All Forum Posts by: Henry Clark

In Zagreb Croatia.   Met with a realtor today.   Will meet with a Commercial realtor later with them. 

US citizen can buy in Croatia.

Interest rate is 3.5 to 4%.
15 year term

Will ask the commercial realtor if there is a balloon period, Or if the loan amort period can be 20 to 25 years. 

Downpayment 10 to 20%.

Can’t wait to discuss income/property taxes, insurance, or other country specific issues.  

Earthquake about 3 years ago.  Lots of repair construction.  Would be great impact on a Storage business during renovation.  

OP. View each one independently on their own.  Then step back and see how they impact each other.  Especially on timing of close.  

If you have a lender, then the question of 1st lien position and LTV% may come into play.

 It’s been a while since I watched the presentation.  But the big kicker is you never pay the “loan” off.   You just die.  

Can’t remember why I say the person should be a child.  Believe it had something to do with the annual withdrawal a person might make when an adult.  

OP might be talking about a different product.  The product we looked at.

Minimum $300,000 input every year for 10 years.  So you need liquid cash.

You never pay the loan off until death benefit.

Returns were a lot higher than is mentioned.

This to me only looked good for a person less than 20 years old.  So you would do it as part of an estate plan to keep wealth going in your family.  

The pitch was more about living income versus a way to bank for investments.  

Numbers seem astronomical out in the future but if you NPV them great, but not astronomical.  

I actually liked this from a passive standpoint.  But can make way more investing.  This is great if you have a generation who can’t get it done with investing.  

OP. As mentioned they need to talk with specialists.  To many questions on an open forum.

1.  Early depreciation, can wife qualify as REP?

2.  His w2 upfront can he ask for deferred compensation instead?

3.  What does he do?  Can he invest in office space?

4.  Kids, deduct their college costs by paying them to advertise.   Depends on his business.

5.  Have they fully maxed out savings?

6.  Hopefully they paid ahead on their taxes.   They should have more cash on hand if they did not.  They should not have paid down on properties without setting aside for taxes. 

Really need to attack the W2 angle.  

Need a professional to go thru their entire portfolio and tax positions.  

OP talk with your 1031 Intermediary.

1031 can’t be between the same parties.  
Even with the legalese.  

Outside of will and trust I would consider the impact of 2 things in your planning.  Depends on your estate size.

1.  If you or your parent or parents go to a retirement home.  $6k to $10k per month.  They have to pay before Federal coverage kicks in.  You can only have $2k cash to their name.  Also they will look back at least 5 years for any asset disposition.  If they gave you assets say 2 years before, 100% of it has to come back as an example.  So plan dispositions at least 5 years out.  Which older people don’t like giving up control.

2.  Use the $250k capital gain avoidance. $250k each for spouses, plus $250k for any other listed owner.  It is usually better to sell the property and take the tax avoidance versus holding it to generate income.  I would rather avoid taxes on $500k appreciation than rent the house out long term.  

The will and trust definitely help with probate and to also follow your instructions.  

Read my post “What happens if you die?”.  

OP check your deal analysis process out.  

1.  I failed to include interest during construction. Added it to my deal analysis format.  $60k

2.  Failed in my water.  $150k.  Had a water hydrant on property.  Found out it was a private hydrant for the next door complex.  Was same owner at one time.   Added it in our deal analysis.

Build a checklist or deal analysis that will catch all of the big issues.  If you miss landscaping for $2k it won’t kill you.  


Don't just do fix flip. Look for unfair advantages. 1. Personal life, 2. Worst house in a great neighborhood., 3. ADU say a 3/1 into a 3/2., 4. LT capital gain tax rate., 5. $250k gain exclusion, etc.

OP we work in 2 markets.  Each one we stick with our Realtor on both the buy and sell side.  Can call them anytime.  Plus their offices have plenty of team members to pick up if I can’t reach them.  

Gets back to building a team.  Give your agent the easy Buyer agent commission.  

Sold our 2nd lot this year.  18 total. Doing good about 4 months into opening.  This buyer bought a small lot of about 2.3 acres for $90,000.  So no logic thus far.  Both the largest and the smallest lots have sold.  Good to have a mix. 

This buyer had been stationed at the nearby military base and wants to retire here.  Even though both buyers are using bank financing they are both existing home owners.