All Forum Posts by: Peter Stewart

Always contact an attorney for advice on landlord/tenant issues, especially when it comes to evictions.

Welcome Tammy! You're in the right place! Best of luck on the new venture.

As already stated, first step is to speak with an attorney since there are many legal ramifications for putting your home into an LLC.

You'll find the consensus divided on LLCs for rental properties. And, for those who do them, some do each property as a separate LLC and some group them together or hold them all under one. There are many ways to approach it. Again, this is where you rely on the advice from a local attorney and balance that with your personal situation (ie how risk tolerant are you, what are your goals, etc).

Personally, I put all my properties into individual LLC's. Yes, I am taking a risk for violating the due on sale clause for the ones with mortgages, but it's a calculated risk I'm willing to take. I like keeping everything totally separate/insulated, and I don't want to rely on an insurance policy to save me if something goes wrong.

In IN the fees were super cheap to get it set up. About $100 or so to form the LLC and then under $200 for the title company do to the quitclaim.

Not sure how much the timing matters on when to form the LLC. On a few of mine I transferred them to LLC's after having tenants in place. Again, I'll defer to attorney advice here.

All good, reputable companies I've used multiple times:

• http://www.bpgwi.com/
• http://www.securityhomeinspection.com/
• http://newstartinspectionscorp.com/

@Aaron Hunt I didn't mention any of my cars except the first since it's not really relevant to the discussion. If we want to talk cars though I'm happy to do so! I could chat all day :)

This is always a hotly debated issue. I'll chime in with my personal experience as an agent of 10 years and a car fanatic.

I believe part of being an agent is your image, and a nice car is a big part of that (yes, the degree of this varies depending on your market). Now, don't go overboard and buy a new 7 series BMW if you've only closed 2 deals. Even if you have closed 50, there are plenty of cars that provide a good balance of look/style and affordability. You want to look successful. No one wants to hire an agent who looks like they're brand new and haven't sold any homes.

When I first started as an agent I drove a 2003 Dodge Ram pickup. After my first year (which went well) I upgraded to a C class Mercedes. Yes, it was a Mercedes, but it was 4 years old and was their cheapest model. I spent $24k on it - no more than a nice Honda Accord. I instantly noticed a difference in how I was treated by both my clients and other agents. They immediately took me more serious. It also gave me more confidence and put me in the right mindset, which in turn boosted business. It the "dress for the job you want not the one you have" type analogy.

From there I've gotten nicer vehicles and there is no question they help my business. Think about it this way - if you were hiring an attorney, would you hire the guy who drove up in a shiny S Class Mercedes, or the guy who pulls up in a 2005 Toyota Camry. I want the guy who looks successful. I know that not all successful people drive nice cars, but lets be real - the majority of them do. Even if you say you should be judged by your work, not your look - keep in mind you get judged first, before you even have a chance to show them your work. If you get judged harshly (ie crappy car, etc) then you may not get that opportunity. 

Also, if you have a cool car, it's a great conversation starter. I can't even begin to count the number of conversations that I've had about my cars with clients or potential ones.

As a RE professional you can write off car payments (at least a portion) and depreciation. Leasing is a good option too - I believe you can write off the whole payment. One tip - buy a car that weighs over 6000lbs to take advantage of the "hummer loophole" - you can depreciate the entire purchase in one year. Great way to offset some taxes if you had a good year of earnings.

Full disclosure - with all that said, I'm in the process of selling my current car and downsizing to a much more affordable one to cut my car expenses by over 50%. It has nothing to do with affordability - I have become obsessed with the BP site and have set a goal of getting to financial freedom in 3 years, so I am cutting expenses where I can so I can buy more property. I am also shifting my business away from the traditional realtor duties to investing (flipping, new const, etc).

Congrats Kelly! You guys did a great job. Perfect example of how great the BRRRR strategy can be. Thanks for sharing!

In the agent business one of the rules I go by is if we have 10 showings and no offers, the property is overpriced. There may be nothing wrong with the unit except the price. People are obviously coming to see it, so it's not grossly overpriced and/or doesn't look bad in the pictures. You may be off just enough to keep people from applying.

Are you getting any in-person feedback on the unit? Are you following up with people and asking why they didn't submit an application? 

Based on what I see in the listing and what you've said, I would suggest improving both the pictures and the price. I would do at least $50 less - anything less than that won't make an impact. 

I agree with Katie that removing some of the personal items from the rooms before taking pictures is a great idea. Declutter and depersonalize is what I have all my sellers focus on when prepping their homes for market. For example, you have a picture with a closet door open and a laundry basket on the floor. All that needs to be cleaned up. Close the door, put away the clothes, hide the basket, etc. You can put it all back after taking photos. Do some light staging as well (maybe some flowers on a table, nice soap dispenser and trendy towel in the bathroom, etc). 

Speaking of photos, I always recommend professional photography. You should be able to find someone to take high quality pics for pretty cheap ($50?). They will have much higher quality pictures with better lighting, angles, etc.

As always, check with your attorney first to make sure you're complying with local laws. Some cities, communities, neighborhoods, etc, don't allow short term rentals (some HOA communities for example).

With that said, I don't see why it would be a problem. It's your property, and as long as you and the tenant agree to terms in writing (that don't break any laws), then those terms are fine. Write in whatever you want (ie tenant can move out anytime with no penalty with X days notice).

If you're not comfortable altering or adding lease language for that, like Wayne Brooks said, just do a mo-to-mo or week-to-week lease.

Curious though, from an owners perspective, why would you want to give the tenant an easy out? That's just more work for you, and will cost you $$ in turnover. I see you're looking to rent, but you said "also" which implies you may own a rental unit as well.

@James Zettelmeyer Everything I have read states 120 days for the appraisal, not 180. Not trying to argue, just trying to get some clarification.  I know these rules change all the time so I want to make sure we all have the most up to date and accurate info.

This is one of many places I've seen the 120 days referenced:

https://www.fhanewsblog.com/2018/02/fha-appraisal-...