Posted by Ed Garcia on April 06, 2007 at 11:34:25:
Remember, financing is not carved in stone. The nice thing about dealing with small local banks is that they are portfolio lenders and can tailor the financing to the customers needs. I encourage building a relationship with a small local bank.
The value of an LLC is of course to protect your assets. However what you?ve got to be careful of Daniel, is that many investors start loading up their LLC?s with multiple properties and defeat the purpose of the LLC.
I?ve seen investors who would have the vast majority of their wealth tied up in an LLC and it was worth more then the investor. The answer is to have more then one LLC allowing you to put a few properties in each LLC. When doing larger commercial deals we usually have an LLC for each individual deal.
I agree with you when addressing SFR?s vs Commercial. When teaching my workshop, I define the two different investing philosophies. Real-estate investors are usually taught a technique, system, or method, but are not taught REI as a business. That?s why I not only teach Real-estate financing, but I also teach REI as a business.
The philosophy of REI in SFR?s is, ?a quick nickel is better then a slow dime?, creating immediate cash-flow as you have said you?re doing in another of your post.
Hold properties or portfolio properties should be commercial. The reason I encourage commercial properties for holding is because when purchasing a commercial property, you’re buying an income stream and this is a property that makes you money by design.
If you were to own 20 houses or a 20 unit apartment building, you?ll find that the apartment build is not only far less management intensive, but gives you a better bang for your buck as far as the size of the investment.
Ron Blackmore, is your dad? You?ve got a great dad.
I?m sure he told you that at one time he worked for me. I stole your dad from Beneficial Finance. He was managing the Riverside office and I was doing business with him and convinced him to come to work for me. He did a great job managing my upland office and then decided to go out on his own.
When a friend or someone would ask me to go to dinner, I always say, ?let me check with my bride?. I stole that phrase from your dad. I?d always get a kick out him saying that when I?d ask him something and he would have to check with his wife, he would say; let me check with my bride.
Believe it or not, this week I had to go to a funeral of a friend?s wife in Riverside and was thinking of your dad. I was thinking of calling him, assuming he has the same phone number, and seeing if he?d like to go out to lunch. You be sure to tell your dad that I said hello and that I hope things are going well for him and his family.