All Forum Posts by: Todd Rasmussen

@Sean Tong

Go knock on doors, meet your future neighbors, and ask directly. People love talking about what they got a builder to add.

@Will Trammell

Congratulations on number one. We started with property management and don't think we'll ever stop. I do plenty of things myself, but I enjoy not being on call all the time. Couple ways to size an umbrella policy, 1 is to analyze your assets and do it based off that, but I have always preferred to do it based on what is an amount that guarantees my insurance company would want to defend me. 1 million to start is pretty popular.

@Shane Duncan

If you have any friends in the business you can pass capital through them to create an added layer of separation as well.

@Vi Prich

I think your gross rental margin is enough to justify keeping it as a rental. Just keep placing new tenants and every year with fixed mortgage amounts and increasing rents will feel more comfortable. If this experience has left you soured on owning rentals or you need to take advantage of the step up in cost basis, you can wrap your existing mortgage and sell and then you wouldn't have to feel like you wasted what is essentially now a 5 year principal only loan.

@Eric Rice

What type of investing are you planning to do? Long distance and first investment I'm assuming you're looking at rentals, in which case I'm not sold on Franklin. Franklin is a beautiful town that everyone wants to live in, but as a result prices are very high and I'm not sure you are going to get as much of a return as you could on the other side of Nashville. We have scaled in SFH rentals in Clarksville to the point we "retired" last year and moved out here from Los Angeles to do it full time.

@Courtney Rodes

If interest rates are going up, then the principal amount has to go down in order to have positive cash flow. Decreasing the principal of the refinance means you are leaving money in the deal or lowering your holding costs, rehab costs, financing costs, or acquisition costs. One variable doesn't put an entire strategy out of business, it just means you have to adjust a different variable. In our case, it's finding properties for lower acquisition pricing or on creative finance terms that allow them to cash flow still.

@Chris Charlton

We use state farm. You can review the estimate they used to come up with your coverage amount and might find they have some input wrong. Insurance coverages vary slightly state to state, but in CA, IN, TN, and KY they can write ACV polices too, although at that point, just going self insured might make sense, you are getting pretty close to the number when people start to consider it. Ask a contractor the cost /sq ft to build and compare that against your coverage A divided by sq feet. as an additional check if you are concerned.

@Nick Williamson

We went with and then went to TN. You can make money in any market if adaptable enough.

@Sarah Jenson

Kids are notorious for ruining family businesses. Most of the time because they have a better idea. Learn everything you can from how your parents have created the wealth now at your disposal and do that until you can repeat it successfully. Making mistakes with debt service is going to be exponentially harder than making mistakes without it. Once you have their system down, you can start making small changes that you can reverse if needed. If you have wealth you have the luxury of investing it conservatively and still having a very comfortable life and growing that wealth for the next generation. Leverage is a great way to grow, but comes with higher risk and debt is impatience expressed financially. Full disclosure, I used maximum leverage to scratch my portfolio into existence so my kids can by properties cash someday.