All Forum Posts by: Bill B.

If you have a $200k loss there’s no reason to do a 1031. You’re going to have negative $30k in taxes. 

If you bought with a 1031 did you defer more than $200k in gains? If so, figure out how much if left in gains. Might be time to sell and take the money. 

If you decide to do another 1031 reach out to an expert like @Dave Foster. 

Good luck. 

You’re going to spend hundreds replacing the fridge and then spend hundreds per year on bottled/filtered water instead of paying a plumber a couple hundred once? Why?

Ps. Next time if you’re not going to use an inspector then do a basic inspection yourself. This is something you would have had the seller fix for you, especially if there was a water dispensing fridge installed. We haven’t even talked about the lack of ice make which is probably just as bad. If this isn’t a $40/night $80k property get water and ice working before first rental. 

I can’t imagine the returns you would have to generate. 22% federal tax, plus 8% state tax, plus 10% penalty. Take that 40% hit. Double your money on your 60% left over. Then when you sell another 22% and 8% on that gain? (30% hit on your 100% of your money and you’re back to 102% of what you started with. A total of 2% return for as long as it takes you to double your money. 

Why not just buy a new primary and rent out your current home. A year from now repeat that. You’re up 40% over your withdrawal plan. Heck. Stop making Ira contributions as you’ve learned real estate is a better investment. Use that money for real estate. I ended up with millions stuck in IRAs and roths I’ll never touch because of real estate. I learned too late, you still have time. 

EM doesn’t seem extremely low, just kinda low. Wouldn’t call it a red flag. 

Try a different lender? It seems like they are the problem. This should be a non-issue. It was obviously not an issue of the seller’s lender. 

Worst case you’ll get it back when they find another buyer. They can’t go under contract with a new buyer until your escrow file is closed. As you said, they can’t make him sign the release.someday they’ll fix this issue but until then you need a lawyer, or a new lender, or the seller needs a buyer.

Consider this a 2 on a scale of 1-10 for real estate problems. Good luck either way you move forward. 

Quick thoughts:

The man often called the richest in the world, works waaaay more hours and waaaay harder than you or I or almost anyone else in the world. Why? It’s obviously not money.  Maybe it’s making the world a better place, maybe he feels responsible for all the employees who have jobs that make their dreams and hopes come true? It just isn’t money. 
. 
My story, with 1/1000th his wealth (or less.) builds on Jay’s idea of zero debt (I only have a dozen homes worth mid to high 7 figures, but I owe zero.), along with his idea of where you come from and your life experience determines what you need to feel like you couldn’t spend all your money without wasting it. As a w-2 employee I never made more than $60k. My wife was a nurse who topped out after 30+ years around $80k. So call it $12k/mo combined was our best year ever. So when we hit $25k/mo it was stupid to keep working. But…When real estate literally takes less than 2 hours a month for me. If someone told me “you have enough” how would I quit doing it?

For me it was all about freedom. I couldn’t get fired. I couldn’t “lose” my job. I could fly home to take care of my parents with zero notice and stay for a month, or two. If I liked to travel I’d be writing this from one of those year long around the world cruises. But I don’t. “Find your why.” Always sounded stupid to me. But maybe it’s the same as “find your goal line.” What do you consider success. Time with family, giving to a preferred charity, or just having nobody buying your time. 

Check your local/state law. Every county I’ve declared a homestead made it abundantly clear that it was no longer valid the day I moved out. I’m not sure they said it would be a crime to “forget” to tell them I had moved out. But I am sure they talked about fines and penalties. 

You don’t really have a choice. I don’t know how 2 people got 3 homestead exemptions but that seems like something the local taxing authority could catch pretty easy. You’re defrauding the county of their tax money. It’s obviously something you want to cure before getting caught. 

Honestly if the property taxes are enough to make the rentals a bad deal I’d suggest selling. ESPECIALLY if you’ve lived in any of them 2 of the last 5 years and can take the tax free gain. 

Good luck and congratulations on your new home. 

You are preparing to give them $3,000/$6,000/or maybe $9,000 when they stop paying. Decide how much money you would willingly flush down the toilet. 

Ps. As I’m sure you’ve noticed by now. You could have hired a PM and been financially and mentally better off. If you’re right and this tenant would have passed their screening. Then right away the first time they were late they would have been hit with late fees and a pay or quit notice. Do you really blame them for paying people threatening them with late fees or repossession before you? You’re just sitting in the corner asking to please be paid. 

Please reach out to a couple local PM’s and see how much rent they would charge and what it would cost you. On a scale of 1-10 this tenant problem is barely a 6. If you get hit with an 8 or 9 you’re going to lose $10,000 or more, not $3-$6k. 

Let me get this straight. You want to judge every single landlord in the country. From a mom and pop with one home to the largest corporation in the country with the same brush. 

BUT, then you want those landlords to judge every single tenant individually and not lump them all together with the ones that lie, cheat, steal, and destroy the property on purpose?

If you truly don’t want to be misjudged by accident. Simply look at any large apartment building. You’ll be judged and screened exactly the same as everyone else that applies. It appears this is what you’re asking for?

In case you haven’t read the previous responses or haven’t walked a mile in a landlord’s shoes. 90%+ of your problems are caused by your local/state government that you seem to be giving a free pass. If, any bad tenant could be evicted in a few days and held responsible for the damage they caused. Landlords would be free to take chances on irresponsible people with bad histories. 

But the average politician doesn’t want renters living in houses in their neighborhood. They want them all jammed in large apartment complexes, run by large companies, in concentrated areas, away from them. They are trying very hard to make life impossible for the small guy. Think about all the theft from landlords during the rent moratorium. The government knew that money would never be paid back. Otherwise they would have paid the rent for the tenant and then been paid back by the tenant. But they knew it would crush small landlords while the big guys would be ok. 

You should definitely buy a property and give/rent out rooms to the homeless and disadvantaged. With your good credit you can get in to a home for just a few % down. Telling others how to help with their money isn’t helping. I doubt you want me telling you how you could help by giving your money to my pet causes. 

Are you trying to hand your “friend” a 50% taxable gain that you’re going to keep? Or do you plan on giving them the $1,500?  If you don’t pay the tax when you transfer the stock to them they’re going to owe the taxes on your gain and you haven’t really “paid them back”. 

The way I hear it is they gave you $1,000. You turned THEIR $1,000 in to $1,500. It sounds like you should probably give them the entire $1,500 if they’re your friend. WORST case. Sell,  pay the taxes, and give them their $1,000 plus half the after tax profits? You certainly wouldn’t just give them back $1,000, much less $1,000 and a tax bill. 

@Felicia Richardson just a note for the future. 

You cram all your responses in to one post and save time/effort @user2

That way you can thank @user3 for his comment

Tell @user4 their comment was useless

Ask @user5 to elaborate on what they mean

And so on to @user6 and @user7.