All Forum Posts by: Account Closed

a podcast on here said one of the first questions should be: do you own any investment real estate? 

in the podcast they recommended finding one who has an active interest in real estate investing, aka owns some other then their primary residence.

this is supposed to help ensure they are experienced in that field and know all the ins & outs regarding the specific tax or whatever subject and how it relates to your real estate investments

very similar to a house i used to own.

what I would do: 

pay a company to send a camera down it with you there so you can actually see the line the whole time, dont trust them if they say they sent one down and the line is broken or someones assumption that the line is broken. They want you to just scare you and get the ok to dig up the line. 

I  had damaged lines ( minor cracks) where tree roots get in and severely slow the flow. once a year or every other year I used to rent a 3/4" sewer aurger for 75 bucks and clean the line from the house to the street (about 80 feet). Usually pull up a few big fist full's of small roots. 

its better then spending the 10k at least and wasn't really a big deal.... but wast a permanent solution.

fyi not sure what catagory to post this:

Im trying to pick an online rent collection company to go with. I went through a list I found on biggerpockets

http://www.biggerpockets.com/rei/pay-rent-online-p...

and the closest match for what im wanting appears to be erentpayment.com anyone have any experience using them?

im looking for the following:

- allows auto payment set up

- costs $5 or less per month

- can set up where partial payments are not allowed 

- auto adds the late fee at specified date, AND renter cannot pay less then full rent with late fee after that date ( not sure if erentpayment.com has this, doesn't look like any companies offer it though) 

- can accept credit cards for a small convenience fee to the renter. (erentpayment makes you set up a whole merchant account and just doesn't seem practical unless you have allot of doors)

- sends auto reminders to renters when rent is late, maybe even auto phone calls? that would be great

out of the 13 companies i found on a biggerpockets blog list, erentpayment is the closest to the above and charges $3/transaction but doesn't seem convenient as the others with taking credit cards and not sure about the late fee item are my biggest reservations on going with them. 

any recommendations that hit all the items better? ideally something that is related to biggerpockets smartmove, sounds like that is a pretty decent tenant screening from the reviews

started an LLC, actively working on the renovation of SFR #2 (about $17k of anticipated reno costs). Daily trips to the home store for materials and doing all the work myself. Random piles of receipts, some probably still in random pockets :). paid a few people cash for labor. gonna need a large amount of labor shortly, typically hire friends and pay them cash.

I typically just go to H&R Block, another bad move?

I have a bad feeling that I am screwing myself. I go to the home store daily, sometimes more then once. do I really need every receipt? I have a dedicated credit card ONLY for reno stuff, would be great if i could just use the end of year statement as my list of costs but i have a feeling that isnt good enough. 

also, how bad is it to pay cash to a friend for labor, tax wise? typically a few thousand per year is what it adds up to @ $15/hr. is this money going to show as a profit even though it was actually 100% an expense??

and.... who does your taxes? im guessing not H&R block :)

Ive been asking myself this same question. ive decided for the near future, and including the house im working on now;

- i will buy with the anticipation of renting it out, so the numbers have to work in that fashion. 

- once im done with the renovation i will list the house on the MLS ( flat fee listing service only costs like 500 bucks) for a couple months. If i can sell it for the equivalent of 5 years of profit i would of made by renting it then i will sell it instead of renting, otherwise back to original plan of renting the property as originally anticipated.

because the question ultimately is (and is what i think if you ask yourself you will find the answer to your post) at what point does the amount of immediate lump sum profit of flipping outweigh the potential never ending small incremental profit of renting it out. for me its 5 years of rental profit, atleast at this point, i may change that amount of years as I grow with experience.

i have ACV, 100k (which is more then the property is worth) = $37/mo

I would say absolutely not worth 50%. your money, your name on the title, your risk, period. 

the 8% to 15% comment would be if you are able to lien other assets of his to guarantee you get paid back. unless he is offering up 50% of the financing OR allowing you to put your name on the title of some of his other property not including the investment property at hand which would then just make you a hard money lender, then the answer is no way should you pay 50%. 

you could offer a referral fee to him for contractors that actually end up being low bidder ( you go get quotes, then get a quote from his referral, if it is truly such a "deal" then pay a referral fee.) what that would be? i dont know, i probably wouldn't may more then a few hundred bucks ....and then would likely end up kicking myself for paying anything. 

that is ridiculous to pay a major percentage because someone has "access" to unique contractors.

same problem in the house i just bought, mainly lack of water flow on the hot/cold lines. 

mine is a 2 bed 1 bath house. I did it all in CPVC. 100% new hot and cold lines from the point water line enters the house. cost me about 250 bucks total in materials. waste lines were fine but I would expect if i had to replace waste lines it would be another 75 to 100 bucks. 

