Starting Off
I am just begining my journey on starting an LLC and aquiring some properties. In january I plan to take classes to be able to get my real estate license sometime between now and when I finish classes I will be getting my LLC and starting to setup my lease documents and other bits of documentation for my future properties. My hope is to have a process in place before I buy my first property. This will change a lot i understand once I learn from my mistakes but I hope to get a good baseline. I plan to buy and hold properties to rent them out.
My question is, can anyone think of anything i should be doing/setting up before i buy my first property? Should I approach some lenders? Any advice?
I would find out what you can pre qual for. Find homes in that price range and see what you need to cash flow.
Go around to different property management companies and ask them what a property would rent for. These people have the best idea of rental rates.
From there I would make sure the rent is going to be covering your mortgage and cash flowing. If not, find an area that you can cash flow in. Study and research your farm area.
Draw up a lease or have a lawyer draw one up. I sell copies of my lease and a packet of rental info to my clients in CO. see if you can find someone that does the same in your state.
GF
You should know up front that getting your first properties will be difficult if you are planning on buying them via the LLC up front. Most people that I know buy them in their own name and transfer them to the LLC later on.
You should also make it a point to read as many books and posts on this forum as possible to really understand what you are getting into.
Make sure that your properties cover ALL expenses. Not just mortgage. They should cover mortgage, insurance, taxes, maintenance, vacancies and unexpected big ticket repairs as well as any HELOC or other loans you took out for the down payment. Only if it pays for all of these and STILL has money left over can you say that they are cash flowing.
Do not get emotionally attached to any property you look at or buy. It is business and emotion will usually cause you difficulties.
Good Luck!
Plan on at least 20% down if purchased by your LLC. Interest rates tend to also be higher. This is all based on your loan to value ratio(LVR) and your bank. Good Luck.
Well I am glad i posted. Ideally I would like a no money down situation. With the best interest rate possible. So what you guys are saying is that I should by the property under my own name. Once i own it then move it into the LLC?
Exactly. There are tons of posts on this topic. Poke around the Law and Legal Forum for some of these as well.
Thanks all. And great point on the PFA tmpringle301.[ Edited by alexlev on Date 10/11/2005 ]
I will no longer remove anyone from a lease. I have had bad things happen every time I have.[ Edited by edmeyer on Date 10/11/2005 ]
Recourse for what? If she has offered to pay you for the damages done by the burning missile, it seems as though she is acting responsibly. I would think that your main issue is the continuation of rent payment since you can let the police and the courts deal with their domestic dispute. Certainly if the acrimonious behavior between them continues, you might want to act then, but why would you want the expense of a turnover? She sounds like she is trying to be a good tenant.