All Forum Posts by: Will H.

Ah - gotcha. You're referencing the fact that an LLC owner can be held liable if they personally commit fraud or act negligently. That's usually right, hence the need for insurance. Thanks for clarifying!

Bit confused by what you're referencing here Lynn. The standard caveat of this not being legal advice applies, but the "pass-through" status of an LLC is generally a reference to tax liability, not tort liability. As far as I'm aware, you're protected from personal liability with an LLC so long as you A) don't make any personal guarantees (or violate a law which specifically creates liability for the owner, like a failure to make payroll tax payments) and B) keep the business separate from your personal finances and activities so that there's no opportunity to pierce the corporate veil.

What do you mean by "pass-through liability" here? Interested, since I haven't heard of it before.

I would especially want liability insurance if the property isn't held under an LLC. You're about to be running a rental business, and you don't have any of the corporate protections, so insurance against injury, property damage, etc. is a must have.

No problem! You would have to evict if they didn't leave (assuming NYC is the same as MA). It's winter now, so that would be my primary concern. Housing courts are usually loathe to evict tenants in the winter.

If it's a good deal, it may still be worth moving forward on. If the seller won't agree to wait on closing, I would make sure that your client consults with an attorney to get an estimate of the worst case scenario. That way they can factor any potential eviction costs into their financials to confirm that the deal is worth it.

This is definitely the best move. It could turn into a mess if they buy it tenanted in the winter, and since your client is an investor they can probably wait to close until it's sorted out by the current owner.

Leases stay with the property, and it looks like NY law is similar to our rules here in MA, so your client would have to give all of the tenants at least 30 days notice to vacate. If the end of the current lease term (usually the end of the month) if less than 30 days away, you usually need to bump the notice to the end of the next month (e.g. if you give notice on November 24th, so you'd have to give the tenants a December 31st end date). This includes the tenants without leases.

The tenants without leases are treated as tenants at will, and have the same basic protections as the tenant with a lease. Like MA, it appears that NY requires a 30 day notice to quit for tenants at will: http://codes.lp.findlaw.com/nycode/RPP/7/228

Also, be aware that, if NY is as friendly towards tenant as MA, your client is going to run into problems getting the tenants out in the winter if you wind up in housing court. I might have your client chat with an attorney about what (if anything) can be done to avoid that before moving forward.

This is bang on. I don't have any specific info on agencies in WA, but you're going to want to focus heavily on training and agent support when you're interviewing at brokerages. Do they have a training program they use, or is it a, "My door is always open," situation (you want an open door, but not just an open door)? Do they have classes or dedicated coaches? Is there any mentoring? Etc.

You really want a structured training program when you start out. The first year can be really tough for new agents, and you don't want to be left to your own devices. If you're not given training and support, the statistics show that you probably won't make it through the first year.

Also, get reading (or listening, if you prefer audio books)! The Millionaire Real Estate Agent, How to Master the Art of Selling, and How to Win Friends and Influence People are great places to start building sales skills. Most training programs will recommend at least one of those, so it never hurts to get a jump on things.

Hope that helps, and good luck!

It'll depend on the state you get the license in, but in Massachusetts you're looking at the following costs:

• 40 hour pre-licensing class: $300-$400
• Licensing test: $101 ($56 if you have to retake it)
• License: $103-$150 (your first license goes to your 3rd birthday, so they prorate the fee depending on how long it's good for).

All in, you're looking at a max of about $651 in Massachusetts assuming that you pass the test the first time. 

Also, keep in mind that you'll likely incur some other startup costs when you join a brokerage. Joining the local association of the Realtors is the biggest cost (around $500-$600), and then you have your MLS subscription, desk fees, business cards, and so on. In total you'll probably pay somewhere between $100 to $1000 in startup costs, depending on what your broker requires, when you join a brokerage.