All Forum Posts by: Brian M Sweeney

@Ian Middleton LLC is the most common for flippers. Are you going to be having partners? Investors?

@Peter Lim I would agree with @Karen Rittenhouse you need to set a solid foundation first. Don't try to piece together structures, etc and end up cost yourself more in the long run. 

@Salvador Aldrett you need to be asking yourself if the juice is worth the squeeze. If you aren't getting the returns you are accustomed to then you may need to adapt and find other sources or locations of deals. Nothing is going to work consistency forever. Although they may be small towns if the deal makes sense, give it a shot. 

@Hunter Fitch I dont think it was a matter of whether he was going to pay them or not. Rather the fact that he needed borrowed funds to pay the taxes..says to me maybe the cash flow really isnt what it seems. 

Recently ran into a situation where a friend had asked for tax advise regarding his RE taxes on 15 rental properties that he owns. His question was: 

Should I get a line of credit in order to pay my RE taxes every year? 

His taxes were roughly $20,000 per year, not escrowed. 

My answer was: It Depends. 

It depends on how disciplined you are as a investor and financial manager, etc. Using a line of credit for a large tax bill isn't a crazy idea. Many business owners do this.. but it is only used successfully if you are disciplined enough to pay the line back down. 

His rationale was that he 'just doesn't have enough cash' to pay the taxes. Usually in these situations you will need to reevaluate cash flow to see where exactly the money is going and if the property is actually cash flowing as much as you think it is. 

Interested to hear everyones thoughts. 

Do your due diligence. 

Most people that aren't familiar with your situation or the area aren't going to know if it is a good deal or not. I have made and have had clients make tax sale purchases that have worked out tremendously. Others not so much. 

Do the research.