Friday, April 18, 2008

You own the house!

Hopefully you have now bought your first investment property. So you may be asking what next. Set up 2 spread sheets. One will be your tenant info. spread sheet and the other will be a cash flow sheet.

As you acquire tenants, fill the sheet with names, contact phone numbers, job information and be sure to have a column indicating if they pay on their own, if they have welfare assistance, social security or another government assistance program.

The cash flow sheet should begin with gross rents minus the property management fees. Then you should subtract out monthly expenses such as water, electric or fluke maintenance calls. Take the remaining number and subtract your mortgage. Your final column should indicate the left over cash after all expenses. This equals your cash flow.

Loral Langmeier always says, "Do your paperwork, or be poor."

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