All Forum Posts by: Scott Smith

@Mindi Rosser It's called The Real Estate Nerds Podcast, and we have 12 episodes launching on September first. Glad to hear you're also a podcast fiend, everyone at my firm is (especially our writers and socia folks)! One of our very first episodes talks about how to make the most of your professionals. I believe it's #3, with IRA Custodian Scott Maurer. Looking forward to your feedback. Thanks for your insight!

My experience as the guest on Episode 109 of the Bigger Pockets podcast was so awesome that I decided to start my own podcast. I'm not here to plug it, but to get an idea of what kind of content the BP community would find useful. 

Here's what our current format looks like:

• Each episode features an interview with another investor. Some recent examples are Scott Sutherland, Rod Khleif (a motivational speaker as well as investor--man did he have some interesting psychology insight!), Scott Maurer, Fernando Aires, and many more. I'm hosting and often bring my lawyer's perspective with me to the conversations.
• We do "Best Deals" and worst deals (we call them "Bad Beats") episodes, and some contract forensics/deal post-mortem episodes as well.
• The main idea is to learn from both successes and failures. There's no hierarchy here. Just two people talking and trying to become the best investors possible. That's our vision for the audience as well: look at the human side of the real estate investing game to become the best possible version of you.

I'd really appreciate any insights, thoughts, content you think is missing out there in Podcastland, or whatever you have to share on the subject. What are some of your favorite podcasts? They don't have to be limited to real estate. What do you like about your favorites? Are there things you'd like to hear from a real estate attorney or your fellow investors? Is there something you think is missing in real estate content generally? Are you a member of an audience that doesn't get enough attention? It's all fair game, even if you're not the biggest fan of podcasts. Thanks!

@Heather Rodden As mentioned above, and as you've found yourself, a good attorney is your best bet. But since you're looking for information, I've found nolo to be really useful for quickly looking up statutes. No advanced legal knowledge required. My team recently put together a well-researched and handy list of landlord-tenant statutes by state that just covers the basics: security deposits, eviction issues, legal recourse against tenants, deduct-and-repair rights, etc. Fortunately for those who don't specialize in this area of law, the legalese translators gave some definitions for all of those terms too. I hope this helps!

@Account Closed is correct: even the happiest of partnerships get very messy without clear, upfront documentation. Agree on everything ahead of time and get it in writing.

You could structure the deal in a number of ways. A venture-specific LLC is a great idea, and I've written recently for BP about how to protect yourself in these agreements. Many of the comments there about Operating Agreements also apply to Partnership Agreements.

One issue you may consider when deciding between these two approaches is whether you need financing. It's easier (and cheaper) to get financing in your own name than it is to convince a lender to make a loan to your LLC. This is particularly true if your LLC is new. Incidentally, I've written about how to get around the due-on-sale clause you'll find in most mortgages with a few strategic moves here on BP as well. I hope this information helps you out!

@Harrison Russin Multi-family units can be very lucrative with very little down, depending on your market. There are some great resources out there for multi-family investing. Rod Khleif has some badass information about this that he gives away. I had the pleasure of interviewing him for my new podcast recently, and he had some great stuff to share on this topic.

The commenter above who mentioned the Delaware Statutory Trust (DST) made some good points. This is one way to manage this large project, and it's a particularly useful tool for California-based investors. Another way to do it would be to start small, and do it JV-style. You could form a Joint Venture Specific LLC and have a good real estate attorney draft an iron-clad Operating Agreement to minimize your risks, limit liability, and protect your personal assets all at once. So you've got options for how to approach this. If you want to learn some more about the Joint Venture method I mentioned above, my recent Bigger Pockets article on protecting yourself in a joint venture could be useful for your research. Don't go any of this alone, by the way. It's too much money to risk messing up over a boilerplate contract. Get yourself a qualified real estate attorney if you haven't already.

