All Forum Posts by: Lumi Ispas

@Ruth Lyons , I have you say you had your share of misfortunes with the home inspectors. As a real estate agent, I will say that there a big miscommunication between everyone involved.

One of my first experiences in the business with a home inspector was so bad, I almost wanted to get out of business. The home inspector was rude to me the buyer's agent and even accused me to work for the seller, as I was continuously asking him questions on how much that issue that he was making a big deal will cost to be fixed ( $15), how long it will take for the house to fell down because there is a bit of rust on the railing of the balcony of a 5-year-old home ( answer 60+ years if the railing is not cleaned and repainted  which was $100 worth repair).

You get the message. 

What I've learned in the end is that these home inspectors are not skilled in communication and they treat a small issue equally with a crack in the foundation or faulty electric panel. 

What I will advice is to have your broker attend the inspections and making sure the buyers understand that every house has a laundry of issues and the home inspectors are just looking for what's unsafe and not for every little thing to be fixed or create issues.

Good luck to you and make sure you find a broker that is empathetic and a great communicator. People think that brokers are hired to FIND homes when they are actually hired to CLOSE the homes!

@Tom, You start with asking referrals from other investors that are doing work now or just completed work, and you ask referrals from the subcontractors themselves. 

For example, my tile guy knows people in every trade and while working with other trades, I discovered that each knows multiple people in all trades. In the same time, you ask referrals only if you like the quality of work of your tradesman, as people tend to be at the same level and pricing.

Another amazing place to meet contractors is going the construction materials stores: Home Depot, Menards, Lowe, etc. If you are looking for a plumber, go to the store early in the morning and hand out in the Plumbing section. You'll get 10 business cards in a matter of 5 minutes. 

@Alex Proskourine , buy and hold seems to be a slower way to build wealth, however, it is the best and most safe way to create wealth. Until you own a rental property for some years, is hard to see all the benefits besides cash flow: extra tax deductions due to depreciation that can add up to 8K per year, principal paid off, appreciation, etc.

If you don't own properties right now, buy a 3-4 flat for cash flow with low down payment, and after you stabilize that property you can go ahead and buy flips to build more down payments. 

Let me know if you want to talk about this strategy! 

@Angel Morales , you and your friend got the right idea about working for yourself, and getting started in real estate is the best. 

You can each buy a 3-4 unit building as owner occupant with 3.5 down FHA loans and look for another property to do the BRRR strategy.

Good luck to yet.

@Mark Ainley , I called the city to ask the same question after one of my tenants left a car behind. The city advanced to just call a tow truck. If it's abandoned on your property - you have the right to get rid of it any way you find fit! 

Good luck

@Gintaras Kuzma , You make your money when you hold your properties not when you sell.

Seriously, you have 8 years to pay off a 250K worth property, and earning 36K per year equity, plus at least 3K in depreciation that you get back when you file your taxes. In the next 8 years, that's another 24K you'll keep in your pocket if you get only 3K back at taxes for this property.

In the same time, you have a great property in Logan Square, where prices and rents keep going up. 

I will say hold them both. In order to qualify for another mortgage in Texas, you'll have to show 6 months of reserves of PITI for both properties, which should not be hard to save, and take advantage of an FHA loan to buy a 3-4 unit building in Austin! This way you use the power of leverage to buy with low downpayment your next property, while you'll also get a lower interest rate than if you buy as an investor.

If you want to continue investing and need more down payment, pull a line of credit from your properties. Actually, I will apply right now as you are still occupying  Logan Square condo as owner occupant, and use that line of credit to invest in more properties.

Good luck to you!

Hi Matt, 

Chicago Title is great, however, they don't do a lot of creative deals! I will PM you the info for Altima Title company. They are a smaller title company, more flexible and affordable! Good luck to you! 

