estate investments, and charges either an hourly fee or a retainer. He also provides services of setting up LLCs and registering them with the required authorities. With a retainer he offers $100 off each LLC set-up. Otherwise, his full fee would be $500 for the main LLC, and $400 for each "daughter" LLC (hence $400/$300 with a retainer).

Being a beginner, I am not sure how much of his help I would need outside of filing tax returns, so I am open to recommendations. Your comments indicate that a retainer would be unnecessary, I'm happy to hear this. 

In terms of setting up an LLC, I'd need to better understand what an attorney would do that this guy won't. It wold be convenient if this is done by the accountant.

Jeffery, a separate Thank you for listing all the hidden costs that you plan to discuss at your REIA. Any chance you could share that presentation? Also thanks for a motivational note at the end, I appreciate it!

Ludmila

Hi everyone,

First, thank you to everyone for making this forum such a useful resource. This is my first post, but I was using BP for a while and learned a lot from all of you. 

About myself. I am starting my business of rehabbing and selling distressed SF homes in North Metro Atlanta. I spent years as an investment analyst for a commercial real estate investment and development company overseas.  I truly enjoyed working in real estate, and this passion is what brought me here today. I am currently not employed and plan to fully commit to real estate investing. My husband has a full-time job and is very supportive.

I will be a cash buyer (some savings + HELOC) and plan to rehab 1-3 properties in 2016.

We are currently trying to estimate our budget for overhead costs, and this is what prompted me to write here.  I was wondering if you could help with understanding all expenses involved in setting up and operating this business in the first year? I searched BP for this information but stopped after 30 min of unsuccessful digging. Here is what I have so far:

1. Tax accountant: $1,600 (annual retainer, or pay $250/hr - what would you recommend?)

2. Setting up LLC: $400

3. QuickBooks: $300 (I will do bookkeeping myself in 1st year)

4. Obtaining RE license: $574 (course $289, exam $117, license fee $170) + $3,600 "desk fee" to employing broker (I might wait with getting my RE license until Year 2)

5. Local REIA Membership: $100 (undecided about this one)

6. BP Pro Account: $290 (undecided about this one)

7. General Contractor's estimates for properties I would end up NOT buying: $50-100 per quote. I am referring here to situations when quotes on rehab will make me realize that this is not a good deal, yet I still have to pay the GC for his time. 

8. Home inspections for properties I will end up NOT buying: $450 each. 

9. Networking costs  - coffee/lunches/etc for people I would like to meet: $?

10. Fuel: $?

11. Attorneys, title companies, anyone else - is there any cost associated with these people in regard to properties that I investigate but don't buy? Also, if I plan to work with a realtor at least in the first year, would that eliminate the need for attorneys?

Anything else I am missing? As to marketing, books, office supplies -  I can make assumptions on those.

All in all, I can see that it can easily get to ~$10K in out-of-pocket overhead costs in the first year. Does this sound reasonable? I will appreciate any feedback. Many thanks in advance!

Ludmila