All Forum Posts by: Michinori Kaneko

thank you!

Thanks everyone this was very helpful! 

Hi,

I'm just getting started in real estate investing, but I have a question. I have a very good credit score (was 800+ when I checked last time). I'm thinking about doing BRRRR strategy. However, with this strategy, you require your credit to be pulled multiple times to refinance the loan (and for me, I finance my first purchase as well). Wouldn't your credit score deteriorate a lot from getting lots of hard inquiries on your credit, which then will increase your interest rates? How does everyone deal with this situation? Thank you for your help!

Hi!

i'm new to rental investing too, but here is what i did.  First, come up with game plan.

1. Do you want to invest locally or out of state.  I think Knoxville is hot market now so maybe good to invest locally. I invest in Indiana.

2. Decide what route you want to take (e.g. flip vs rental). i think rentals are easier to grasp at first. SFH or MFH or something else?

3. speak to multiple real estate broker and property managers (if you are intending to use them).  Find the ones that are hard working and you would like to continue working with. 

4. based on your strategy, learn about what you need to look out for when you look for properties.  For instance, for rental, you want to look for ones that don't have lots of yard, because when its vacant you would have to pay a lot for mowing.  you don't want builtin pools for the same reason.  Multiple garage is a plus, etc.

5. based on what you find out from no4, find properties that fit the criteria. Run them through your PM/RE Broker.  see what they think (how much can it rent for, does it require significant amount of work, is the area a good growing area, etc.)

6. Crunch numbers, if it makes sense make an offer!

Hope that helps!

Hi, 

when i started looking for investment properties, i started looking at Austin as well. I had friends near by, and i knew the market was hot. I quickly realized that you can't have positive cashflow in the area.  I live in NY, and the reason I was looking at other state was because of the same reason.  I settled for investing in Indiana.  Of course, appreciation is probably likely in Austin, but you are also paying every month to cover for shortage of the cashflow. If you want to play the appreciation game, NYC is better bet than Austin.  I would rather have positive cashflow though (that's a visible gain as opposed to betting on probably, but not 100% return on appreciation).   

Just my 2 cents. Hope that was helpful.

Hi Rob,

I live in NY currently, but I used to live in NJ before and worked at NY.  I'm pretty certain that NY taxes any income that originates in NY only (and NJ taxes you for all income if you live there, thus most people living in NJ and work in NY pays taxes to both states).  I'm obviously talking about income taxes here, but I wouldn't imagine there is a specific different tax code for rental income. 

If you really want to be sure, you can try punching in some hypothetical numbers in turbo tax and see if it generates tax on more than just your rental income.  turbo tax should be free until you actually submit the taxes so you should be able to see the taxes you would owe on your hypothetical numbers without actually submitting/paying.

Thank you.  

@Antoine Martel why do you suggest Wyoming?

@Dick Stevens this is very helpful thanks. If I talk with my bank and I have good financials, then maybe they would allow me? I will speak with him first before doing so.  Thank you!

Hi, I just went into contract for my first rental property a week ago. the property i'm purchasing is already in contract with my personal name, as I read many articles about how setting up an LLC is overhyped. I had every intention to form an LLC eventually when my portfolio got larger (and my potential liability gets larger), but now i'm leaning towards having my own business account segregated from my personal accounts right away. Because of tight closing timeline i don't think I have enough time to setup the LLC and change all the paper work. So here are few questions I have:

1. Is it easy to switch title on the property from myself to an LLC I form at a later date? My property is financed via conventional loan. 

2. Obviously, my first few cashflows will be done via my personal accounts.  Is there an issue from keeping business separated from personal, if I maintained a really detailed excel file that lists all cashflows that's related to my business until my LLC is setup and I have a business checking/savings account setup?

3. which state should I form my LLC at? I live in NY, but my investment property is in Indiana.  I read an article online that even if you register your LLC out of state, you will still need to register the LLC at your local state as Foreign LLC (and you end up paying fees for both states).  

Thank you for your help in advance. 

why don't you negotiate "seller financing".  then, once you get the title to the house, you sell it, collect equity, payback the loan (to your parents), and invest the remaining in other investment properties?

thanks @Alan Grobmeier  I did mention #3 and #5 (and #6 somewhat), but good to know about the rest :)