All Forum Posts by: Stephen Dougherty

I am planning to move my 5 SFRs rentals to my LLC; however, when I mentioned this to my Property Manager she informed me that if there was a need to do an eviction she would not be able to handle it and my LLC would need to have an attorney handle the eviction process. Is this correct? Has anyone had to file for an eviction as an LLC? What sort of attorney costs are involved? I am weighing the pros/cons of moving the properties to my LLC and this just got added to the con side. Even if this is true I probably would still move them to the LLC since just for the accounting, some tax, and personal/LLC asset and liability segregation.

My wife and I just sold our veterinary practice and have been in real estate about 8 years.  My advice would be to focus on your Veterinary career first.  That is what you have invested a huge chunk of capital (your student loans) into and is going to produce your biggest return (salary as a DVM).  Once you have graduated and worked for a bit then I would get into real estate.  You should have some good cash reserves before getting into real estate, and I wouldn't suggest piling on real estate debt on top of student loans before you have graduated.  My wife and I didn't settle down and start real estate investing until about 10 years after my wife graduated from vet school.  We fell into real estate investing when we bought our clinic and the building, and then bought our first rental house a few years later.  Keep in mind that my wife and I lost everything in the 2007-2008 financial crisis and we learned a lot about the importance of having financial reserves.

My accountant mentioned this to me the other day.  I think it works for anyone who has pass through income but I'm not sure how you have to be structured to take advantage of it.  I have a meeting with him after Thanksgiving to find out more.  Best bet is to talk to your accountant or to find one.

I generally don't like the idea of borrowing against a 401(k) for any reason mainly because of risk that the loan will be called due to something outside of your control like losing your job.  I had a coworker who took a loan on her 401(k) to use as a down payment on her house.  Our company was sold 6 months after she took the loan which triggered her 401(k) loan to come due (we were all terminated and rehired by the acquiring company).  She defaulted, owed a bunch of taxes and penalties, and she nearly lost her house.