All Forum Posts by: Steve Hall

I disagree with @Lynn M: You don't ask a tenant for anything. You tell them... (and always in writing.)

I disagree with @James Wise: You should never let issues between tenants take place in your units, especially if one of the tenants if violating the lease and the other is threatening to sue you.

Have you read this? https://www.sciencealert.com/incense-could-be-more-harmful-than-cigarette-smoke-researchers-find

Your lease should have clauses about health hazards, or open fire/burning. If not, it's time to fix your leases for the next time you renew. We all learn as we go...

If you can enforce this issue as a breach, be sure to follow the notice laws per your state.

If you don't have a provision in your lease about health hazards or burning/fire, I would inform tenant #2 (in writing, by certified mail, and posted to their door) that their actions are creating a potential health hazard for tenant #3 and that they are hereby required to cease and desist the burning of incense in their unit, immediately. I might add that I will waive any early termination fee, for the next 30 days, (notice to be provided within 3 days) if they wish to move out and find a facility that will allow them to burn incense.

I would also drop a hint (verbally / in person) that their future landlord(s) are going to call me for a reference and I would like to be able to tell them that "Yes, the tenant was very co-operative..." or "Yes, I would rent to them again".

@Troy Doney

The wording of your question says so much about your future: "What should someone have told you when you started?"

Nobody should have told me anything.

@Ryan Sajdera

If you need a secretary, go hire one part time for $10-$15 an hour. It sounds like you are just trying to find a place for a "friend" in your business. That's unwise...

@Charlotte Dunford

Did you read the CA/NDA? Most will have language to the effect that you cannot disclose or discuss any data or information that is deemed proprietary to the disclosing party and that which is not generally known to the public.

If you want to talk numbers here on BP hypothetically, I think you would be fine since numbers are not "proprietary". Just be mindful that the seller does not want the information about their particular offer/sale made public.

@Jeff Johnson

1/3 up front is WAY to much. 0% to 10% max.

The middle payments don't matter...

Always make the last payment 50% with any approvals or CO's completed/issued first, with a signed release. (If your last payment is less than 50%, they will drag out the job...)

Make sure that you have a well written contract that is very specific. It should require your written approval for anything running over 5% above cost.

@Kris L.

Yes, in many states a multi-member LLC offers more legal protection than a single member LLC. The biggest protection is from foreclosure. In some states, a creditor may be able to foreclose on (and liquidate) a single member LLC to collect a judgment. The flip side is that you've just opened up your multi-member LLC to your bother's liability. If your brother drive's drunk and kills someone, your LLC will be sued. You might prevail, but you will still spend a lot of money to defend yourself.

One alternative is to open an LLC holding company in a state like Delaware, Nevada, or Wyoming. This is because those states have great charging order protection. Their laws state that charging orders are the exclusive remedy for creditors of both single and multi-member LLCs. (No foreclosure!)

Ideally, you should have a single member operating company LLC in your state, which is owned by a Wyoming holding company LLC.

Read this article if you want more clarification on what I have said here...

@Nick Ruffini I disagree with @Greg Dickerson on everything in his post.

Being accredited opens doors for accredited investors. It does not prohibit them from buying a property with their close friend (even if the accredited investor takes a passive role.)

Regarding pooling your non-accredited money with an accredited investor's money "to go in on someone elses' deal"... this happens all the time in 506(b) deals. Keep in mind that if you and your accredited friend are partners of a LLC, then the LLC is NOT accredited.

I suggest you consult with your attorney before making any decisions based on BP forum advice.

@Michael J Martinez

Asked and answered dozens of times.

Please learn to use the search feature.

@Lee Haenschen 

How much have you saved up for a down payment in those 2 years?

If you've only saved up $10,000, then save for another 2 or 3 years, and keep educating yourself until then...

@Ashraf Abbas 

All that and no purchase price? No ARV? No NOI? And which tenant are you going to kick out so you can live there?

Bottom line: it doesn't sound like you've run the numbers.