Real Estate Investor · Lake Balboa, CA · Member since 2016 · 75 posts · 31 votes
As I'm researching and reading and google searching and listening... I'm learning.
I just wanted to use this space to note things I learn as I learn them. I have absorb so much in the past month. Not looking for a lot of commentary but maybe you learned something useful today also..
(DSCR) - "Typically, most commercial banks require the ratio of 1.15–1.35 times (net operating income or NOI / annual debt service) to ensure cash flow sufficient to cover loan payments is available on an ongoing basis." Wikipedia
Not that I have been sleeping on the job... But more caught up in chasing shinny objects. Need to really sit down and focus where I want my attention.
Started reading "How To Win Friends and Influence People" by Dale Carnegie over the break. Really liking the message. For me as a manager of many in my day JOB I suffer impatience which leads to intolerance. So that's something I am actively addressing. Really want to start looking at what my employes want vs what I want of them.
As I have pretty much listened to all BP Podcasts now at least twice I have started listening to a couple others. This morning I was listening to Kevin Bupp Podcast 129 with Matt Theriault - Nice tips in here on finding deals. One recommendation is to go to Private Management websites and look in their "For Rent" section. Then targeting those. If an Owner has a vacancy he might be more apt to make a deal.
"Pari-pass - is a Latin phrase meaning "equal footing" that describes situations where two or more assets, securities, creditors or obligations are equally managed without any display of preference. An example of pari-passu occurs during bankruptcy proceedings when a verdict is reached: all creditors can be regarded equally and will be repaid at the same time and at the same fractional amount as all other creditors."
Knowing the general idea of a 1031 is to shelter capital gains taxes by transferring into a new property.
My quick take away - Dave mentioned 3 idea's I hadn't heard of. (I'm not a lawyer or a CPA or 1031 expert. Just noting what I took from the interview)
Death - 1031 Cap gains transfer to Heirs are evaluated at the current Appraised price of the property at death. There by transferring the Cap gains to heir with out the Cap Gain taxation. This seems extreme just to avoid a tax bill :-
Purchase 1031 in all cash. Refi out capital.
Transfer 1031 into personal residence to receive 250,000/500,000 cap gains exclusion. IE say you bought several condo's on the beach as rentals and some years down the line you decide to live in one of those. Then sell. You don't get taxed on the 500,000 (filing married) cap gains for your personal residence. Then you would need a new place to live and well you have that other rental... Then sell..
(Noting here that in the Podcast Dave explains rules based on Intention and time frames that I'm not really writing down)
Some other things I took away.
1031 between Personal Partners can be split on an individual basis based on the fact that all the Partners each file their own taxes. Should the 1031 happen inside a LLC only the entity that files taxes could 1031.
Reverse 1031 - too complicated to write in a few words but listen to the podcast. Pretty good info about Purchasing a property through an intermediate and then 1031ing a sale of the original property into the new property after the fact.
Over all pretty interesting stuff.
Hopefully the proposed GOP tax reform doesn't make 1031 obsolete.
(Also does the @persons name only work if that person is in the tread already?)
Hi @Greg C. I'm glad you enjoyed the podcast with Kevin. He's got quite a history and we had a great session talking about 1031 exchanges. Just so you know I hang out here as well willing to answer questions or be of service. @Joe Fairless from right here at BP did a similar interview as well.
The reason why the whole @persons name only works is that you can do @?persons name if they're in the thread. Or if you have connected with that person you can simply do @persons name and it will highlight. If they're not connected to you it doesn't work.
So right now I'm going to send you a connection request so we can just @ to each other.:)