Starting An Investment Group
What is the best way for me and a two more investors to go about setting up an entity to invest in apartment buildings as a group effort and what is the terminology for this concept...LP? Has anyone done this? Where can I find out more about how to facilitate this and get it started.
Thanks all,
God Bless
I would look into an LLC with 50/50 ownership. That way you dont have liability. With an LP the general partner is totally liable and the limited partner(s) have liability to the amount that is invested.
what is a private placement memo and Reg D? And also, what is GP?
GP= General Partner...I would assume the Private Placement info relates to securities regs???
Reg D - The section of the securities code that defines how a small, private placement to qualified investors can take place and stay within the law governing the offering securities to the public.
More or less when you want to raise $1M from the public without listing the shares publicly (IPO, shares listed on an exchange, etc).
State and Federal laws apply. Costs around $30,000 to $40,000 for the legal and accounting work. A major part of the costs is the production of a prospectus for the deal.
John B. Corey Jr.
This is a complicated issue and there is no one size fits all, and you should be wary of anyone who gives you a one size fits all answer. Get a business attorney who speciallizes in business entities within your state. Your local guy that did your will and sued your car dealer for you is probably not qualified to give you good advice in this area. Also check out ****Must participate a while before posting URL's*** this is the site of Garrett Sutton a Rich Dad Adviser. Very bright!
Have you tryed calling a mortgage broker? Seems that they could quickly tell you your options.
Mike,
Whenever I am thinking about paying a loan off early, I sound out the existing lenders to see if they would take a discount for an early payoff.
Hey I know someone who can get you into a loan today. With a score of 760 you should be able to get %100 financing. Her name is Andrea and her phone number is 714-813-8982.
Mike,
Is this a multifamily property? The responses make it sound like a single family property....
Susan
[addsig]
Mike, we are loan brokers too, and do business in CA, Are you in califonria, if so send me details about the property, Is it a duplex?
send me details at **Please See My Profile**
What is the loan amount? You should probably be in the 8-10% range. How much are you paying for this rate? Give me details and I can see if I can help. You can IM me.
Rule of thumb regarding financing...if the cap rate is less than the interest rate, it will not cash flow....
[ Edited by commercialking on Date 05/27/2007 ]
I would hire someone with a CAM or real estate license that way they will know the laws regarding property management. The most important thing is not to break any laws. With a real estate license you know that the state has checked them out. Here in Florida I would pay someone around $12 a hour, but wages vary by market. Good Luck!
Kim - So I want to know how many times he called back asking when the job started.
I am facing a similar situation. I have managers for all long distance properties, but I wind up handling the office work which is pretty mundane. Many parts of what needs to be done are computer automated and I have developed many tools that give me leverage, however, there is still much manual labor--most related to the sea of mail that comes in.
I have been thinking of finding someone who wants very part time work or possibly a student with some spare time. Any one have experience with hiring such a person?
A big thanks to all those who responded. It was nice to get a fresh perspective as well as first hand stories of hirings. I think I am going to try to sub out some more of the yardwork, maintenance, etc. although it bothers me to pay money for work I can easily do myself. For example, it takes me about 10 hours a month to do lawncare. For a lawncare service to do the same work, it cost me $600.00 per month.
The most important thing I have learned since my initial posting is that I have come to the conclusion that I was being "dime-wise and dollar-foolish" with how I was spending my time. In the grand scheme of trying to run and expand in real estate investing, things like mowing the lawn rank pretty low. My time is much more valuable spent finding deals and making "big picture" decisions.
Thanks to all who have posted thus far and if anyone else has an experience, advice, etc., on how to go about weening yourself from mundane stuff to focusing on big picture investing, i would love to read about it.
Plus, if anybody would like to share tips on how to safeguard against employee theft, preventive measures, etc., that would be great.