All Forum Posts by: Jeff Rabinowitz

Do not let your tenant train you. It will not end well. I assume your tenant is in violation of the lease every time they pay late. You should begin to enforce the late fee provision immediately. It seems you are willing to accept this payment pattern and even accommodate it. Personally, it seems like that would be much too much work but that is your prerogative. If you tire of the exercise you should be able to evict based on repeated late payments. (Enforcement of the late fee may change the behavior.)

I don't see what you hope to gain by modifying your lease to fit your tenant's poor payment pattern. If they don't pay and do not voluntarily move after you terminate the modified lease you will still have to evict them. Modifying the lease will set an extremely poor precedent if another issue arises.

This is interesting. My SFH portfolio is 1/2 over 5 years, 1/4 under 2 years and 1/4 over 2 years. (Your question doesn't specify where to place tenants with residencies of 2-3 years.) I try to make it easy for tenants to stay. Some I rarely interact with. Some of my long term tenants probably don't have the means to move even if they wished to. Some stay because they have children doing well in the school system and do not wish to disrupt that. A couple have indicated that they hate to move and would be happy to never have to move again. (I would also be happy with that.)

It is not likely that the bank will help cover this fee but you can always ask. If the loan officer thinks you will walk away from the loan they will have done a lot of work for almost nothing. They will make a lot more money if they close the loan and may surprise you.

Hello @Doug Silverman . Welcome to BP.  I don't care to answer your questions directly but I am happy to tell you that I replaced my income as a pharmacist 5 to 6 years after I started buying rental properties. It took, perhaps, 13 houses to achieve that. I am still licensed but work 10 shifts or fewer yearly. (I actually worked a shift today and have one scheduled in a couple weeks. That will make 6 shifts for the year so I am due for a vacation.)

I was involved in the purchase of a building the owners of which had recently challenged their property taxes and were successful in getting them reduced significantly. My group did not want a quick visit from the assessor so we formed an LLC which purchased the existing LLC. The building was the only asset of both LLCs. This did not show up on the public records as a sale of real estate. This made the transaction very private. Each of the investors in our group formed LLCs which bought shares of our parent LLC which purchased the LLC which owned the building. (If it is confusing read the previous sentence again slowly--I think you'll get it.) Another benefit was that in Michigan there is a transfer tax that is owed to the State upon the sale of real estate. I would have to check to be sure but I do not believe we had to pay that.

@Josh Rodgers, welcome to BP. Do you know you can search for topics on BP? I was skeptical of your statement that "info on these is scarce" so I searched for the term "investor capital" and it returned 7,137 matches. Granted, not all of these are going to be relevant to you but I'd bet at least a few thousand will be.

I took one out 10 years ago and it has been a powerful tool. You may borrow only what you need for your deal and pay down the balance at any time to keep your interest charges low. I was able to link my HELOC with my other accounts so the transfers into or out from the credit line can be done in seconds and the funds are available immediately.

@Al Bigonia  sent me this link which explains the ruling: IRS Eases Repair Regulations for Small Businesses .Thanks, Al.

@Al Bigonia, I probably won't look at my taxes for 6 months or so but thank you for posting this. Could you share any details on why the IRS decided not to require the form? Would you please share any details on the type of portfolio you have that you are comfortable sharing so others might see if their situation is similar to yours? Is your portfolio single or multi family? Approximately how many units? Thank you again.

How are you going to attract partners and investors if you don't know what type of deal you will be doing? Do a deal, two, three... See what appeals to you, what you like to do, what you are good at. The type of deal will inform the structure of your business (if you even need a structure other than sole proprietor) and the team members who will be important. If you attempt to set up a structure before doing a deal you may be frustrated very early. Worse, the structure you form may not be appropriate for what you end up doing. You may have to scrap it and start over anyway.