All Forum Posts by: Crystal Smith

Hey fellow BP members, I come to you guys for some much needed advice. About 2 years ago I bought a property as my primary residence, It has been great but now I am looking to actually move up and tackle some of my REAL goals. I have wanted to do a flip for a while but have been unsure of how I should go about raising the capital. I have 720-760 credit and almost 25k in assets. My main issue is employment history. This makes it to where I will not qualify for a traditional loan. The property I own now has roughly 30k of equity in it with an interest rate of 5.8% I guess my main question is do I tap into the equity of my home to try and do this flip? I also would like to have a better primary residence. I am willing to put off a flip to move into a nicer primary. I just do not know how I would be able to get financing for another primary residence without qualifying traditionally besides a private money loan or hard money. I unfortunately do not know of any private money as I am sure a lot of us are in the same boat on that one! and hard money would be too expensive, Am I missing anything guys??? I appreciate all the help in advance and please feel free to ask me to clarify further on certain things!

Has anyone here moved out of state to start brrrr or house hack? If so, can you share your experience? I will be thankful. I live in san diego ca and plan to move to chicago to buy a triplex and make brrrr in the future.

Hello Experts,

I am looking for some advice on what route to take. I have a group of friends that they are looking to invest in Real Estate in some deals together, but we are not clear on how to make sure we structure the partnership correctly.

I am  in real estate investing since 2018 where I invested in Single Family on my own and holding rentals as well, but I have never done a deal with partners. I am also transitioning full-time to real estate so this partnership will see my friends as LPs and me as GP running everything such as finding the deals, rehab, operations, etc. 

Syndications seems to be complex in terms of the legal process, and partnerships are complex in differenciating who is passive and who is active.

What are the pros and cons? What would be your advise being in this position?

I talked with a lawyer but I am running into the problem that his recommendation seems to be what is better for him, so also in search for other real estate lawyers in the area.

Hi everyone,

I am 24 years old have been on and off of Bigger Pockets for a bit as I save up for my first home. I am 24, live in Seattle and just closed on my first home. The property is a single family home with a separate entrance into the unfinished basement which will be converted into another unit. While I am very excited about this purchase, there are some complications. This is where I desperately need you guys' help.

Before I bought this property, I worked for two years to save up enough for a down payment, closing costs, and 3 months worth of reserves. I am purchasing this home and have had the plan that my brother would live in it with me and help me pay the mortgage. The mortgage is roughly $4,000 so it will be split $2,000 for each of us. This is where things get hairy.

We had the idea that I would grant him partial equity in the property for paying half of the mortgage. I decided this because fair market value for rent on the entire house is roughly $3,000, which would make his portion of the "rent", $1500. So he is over paying by $500 to live here rather than rent at market value. I know this is not traditional as the whole point of house hacking is to have someone help pay your mortgage rather than give someone part of your home. I have also told him that we would split the renovation and whatever percentage of the renovation each of us pay, then we will retain that percent in equity depending on the increase in assessed value, post renovations. It has come to my realization as I put up all of the money I have worked so hard for, that he has no skin in the game. My name is on the title, not my brothers. And I worked everyday, ate almost every meal at home with cost effective foods and sacrificed 90% of my social life to be able to save the way I did. (Prior to graduating college and getting a full time job, I was an incredibly social person, so this was a huge change of mindset to sacrifice the way I did).

And on the other end, my brother decided to start his own business while I was working and did not work hard as he spent money like crazy and eventually went bankrupt (filed 1 year ago) . He is now doing well and getting back to where he needs to be. But I just feel like I am losing at my own investment by giving so much of the opportunity up to someone that did not do what I did to make this possible.

As of right now we have agreed that after renovations are done, if I were to have put more money into it than he, then he would repay me the amount to become 50/50 partners on this property. This essentially means that, during renovations, he has the opportunity to bring himself all the way up to 50/50 partners with me, or close to it.

What does not sit right is that I have created this whole opportunity and would like to feel compensated by retaining significant value in the project rather than opening the doors for losing 50% of my investment when I am certainly able to do it on my own. Can anyone help me out on a way to explain this to him without hurting his feeling or give me an alternative way to still make this seem like a valuable option for my brother without giving up such a significant portion of the equity in the property? While I told him already I will never cut him in on a deal out of "being my brother" I think it is right that I grant him some sort of value because he would be over paying on rent by $500 by living here and I have already told him I would give him an equity split, far more than what I will actually end up giving him in the end. This is my first investment opportunity and I have made mistakes and I need help trying to resolve them appropriately.

If any of you would like see the contract I have written up for this, please contact me and I can explain it more. A phone call might be nice too, so I can explain any further questions you might have.

I am thinking of making an all-cash offer to purchase a SFR with existing fire damage in the kitchen at a price well below market value The property is in otherwise solid condition and in a great neighborhood. I plan on rehabbing the entire property to BRRRR or flip it. What are the considerations I should be aware of in purchasing a property with existing fire damage? Are there any special protocols in repairing the fire damage? Once repaired, how does a history of fire damage impact the insurability or insurance premiums of the property? What about financing post-rehab? Once rehabbed, what disclosures would I have to make if I were to sell it as a flip? What disclosures would I make if I rent to tenants as a buy and hold investment?

I’m out of state but I want to invest in multifamily apartments in Chicago. I’ve read the post from other BP members and it’s clear that to be successful, I’ll need a solid team. I suppose this team includes: realtor, real estate lawyer and property manager. Let me know if you can help. Thank you.

1. It’s WHOLESALING, not WHOLE SELLING

2. It’s a job/business, not investing 

3. You CAN’T be successful doing it without capital

4. “Driving for dollars” is not a viable strategy; the people successful at wholesaling spend $10,000 + monthly on marketing 

5.  You need to know real estate principles, real estate law, and real estate finance.  None of these subjects are taught by wholesaling gurus 

6. You can’t be successful part time; it requires a full commitment.

7. In most common methods of wholesaling you are NOT a principal, you are an intermediary.

8. The law is not on the side of the wholesaler; states are attempting various ways of limiting wholesalers profitability.

9. Only a small minority of people getting involved in wholesaling are in any way competent 

10. Wholesaling does NOT lead to investing, studying real estate finance, principles and law and working for an investment real estate company leads to successful real estate investment. 

I have just purchased 1st rental, and under contract for my 2nd...Yeahhhh I am very excited. Both in my area. So I am interested in managing them myself in order to learn. But now come the details.

Question #1: I do not want them to pay rent to "My personal name". So, I will need to create an LLC for my real estate rental business. I have read many pros/cons about actually putting my property into the LLC. At the very least, I still need to do my basic LLC for my business even if I don't place properties in there yet correct?

Question #2: Placing property into LLC. The biggest disadvantage is not being able to do a cash our refinance correct? Otherwise, there is more liability protection with it being in the LLC.

Thanks so much for the feedback.  

April in Georgia

Hello to all. I am in desperate need of a good general contractor for a gut rehab in Southside Chicago. The property is a single family and I want to also turn the basement into living space. I already have architectural drawings. If you know anyone that is good and reliable, please send me the person's contact information. Thank you!

Hi , is hiring an attorney for buyer’s rep a good idea? What are the benefits ?