All Forum Posts by: Ryan Saulle

I don't have rentals with tenants like you and I know it will be a pain to get all your accounts switched but I personally had nothing but bad experiences with big banks and I haven't been in the game that long. Since then I talked to a few investors in my area and now I switched to a smaller local bank who actually appreciates my business. I hear it's good in the long run if you develop a good relationship with a small bank.

Ryan

Hey Naeem, I'm not a CPA or attorney and you should run it by both to see what they suggest, but how I structure my deals:

1.I have an entity set up (S-corp as well as an LLC) and you can draw up promissory notes with them stating they are lending you $XXX on date XXX and you have to pay them back by date XXX with an interest of XXX%. Doing this you can also secure the promissory note with the property/Deed of trust(if you don't pay them back, they can take the property).

You can put in there a no pre-payment penalty as well. So if you owe them that money with interest a year later and you flip the house in 6 months, there is no penalty.

Another way is they can both get their own attorney's and have them write up contracts and give it to your attorney and everyone signs that way.

2. You can also set up an entity with multiple owners 33% each. I have never flipped a property outside of an entity so I don't know the process but I'm sure you can buy it in all 3 of your names as well.

Either way i would ask a CPA / Attorney in your area. Hope this helps!

Ryan

Absolutely. 50K can go a long way. Every partnership and deal structure may be different but if you have no experience in flipping I would suggest to attend some local REIA meetups in your area. www.biggerpockets.com/events and see who is flipping around you. 

Hope this helps, 

Ryan

Hello Rob, nice to meet you and welcome to BP. 

Seems like you have a great plan, keep at it and you'll make it happen! The BP articles, forums and podcasts are great place to start.

Good luck going forward and feel free to reach out if you have any questions.

Ryan

@Zander Dragony Hey Zander, I am not a CPA or attorney and don't like giving legal or tax advice but I personally have my flipping business set up using an S-corp.

One piece of advice I will give you is if your CPA is looking for "simplier", I would find another CPA because he or she may not be looking out for your best interests.

Hope this helps.

Ryan

@Account Closed Hey Robert, I would start by going to local REIA's.

You can find some in your area by going to www.biggerpockets.com/events

Ryan

Hey Prince, there are many ways you can structure a deal. 

Are you doing all the work and someone else is bringing the money / credit and you're splitting 50/50?

Is it for a flip? A buy and hold investment? 

How do you plan on purchasing the property? 

@Hunter Harms On my first flip I used the BP fix and flip calculator. I would highly recommend using that calculator! 

The monthly mortgage should be pretty easy to figure out if you're using HM or a private lender, the property tax can be found online you like said and as far as electric, gas, water and sewer I just estimated what I thought it would be knowing the area and I added a little extra $ to each just to play it safe. If you think the water, electric, and gas would be $50 each a month, I'd put them all at $60-70. Doing this worked for me and left me with extra profit, but if you want an exact number you can call the utility companies in your area which Bob suggested. For the insurance quote, when you call an insurance broker or agent in your area you may need a 6-12 month Builders Risk and General Liability policy. Hope this helps!

Ryan

@Domonick Dangerfield. I'm not to familiar with the mortgage pre-qualification of 1099 employees. I would reach out to a mortgage broker and see if you're able to get approved. My agent @Michael Lee may be able to help with this topic. Also i would suggest reading @Brandon Turner book: The book on Investing in Real Estate with No (and Low) Money Down! Hope this helps.

Ryan

Have to agree with all the comments above. @Charlie DiLisio Nailing the ARV is the most important thing, from there you can work backwards. Then comes estimating the rehab, I would suggest reading The Book on Flipping Houses and The Book on Estimating Rehab Costs by J Scott if you're just getting started. Next is the location, make sure its in a desirable location that people are looking to buy in as @Christopher B. suggested. 

Last, ALWAYS ALWAYS run your own numbers! The BP fix and flip calculator is great for that. Sometimes people try and tell you the rehab cost and what the ARV is. 9 times out of 10, I disagree. Hope this helps! If you ever want to reach out feel free to PM me.

Ryan