NEW GUY. COUPLE OF BEGINNER QUESTIONS.

whats up guys? nice to finally find a board that i think will actually help me in my future endeavors. anyway, i have been reading up but cant seem to get a clear answer so i figured i’d ask.

i’m trying to learn all i can and get myself into the REI biz. i just purchased a house and would like to do more. one of my questions is: should i start an LLC or a corp. before i get more involved in REI?

my next question is pertaining to land. i may have an oppurtunity to get some land before it explodes in price. however, it will not generate any type of cash flow. is getting into land a good idea as opposed to houses, condo’s, etc.?

The great thing about Land is the fact that they are not making it anymore. Land can be a great investment depending on the area. If they are building in a area and you buy and hold until you have one of the last build sites it will do great.

As far as a LLC I would do it you are going to need it anyway.

thats one of the main factors as to why i’m considering land…they arent making anymore of it. i’m in nevada right now so starting an LLC is actually quite easy. not to mention, its a way to get around some taxes.

Land and LLC, both great ideas. Talk to an attorney about how to maximize the use of your LLC though, it would be a shame to get it and not take advantage of all the benefits of it.

Hi Kayne! I am newbie from Nevada as well, I live in Sparks how about you? Have you read the Rich Dad, Poor Dad materials yet? Great practical info. and motivation from a guy whose done it. It is exhilirating and challenging to soak up and assimilate al of the info out there. REIclub is a treausre - I’ve found the audio training to be very helpful.

Have fun changing your reality!

Well,

My two sense.

First, Kiyosaki sounds very good - but his books are VERY basic and GENERAL. Granted I find his stuff educational in that it actually does help you see how Rich people think and live their lives. I mean, personal audited financial statements are something I never even heard off before I read one of his books.

But much of what he talks about takes TIME to cultivate. Investing through MAXIMIZING LEVERAGE (borrowing OPM) to gain financial “benefit” is VERY risky if you do not understand FULLY, what it is you are doing.

There are MANY qualifiers in his and other get rich guru’s books…

The biggest one is the word - IF

Such as:

IF you’re comparisons are accurate and IF you buy at 30% below market value and IF the property appreciates and IF etc. etc. etc.

The other things to consider are how many different ways many rei’s violate DOSC’s with their “techniques” to maximize leverage or “fib” to a lender “just a little” about x,y, or z.

As far as the LLC is concerned - it takes HARD WORK to realize the true benefits of such an entity. This HARD WORK is building a COMPETENT understanding of how LLC works in relation with your business goals

Don’t do anything until you have developed a good working knowledge of RE and have CLEAR goals (i.e. identify a niche in your market that matches your skills)

Read the thread “Asset Protection” just recently posted on here - it’s interesting reading. Read the links as well. Legalese is NOT my fortay and the LLC sure as hell lays it on thick. LLC is NO DBA, that’s for damn sure.

It’s like Kiyosaki says, to be captain of your Arc - you have to KNOW your business and you have to BUILD your Captain skills before just “changing your reality”. Remember - as Captain for your Arc - you are NOT a CPA or Lawyer - and do not rely on their answers solely as the Bible - again, you must know a little about a lot as a Business/Investor person. The CPA or Lawyer, regardless of how much they make are still in the E and S quadrant. [in this regard - identify a Lawyer who is VERY successful in RE and is in the B and I quadrant and develop a relationship with him/her]

I’ve been educating myself (some would call this “Analysis Paralysis”) for just about 4 months now. I’d say I have about another 4 months before I actually buy anything. I’ve got LLC ready to go. I have a CC with a hefty BUSINESS LOC. My “reality” is re is not making me any $ right now. And some would say, “jump in - do it!”

learn - educate yourself - then begin making your moves.

angele…i’m in vegas now. i moved from new orleans almost 2 years ago. not sure where sparks is. i’m probably going up to northern nevada and going to be looking at some land pretty soon.

i’m trying to figure out which reading material is actually worth reading and which material is not going to be of much use to me. i’m just getting into this so i’m trying to educatate myself atleast a little. land is less of a headache imo and talking to an attorney is definitely on my list of people to talk to.

k

TMCG -

First, I agree with you regarding your assessment of Kiyosaki. His Retire Young, Retire Rich was the book that got me started with RE investing. Definately not a “how-to” book (as he even exclaims), but more of a “why-to” book.

I also agree with your “get educated first” synopsis. However - and I’m pointing my finger at you, but making a generalized statement - there are people who take the “get educated first” mantra to an nth-degree. Meaning, they nevr feel they have enough knowledge, when in fact they do. They still let fear control their ability to “jump in and just do it.” I hear about people all the time that have this book, that CD, this course, and went to upteen seminars, yet still feel they need one more book/course/CD/seminar in order to fully understand things.

Each person has their own comfort zone, and each person will be different in when they decide to expand it (if, in fact, they ever do). After reading Kiyosaki’s book, I started combing the web for more-and-more info on REI. Still, it took me about 2 months before I decided to actually go from “learning” to “doing”. I decided I knew enough to lay down the book and start making offers. I admit I was still learning, but I’m still learning today, too. I knew what properties to look for, lined up my financing, and found a RE agent to make my offers through. Within two months and 15 offers, I had my first property. It’s interesting, but until someone has actually gotten a property under their control, they will never fully understand just how much education there is outside of books/courses/CDs/seminars - it’s just something that cannot be written or taught. Then you’ll ask yourself why the heck you didn’t start sooner. :wink:

Edit: As an example, there is a guy at work that I worked with on several projects. He and I used to “dream” about opening our own businesses. I ran into him several months ago after we went to different projects. Even after I explained to him what I had been doing to follow my dreams, he is still resistent to the reality. He prefers to continue working the 9-5 the rest of his life. What’s really sad is he has a $250k house which he bought with cash about 10 years ago and refuses to do anything with the equity just sitting there. He prefers to stay in his comfort zone regardless of the opportunities that exist around him.

Stephen,

Thanks for this VERY ENCOURAGING response. Just what I needed to hear. I am jumping in! I will learn until the day I die. Love it. But in every career I’ve had and adventure I’ve embarked upon the most valuable lessons have been learned though OJT. I do NOT want to get stuck, I’m movin’! Before you know it, my first deal success story will be on this forum!

Have a fantastic week!
Angele in Reno, Nevada

Point taken NoMoneyDown.

I had a nice meeting with a lawyer today who told me how “different” things are here in NY. Not only the market but the business of real estate.

i really need to join the local REI club here.

But I hear you.

thx for the replies guys. there are a couple oppurtunities that may be in front of me soon. i’ll keep yall posted.

k