Vetting a General Contractor for Cosmetic UpdatesVerify licensing (Maryland MHIC) and insurance—search the state’s public lookup.Walk through an active job site (not just finished photos) to see how they manage dust control, material storage, and crew organization.Start small.

Material misrepresentations or omissions on the Application will constitute a default under the Lease or Rental Agreement between the parties, and applicant will be responsible for the cost of any background checks performed.

Little emphasis is placed on off-market deals or alternative acquisition strategies like contract assignments.

Failure to Disclose Material InformationThe agent withheld updated info (a new, favorable rehab bid from the contractor) after the walkthrough.That info might have changed the investor’s mind — and since the agent knew it, failing to relay it is a material omission.3.

LTRs offer stability, while STRs can produce higher returns, but come with more risk and management needs.STR Tax Advantage: If you materially participate (100+ hours and more than anyone else), you can qualify for the STR loophole, allowing bonus depreciation to offset W-2 income, without needing full REPS status.Use Cost Segregation: Ask your CPA about doing a cost seg study to accelerate depreciation, especially if 100% bonus depreciation returns in 2025.Backup Options: If managing real estate feels overwhelming, consider a Delaware Statutory Trust (DST) for a passive 1031 route, or an installment sale to spread the tax burden over time.Meet with your CPA and 1031 intermediary to ensure your reinvestment strategy is tax-optimized and aligns with your comfort level on risk and management.This post does not create a CPA-Client relationship.

Are there alternatives? 

I'd start looking at rental comps to figure out what materials other investors are using. 

They buck the passive rules for 469, and are considered active.BUT - As with any other business, to deduct the losses the owner must materially participate.Material participation is achieved by:1.

If a dwelling unit is abandoned after the time prescribed in subsection J of this section, the landlord shall send the tenant a notice of abandonment by certified mail, return receipt requested, addressed to the tenant's last known address and to any of the tenant's alternate addresses known to the landlord.

I have grown a little uneasy with how things are going with the person with whom I am paying the loans for, and I am considering looking for alternatives.