I love your enthusiasm! Learning all this stuff might seem "boring" to outsiders, but when you're new and looking at all these different opportunities, it really is fun. On a personal note, I've found that developing curiosity as a lifelong habit has made for a pretty fulfilling life, both in and outside of investing. You wouldn't be the first investor to get addicted to research and deal-hunting. But there are FAR worse things we could be addicted to, right? 

@Jason James Whether it's a good idea is going to depend heavily on your situation. For many of my clients, all of whom are real estate investors, the answer is "hell yes." There are tons of perks to using your SDIRA for nontraditional investments. After all, most investors get SDIRAs with Checkbook Control because they allow us to invest in the things we understand. For those of us here on BP, myself included, that's going to be real estate. Buying real estate with this method offers asset protection, creditor protection, and even a means to buy your retirement home ahead of time. Depending on your situation, there may be some financing advantages as well.

There are several ways to use IRA funds to make a real estate purchase, but the most direct (and easiest, for many investors) is with a Self-Directed IRA LLC.

As a lawyer, I just want to add that before you make any type of investment in this fashion, get some personalized advice from a qualified attorney. A good real estate attorney who also invests in real estate would be ideal. Most pros will tell you that you CAN make this type of investment, but they won't necessarily tell you whether you SHOULD. If you don't already have an attorney, check out the credentials and reputation of any attorney you plan to retain for this purpose to be sure they know their stuff.

@Sheri Cabral I don't believe I'm allowed to put my personal or business number here on the Bigger Pockets forum, but you're welcome to contact me or learn more about my firm from the information available in my profile and elsewhere on the Bigger Pockets website. I've written some articles for BP's blog that may be helpful to you as well.

Hi @Ron D.. I'm a Texas-based real estate attorney and fellow investor. Asset protection is my bread and butter, and I do endorse the plan that @Costin I. so helpfully outlined below. If you want a high level of asset protection, there's very little that rivals the Anonymous Land Trust paired with the Series LLC.

The most effective asset protection plans accomplish two goals: securing your anonymity and separating your assets. The Land Trust piece of the plan works by keeping your name off of public documents. You then use a corporate structure to hold your rental properties for you. The most successful investors rarely own their properties, they simply control them with corporate and legal structures. You can learn a little bit more about how asset protection can help you keep your pants up from my previous Bigger Pockets article on avoiding litigation nightmares. Fair warning though: this is an article about lawsuits. It's a gory business. You will learn the worst-case scenario, but also the good news that you don't HAVE to lose sleep worrying about lawsuits.

By seeking a competent attorney to assist with your asset protection strategy, you're definitely on the right

Okay here’s my legal perspective: Fortunately, you cannot be held legally liable for actions of ghosts (or any other imaginary creatures) on your property. Based just on the facts you have stated here and common sense, you don’t have any legal obligations to reign in spirits.

But of course, you might be the kind of landlord who wants to go above and beyond to ensure your tenant’s comfort and perception of safety. Bravo, you may be a nicer guy than I, @John Park! So here’s my perspective as a fellow real estate investor who finds the very idea of ghosts laughable. But like you, I care about my tenants having a good quality of life and relationship with me. Even if I find their beliefs crazy as all hell...

Do you know if this fear of ghosts is based in a religion? If not, most folk superstitions agree that a good old fashioned sage burning is useful for cleansing a home of unwanted spirits. It is also used in white magic spells of protection. Sage is cheap, and as a bonus, makes the house smell nice too!

@Michael Plaks You're correct that the banking system need not be complicated, particularly with the Texas Series LLC. I am an attorney and investor myself, and happen to fall into the camp of being a big fan of the entity for holding real estate investments. Many of my clients keep using the traditional bookkeeping methods they already had in place even after switching to the Texas Series LLC.

Ultimately, a Series LLC formed in a "friendly" state like Texas will be cheaper than forming a ton of Traditional LLCs, where you may have to pay fees and annual taxes. You don't have to be a resident of the state where your LLC is formed.