All Forum Posts by: Mitchell Litam

@Russell Brazil I bought my first investment property with a business partner and have since did a cash out refi to buy him out. Does that basically screw me when I go to sell the house? Who would be the best person to consult? Is that my real estate agent or my tax accountant?

For 1031 There is no amount of times you can do that right? You can basically just 1031 until you die and the tax just goes away and doesn't pass on to your relatives or whoever inherits the properties?

@Macklin Park Ciesinski Welcome to the site man. Ill see you out there in the Cleveland market crushing it!

@Tanner Westerheid def make sure you check out James Wise guide to Grading Cleveland Markets. Cleveland is a midwestern rust belt city so the numbers can look incredibly amazing only to find out you are in the heart of the ghetto. There are tons of great areas much cheaper than Colorado that wont be a money pit. Make sure you do your due diligence before you pull the trigger. 

As for banks you can use national banks. I am not sure because I am a local but I would give First Federal Lakewood a shot. Also I would highly recommend you come see our lovely city and see what areas call out to you. 

@Russell Brazil I never looked at it that way. When I cash out and refinance the house the money I receive from that is not going to be taxable income is it? Or am I one of the naive people who have not done enough research yet? My understanding is that taxable income and capital gains tax only comes from when you sell a house. 

I have tried to study the market around me and narrowing my criteria. I have listened to your podcast months ago. I will have to revisit.

@Alexander Felice I love playing devils advocate and being super conservative with numbers! You saying you worked in underwriting brought me back to your podcast. I listened to it about 3 weeks ago I think. I was very excited as your main topic was long distance BRRRR.

@Russell Brazil As a young investor I dont plan to cash out and sell any of the properties I acquire in the near future, but I am curious. What happens to those people when the tax outweighs the profit? Do they sell the house and then owe money after the difference is all squared away from the capital gains tax? In that case wouldn't it make sense for them to either keep it or 1031 it into something else? 

@Alexander Felice Thanks for your response. Well said. I have a little saved up from being frugal and after reading all these books I would like to make sure I am able to continue doing the process rather than buy a couple houses put 20% down and have to wait to build more from my W2 job. So it seems the juice is worth the squeeze for me. Either that or it will be a learning process for me but hopefully I can learn from other people's mistakes and try and avoid as best as possible. What is the best way to measure and mitigate risk? Any articles or risks you know that would help me brush up on the basics? Just finished Millionare Real Estate Investor and moving on to J Scotts Estimated Rehab Costs VOlume 2.

@Frank Wong I have a good amount of trusted contractors in my network which would make it easier.

As of now my money is just sitting in my bank account basically dead money losing value due to inflation. You bring up a valid point which sounds dumb but I never considered. If the worst does come out and I cant refi I have a paid off house.

Thanks for your input.

@Jaysen Medhurst I will overly do my due diligence being my first one. You bring up some valid points in the BRRRs being forgiving. Ill keep to the strategy then.

Thank You

Hello BP Family!

After listening to multiple podcasts and reading books it seems like the BRRRR method is well received and makes so much sense because it allows your money to go further.

My question is it tougher to do a BRRRR deal than a normal conventional 20% down loan.

I know there are more moving parts to a BRRRR but I am familiar and comfortable with the refinancing process. I guess the part that makes me nervous is the all cash buy and then moving on to paying all the renovations in cash too and hoping you did your homework right to get the right ARV.

Am I overthinking this?

My last purchase was three years ago. Being stagnant has killed my productivity and I feel like I have never bought an investment property at all!

I tried rotating the image but I couldnt figure it out.

@Mike Reynolds Thanks for your expertise.

Is there an easy way to fix this? Is that something you could caulk or something?

I have no experience in any of that whatsoever.

I recently noticed a crack about 1mm or a little less all the way from the ceiling of my room to the floor. This is on the 2nd floor. The first and third floor do not show any signs of cracks.

Is this just faulty drywall? I read it could be from the drywall settling and cracking a little or something. How can I fix this? Its in my bedroom. I dont think it is anything serious but want to confirm with more experienced people.

I have attached a photo below. Sorry Tried flipping it but it didnt work. Hopefully you get the idea.

@Jeff Brower Great write up. And I love you are local since every market is different I feel this better applies to me!

I bought my duplex in 2016 with a partner but then refinanced him out less than a year ago. Since the title of the house went from 2 names to 1 and I have lived there for 3 years can I move again and FHA a new loan? Or do I have to wait a full year from refinance?

Good motivation with the county assessor website. There is nothing on the MLS and I have been reading books and listening to podcasts like crazy.