PVC and CPVC is very inexpensive and its legal in nearly all cities ( i live in omaha where its regularly well below 0 degrees fyi). no torch, just some primer and sealent and a 10 dollar hack saw is all you need. just make sure you support every few feet, maybe not required but makes it allot more stiff.

I started peice mealing the galvanized back together before hand then just decided to take the sawz all to everything and replace with CPVC. made it much simpler :) 

im 95% done, will be done tomorrow. i will have about 20 hours in it all by the time its all said and done.... but im slow and tend to take allot of local bar breaks in between. 

same amount of plumbing in copper would of likely cost me over 800 bucks. I did my last house in copper before i found out about CPVC. 

 @Owen Dashner  great idea about the facebook groups. ive heard of those

suppose i will have to finally start using social media ( other then BP ofcourse)

...... i think im still on myspace lol

( for my real job) i estimate construction costs, mostly large commercial and public projects. 

I would say I am careful about what I break out because it opens me up for possible items that I didn't anticipate ( allot of costs are dependent on others in a contractors mind). there are allot of spread costs that when bidding, you are high on some and low on others but in the end you hope it will even out and end up with the profit margin you anticipate. 

as for the comment of saving  30k by managing yourself? i highly doubt that, unless your scope of work is truly small and you are hiring a contractor that literally doesn't self perform any work, which in this world the competition is too fierce, and a small time reno contractor wouldnt stay in business too long if they are just simply "pushing paper".

@Scott C. is exactly right. With large contracts there is always a set of plans and a set of specifications detailing exactly what the client is expecting, all the way down to the grade of nail to use for each item. 

On my rehabs I hire the trade contractors directly, there is less risk because if i mess up then i just have to repay/negotiate with that sub on the work, if there is a general contractor in the mix then im paying the sub to redo the work plus the general's profit overhead, again.

I make up a simple scope of work, with line items for each general scope ( example: painting whole house scrape prime plus 2 coats, all drywall work for bedroom #1, all electrical for kitchen, etc,) they dont have to be extremely detailed, but enough detail to allow you to pay the contractor in regularly billings for percentages of work completed per scope and actually be able to explain to your boss ( i always say i have a boss just to end that discussion, be it my wife or my dog or whatever).

I usually have a simple paragraph stating the exact types of materials I want used and reference that all work must be in accordance to the latest applicable IRC. In there I state that They must have me inspect their work at individual milestones for pay ( example: painting the house I must inspect after scraping to ensure enough scraping was done and prior to 1st coat, inspect again prior to second coat to ensure I really did get a good true first coat of paint, etc.) 

I also base pay off percentage of work complete for each line item. you both must agree to the percentage at time of pay. up front on the contract I state that I hold a 10% retainage from all billings to be paid upon final satisfactory completion. 

regardless of the area you are in ( the company i work for, i bid work in every state) it is acceptable for  you to utilize the basics of contracting including detailing out a scope of work, paying based on percentages of individual milestones, holding retainage to ensure satasfactory completion.

now some small time contractors may be unwilling to work with you because its obvious the standard you will hold them to and they wont be as easily able to half *** their way through the work and blame you for not being specific. but most will, and may even prefer it as long as this is discussed and detailed in the executed contract. Another item i do is I use my own contracts which is very common with larger value projects ( owner to provide the contract) but less common with small 100k or less type contractors, most dont have a problem with it and it allows me to just throw my scope of work into it as an appendix and all my requirements about retainage and inspections and IRC references is in there. 

as far as your 95k bid goes. get 4 or 5 more bids, it will become obvious where the fair value is. I enjoy getting allot of bids, and its very simple once you have the scope of work, line items written up. simply meet the contractor at the house give them the piece of paper and continue.