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Bank Account for R.E

EricBodin

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Dec 6, 2007
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Hi,

Does any one of you put a certain amount in the bank account for each property as a safety net in case you need extra money for repairs or suite not rented...? Would it be 1 month of rent or more??

Thanks,

Eric
 

MonteDobson

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Oct 7, 2007
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Yes a "reserve fund" is VERY important to incorporate into every purchase. I would suggest 1 month`s rent as a minimum. In some markets we are putting 2-3 months rent in a bank account as a reserve fund just to make sure.

I would also suggest putting at least 5% of monthly rents into the reserve fund as well as a great way to mitigate risk. You never know when the furnace or roof needs replacing.

Hope that helps...
 

EricBodin

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QUOTE (C2Ventures @ Apr 19 2008, 09:49 PM) Yes a "reserve fund" is VERY important to incorporate into every purchase. I would suggest 1 month`s rent as a minimum. In some markets we are putting 2-3 months rent in a bank account as a reserve fund just to make sure.

I would also suggest putting at least 5% of monthly rents into the reserve fund as well as a great way to mitigate risk. You never know when the furnace or roof needs replacing.

Hope that helps...

Thank you Monte, very helpful to integrate that amount in the purchase.

Eric
 
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