Nevada Real Estate Laws and options for creative financing

[Don Spafford]

I am seeking help from the BP community for a question about laws and options in Las Vegas, Nevada. I have a friend there who bought a condo in a nice area about a year ago. He likes the single life and doesn't want to feel tied down so prefers to rent. He wants to sell the condo. I want to buy it to hold as a rental. But he doesn't want to sell it so soon and possibly have to pay capital gains tax and I want to avoid all the extra closing costs and fluff going through a lender.

So the question is, does NV laws allow for a wrap or even a transfer of title? Basically I am thinking I can just pay him $20k or whatever, then take over the loan. I could just basically do that anyway, but I would like to get the title and everything in my name so I can claim the interest and take the depreciation, etc. I would like to keep the mortgage he has since it would be a lower interest rate than what I can get as an investor. What would be the best option here so it is a win-win? Are there other options that would work in NV? Or does anyone know if I can still assume the interest and depreciation even if it stays in his name?

[Art Ritter]

... or, your Las Vegas friend could form a Nevada LLC, put the condo into it - with its financing intact, and sell his interest in the LLC to you.

No closing costs when the LLC (and thus the property) is sold, no change to the mortgage deal, member(s) of the LLC are shielded from this property's landlord liability - which may be particularly important once this is a rental, and the profits/loss are passed through to the LLC member(s) as this entity is disregarded for tax purposes. No Nevada tax or franchise liabilities until it nets a $4 million in income.

Just a thought - but, review with a competent tax professional regarding capital gains liabilities.