@Natalia Wang , I was at a zoning meeting recently and between zoning and variances hearings, there was a lady that owned a property in Lincoln Park with a coach house and she wanted to get it approved for AIRBNB. I noticed that all she did was to produce an application, stated her case in front of the Zoning Board and got the approval on the spot with no questions asked. I mean nobody on the board asked her any question, neither anyone in the room asked any explanations!

Based on that the system seems to be simple. Of course, you will need to do a little bit more research as maybe this owner had to jump through some hoops before that meeting that I was present to.

Here is the info that airbnb has on how to get the property approved for City requirements.

https://www.airbnb.com/help/article/861/chicago--i...

Personally, I have an AIRBNB in the suburbs so no more issues with the City of Chicago.

@Steve Wilson , to be specific, I had a number of mentors. 

My first was the gentleman that owned the property management company I was working for. I kept asking questions and when I start buying properties I realized how great advice he gave me after looking at my goals. I also just observed how he chose tenants, how he responded to sellers and how he negotiated. So working for him was a huge learning opportunity. I always offered to do more than what my job was and kept extending myself to learn new things.

Another mentor is one of my general contractors. He also owns a lot of properties and when asking him for pricing possible flips or a newly purchased properties, he always gave me pointers on what to look for in properties, floor plans I can work with to add bedrooms and baths, what an over improving was or under improving a property, plus he taught me how to price cost of construction.

I had several mentors that are mortgage brokers as I could not have learned so much about all possible types of financing without them. I kept calling them for years almost daily with questions, and I still call now, as new mortgage programs are offered and some change. As FHA values were just increased in Cook County for 2018 by 40K for almost every type of property. These amazing people keep me informed all the time and take my calls on Sunday evening if that's when I write an offer.

One of my longest going mentors is my managing broker that has been mentoring me since I got my license in 2002. He thought me how to price properties and that the most important thing is to underprice my flips. If when you buy a property you look at an ARV that's lower than most of the active listings, it's almost impossible to lose, as you'll sell your property quick and for the money, you hoped for or more. Also, he thought me the value of not doing dual agency or buying properties from my clients. 90% of lawsuits in this county are from Real Estate. You don't want to get in the middle of that, as you can't win!

I had and have other mentors and a lot of times they become my mentors not because I asked them to mentor me, but because I notice that these people I meet are more knowledgeable than me, are kind and they are willing to share. I always offered to help them any way I can and made sure I found a way to return the favor if it's by referring them, clients, helping them with their own projects or whatever I felt was a good way to thank them.

I also have paid coaches and I have two different one at all times that help me brainstorm my Business Plans, the skills I want to continue to acquire, and discussing all the problems coming up.

Remember you have to think out of the box, find the people you want to get mentored by, find a way to help them first and they will teach you everything you want to learn. 

And lastly, don't forget the Mindset mentors. :) Mine are long gone: Napoleon Hill, Earl Nightingale, and Jim Rohn. You'll find their advice on Youtube and you can continuously listen to them. 

P.S.  Jim Rohn said "You are the average of the 5 people you most associate with" Who are you associating yourself with? Is it time to change some of those people? 

Good luck to you!

@Arturo Perez , Congratulations on deciding to buy! Did you know that a homeowner's net worth is 45 times larger than the net-worth of a tenant? You'll find out soon why!

Because you got preapproved for 250K for a single family or condo, you will get a lot more for a 2-4 units building, as part of the rental income is taken into consideration to get qualified. If I were you, I would go back to the lender and ask how much you can get qualified for 2, 3 and 4 units with an FHA loan.

Also, in order to keep investing, would be good to buy another property with low downpayment after a minimum of a year in the first property. In this case, you look for your first property to be the best possible investment, as you'll move on and a year from now it will get rented.

If you still decide to go forward with a condo, try to get something close to the train, or in a great school district, and focus on the fact that the building has to allow rentals and not have a rental cap and also make sure that property can be rented for at least the amount all your monthly expenses for that condo will be!

Good luck and feel free to PM me with any questions!