All Forum Posts by: Matthew B.

The more I think about it, the more I think I'm right on this. I haven't gotten an answer from my accountant. Either he's busy because it's tax time or I need to get another one...

In other words, if I can't find a small bank to work with me in my area, should I start calling banks in different states?

I'm having a really hard time finding anyone who will lend on investment properties owned by LLC's. Also, everyone says it has to season for 12 months before lending on appraised value. I'm looking for more like 6.

Trying to get my piece of this mythical BRRRR strategy...

I'm still trying to understand this structure as it pertains to flipping. So I'm thinking the operating company forms a holding LLC and says I'm gonna flip 20 houses with this one before letting it dissolve. Then operating company funds the holding LLC with enough to purchase properties and renovate them. At this point you have two companies to keep track of, two sets of books, two bank accounts, etc. Then, after 20 flips, operating company dissolves holding LLC and forms another, starting the process again. Meanwhile, operating company is the face of the brand and one paying me (the owner) a salary.

Thoughts???

@Joshua Fulenwider Do you have separate bank accounts for each property's LLC or do you write checks from the operating LLC's bank account? Is that a feature only available with series LLC's?

If full-service agents provided enough value to their clients to justify their commissions this wouldn't be a question.

I've had several attorneys and CPA's mention that house flippers should treat LLC's as disposable - that is, flip a set amount of houses with an LLC and then create another LLC and let the previous one dissolve.

The problem with this is that it's hard to build any sort of long term brand when the name of the company changes.

I've done a lot of reading on this site and others, and I'm wondering if an entity structure that involves an operating company would be the solution. 

That way, you could have the operating company be the face of the brand, and then form as many LLC's as you need to actually hold the properties - all of them owned by the operating company.

Is this a viable option to build a long term company or is there a better, easier way?

I'm not exactly sure how the money is supposed to flow from the operating company to the other LLC's and vice-versa. I'm hoping to get some advice from attorneys, CPA's, or flippers who have experience with this.

BTW, I'm not a new guy who's stuck on the color of a logo and getting t-shirts printed, so save the "just go do a deal" comments, please :)

Go with the flat fee broker. You can always relist with a 6% broker if it doesn't work out. I don't know of any serious investors in my area who use full-service agents.

1. Buyers who are working with their own agent will have no idea you are using a flat fee company. There's no difference to them.

2. I'm sure there are exceptions, I just can't think of any, but most listing agents are just going to put your property on the MLS and wait for another agent to bring them a buyer. You'd be amazed how little actual work is done for that $13,000 commission. Buyer's agents are doing all the work.

3. I am an investor and a flat fee broker in Florida. 

4. This is going to eventually happen. The big hurdle right now is MLS access. There can be different MLS systems for each county or city and sometimes multiple MLS in the same area. There are hefty application fees to join each MLS and also ongoing monthly or quarterly fees. So it's difficult and prohibitively expensive for a flat fee company to cover large areas. The big national companies, I believe, are partnering with local brokers and giving them a cut to list the property on their MLS. I'm a member of 10 or so MLS in Florida and I pay almost $15,000 per year in MLS fees.

Also, there are going to be agents who tell you flat fee listings get blacklisted and your property won't get shown. This is a typical scare tactic and I've never seen it happen. In fact, most buyer's agents I've dealt with prefer our listings because the investors are easier to deal with. 3% is 3%. Don't buy-in to the propaganda. 

You can do this. Message me if you have any questions.

On our rentals, we install vent fans that are rated for a much larger room and vent them to the exterior. We also wire them to a single light switch so the fan comes on when the bathroom light is turned on. No mold/mildew problems yet! As far as brand, we just get whatever is at Lowe's. Probably Broan.

Flat fee MLS listings are a no-brainer for all but the most inexperienced sellers. Make sure you list with someone who is actually a licensed broker with MLS access in your area. There are a lot of national companies out there who are simply middlemen and refer your listing to a local broker. If you go straight to the broker you'll typically get a better price and better service. Also, be wary of the up-sells. Some brokers will advertise a low rate but once you add up all of the additional services you're spending $500.

@Paul Smythe

You'll get better service and a faster response from a company who actually has MLS coverage in your area. The national companies do not have any MLS access, but instead subcontract the listings out to local brokers and pay them a cut of their fee, so you're essentially going through a middleman.