All Forum Posts by: Jeff N.

Thanks for the great input. I definitely liked Chris' suggestion of using a type of operating procedure as a guide of business activities.

My main concern is to ensure my beneficiary is not taken advantage of by unscrupulous people in the event I'm gone.

I'm a new construction buy and hold investor so the 50% rule doesn't work out to well for my investments either. But I typically place a large amount down.

However, If the reason you are getting 100% financing is because you have no reserves, then you are definitely adding a lot of risk. Even with my new construction investments I have had my share of issues early on that could have been tragic if I didn't have adequate reserves.

Yesterday I was cleaning out my office and I realized that I hold the only key to my business accounting and operations. I started wondering how my wife or someone else would figure out my investments in the event I die prematurely. Taxes, HOA dues, tenants, mortgages, PM's, LLC's, etc, would be nearly impossible for my wife to figure out on her own.

How do you organize your business in the event a guy driving drunk back from the bar decides to end your life early?

Hello Dan,

I have also been researching some condos in Florida. I have been researching on the gulf side, but my concerns are the HOA's and insurance. An insolvent condo association can kill your cashflow.

I did some research on the community you mentioned and I found a few condos listing the condo fees at $300/month, which isn't too bad considering all the amenities they seem to have. But I couldn't find any association minutes or balance sheets for public view.

There are a few Florida investors on here that may be able to give you some insight on this area.

Can you quitclaim to an LLC if a mortgage exists on the property? Must you get the lenders approval or do you risk getting your mortgage called.

On the 2nd unit that needs repair I definitely suggest you make if rent ready and to code before renting. Trying to do this with a tenant in place is more difficult and opens you up to liability issues if not to code.

On the unit with a tenant already in place. If the going rent is 700 and he is only paying 625 on a month to month with a 250 deposit you could offer to keep the rent the same as long as he signs a year lease and contributes an additional 250 towards the deposit. If you raise the rent and loose the tenant and go vacant for one month it would be the same as keeping him at 625.

I was definitely timid on my first deal also, but I learned quickly that there is a direct relationship between how prepared and professional you are and how many late payments you receive.

The key to making this situation work would be your PM. You basically would be placing your asset in his/her hands with little oversight from you. If you had a responsive PM you trusted it certainly could work, but living across the globe with a questionable PM would make your life hell.

Thats great you were given this opportunity, but I doubt you will get the answers you need off this post.

It's such a huge learning curve to jump into an owner of a property management company. Without previous experience working under a PM firm you have your work cut out for you. Good luck.

After reading a post on hear about "Do you tell your friends you invest in RE", I remember a comment someone made to me concerning RE investing a few years back.

This person found out I purchased a home as a buy and hold for rental income and made the comment, "Thats just too risky". Meanwhile this same person just purchased a new car at 42K.

Granted RE does have its risks, especially if you were caught up purchasing in overvalued markets the past few years. But what has more risk, purchasing a vehicle at 42K costing you $700/month for the next 5 or 6 years or purchasing a rental unit with 42K down netting you $400 month positive cashflow after expenses, plus the possibility of appreciation?

Granted your risks are limited with the car purchase, where the RE purchase has the potential of unlimited risks, but over the long haul I'm betting on the RE investment as a low risk investment.

I have found that most friends are bored of this subject, especially the ones that do not invest. I do not talk about RE investing unless its with someone that shares the same interest.

As far as coworkers, thats a definite no for me. coworkers typically do not want to hear about your investments.