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    Rental Property Investing: A Handbook and Guide for Becoming a Landlord!
    Rental Property Investing: A Handbook and Guide for Becoming a Landlord!
    Rental Property Investing: A Handbook and Guide for Becoming a Landlord!
    Ebook110 pages1 hour

    Rental Property Investing: A Handbook and Guide for Becoming a Landlord!

    By Revathi Raja Kumar and Saravana Gupta Ravindran

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    About this ebook

    A Handbook and Guide for Becoming a Landlord! from a real estate agent.

    LanguageEnglish
    PublisherRevathi Raja Kumar
    Release dateMay 18, 2022
    ISBN9781005113438
    Rental Property Investing: A Handbook and Guide for Becoming a Landlord!
    Author

    Revathi Raja Kumar

    I started my real estate journey when I bought my dream home several years ago. I didn't know a lot, but was very curious to learn more. This curiosity drove me to keep learning more. I refinanced the mortgage multiple times to take advantage of the lower interest rates. I refinanced to 15 year mortgage to lower interest rate even further.Had a mindset change to focus on expanding income instead of reducing expense. Explored further on this to understand the single family rental market. Spent several hours on BiggerPockets website to learn and then became a landlord. To expand my understanding further completed hundreds of hours of Pre-Licensure education, took the license tests on Mortgage Broker, Real Estate Agent, Insurance Agent, Notary Public and aced all.Teaching and helping others has been a passion for me since my childhood. I am passionate and dedicated in whatever I do. I became a volunteer to teach Tamil to kids. To take a step further became a woman entrepreneur to help others in their real estate journey.I am now a licensed Mortgage Broker in California & Texas, licensed Insurance agent providing services in California & Texas, Real Estate agent in California Bay area.Come join me and Let's make it happen!

    Read more from Revathi Raja Kumar

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      Book preview

      Rental Property Investing - Revathi Raja Kumar

      Revathi Raja Kumar & Saravana Gupta Ravindran

      Rental Property Investing

      First published by Fractal Infinite LLC 2022

      Copyright © 2022 by Revathi Raja Kumar & Saravana Gupta Ravindran

      All rights reserved. No part of this publication may be reproduced, stored or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, scanning, or otherwise without written permission from the publisher. It is illegal to copy this book, post it to a website, or distribute it by any other means without permission.

      First edition

      This book was professionally typeset on Reedsy

      Find out more at reedsy.com

      Publisher Logo

      I dedicate this book to my loving mom, beloved husband and my wonderful son for inspiring and supporting me through this journey!

      Contents

      About the Author

      1. Benefits of investing in Rental property

      2. How Texas is a Landlord friendly state?

      3. Mortgage Preapproval Process

      4. Loan Options for Rental Investment Property

      5. Home Searching Process

      6. Pros and cons buying a home in a HOA community

      7. Make An Offer

      8. Things to know about a seller’s disclosure

      9. Importance of Home inspection

      10. Home Appraisal process and its significance

      11. Landlord Insurance and Renter’s Insurance

      12. Title insurance and its significance

      13. Final walk through

      14. Set up Utilities

      15. Close your home & get keys

      16. How to calculate Rental yield?

      17. Pros and Cons of Using a Property Management for Your Rental Home

      18. Finding Tenants for Your Newly Purchased Home

      19. Qualified Business Income Deduction

      20. Rental Investment Vs REIT

      21. Rental Investment Vs 529 College Savings

      22. Rental Investment Vs 401k

      About the Author

      I started my real estate journey when I bought my dream home several years ago. I didn’t know a lot, but was very curious to learn more. This curiosity drove me to keep learning more. I refinanced the mortgage multiple times to take advantage of the lower interest rates. I refinanced to 15 year mortgage to lower interest rate even further.

      Had a mindset change to focus on expanding income instead of reducing expense. Explored further on this to understand the single family rental market. Spent several hours on BiggerPockets website to learn and then became a landlord. To expand my understanding further completed hundreds of hours of Pre-Licensure education, took the license tests on Mortgage Broker, Real Estate Agent, Insurance Agent, Notary Public and aced all.

      Teaching and helping others has been a passion for me since my childhood. I am passionate and dedicated in whatever I do. I became a volunteer to teach Tamil to kids. To take a step further became a woman entrepreneur to help others in their real estate journey. I am now a licensed Mortgage Broker in California & Texas, licensed Insurance agent providing services in California & Texas, Real Estate agent in California Bay area.

      Come join me and Let’s make it happen!

      One

      Benefits of investing in Rental property

      Chapter Separator

      Investing in Rental Properties

      Investing in rental properties include buying rental homes - collecting monthly rents and waiting for appreciation, buying commercial properties - leasing it to shops, restaurants etc, buying apartment complex - leasing to tenants and collect monthly rental bills. The choice depends on the individuals and their level of risk and comfort.

      To see whether a rental property will generate positive cash flow, you need to know how to calculate the rental yield of the property.

      Benefits of Investing in Rental Property

      Cash Flow

      It creates a positive cash flow as the tenant’s payment on rental exceeds the monthly mortgage payment and expenses on the property.

      Appreciation

      The property appreciates overtime or by the improvements made by the owner, the value of the property increases. The equity on the property increases overtime due to mortgage pay down.

      Leverage

      One of the important factor to consider investing in rental property is leverage. You can buy with only a percentage of the total money required (usually rental properties need 25% down payment) but you will get the appreciation and cash flow for the 100% of the value of the property. The mortgage on the rental property remains constant for 30 years, but the value of the property and rent increase overtime. Proper planning and budgeting is required before getting into the rental property investing and should be taken with a long term perspective.

      Control and Financial Freedom

      You have the total control over the investment where you can decide where to buy, what renovations can be done, how much to charge as a rent, You have very little control over stock market and other investments. Though there are risks involved in rental investing, the volatility is much less compared to other investments. Once the mortgage is paid off, you can live off the rent from the tenants which helps achieving your financial freedom earlier. You can also use the extra money from the tenants to pay down the mortgage early.

      Passive Income

      Investing in rental property creates a positive cash flow through the rental payments collected from the tenants. Though being is a landlord requires consistent effort as the property has to be maintained for the tenants, you can involve the Property Management Company to delegate your responsibilities. It reduces a whole lot of burden on your shoulders, thus making it a passive income with minimal effort.

      Capital Gains

      When you sell a property, the profit is not taxed like the ordinary income. Tax rate for Capital Gains are usually around 15%, while the average income tax is around 30%. 1031 exchange is another way to defer capital gain taxes and depreciation recapture taxes.

      Tax breaks

      There are numerous tax

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