All Forum Posts by: Account Closed

Based on what I've read, the deduction on your personal mortgage has been reduced to $500,000 on ANY NEW MORTGAGE and there is a repeal of the AMT.  Real estate tax deductions are still in place but State Income/Sales Tax Deductions are out the door.

From an investment perspective, the impact should be positive (with the removal of AMT if you are subject to AMT) and have no effect on mortgage deductions.  I haven't seen anything indicating a change to the $25k loss allowance limitation on property rentals and I haven't seen anything indicating a change to business profits and losses.

Walking into the basement of a home I bought at foreclosure auction and seeing mold on the OSB lined walls and on the ceiling tiles - my property manager wouldn't even walk into the basement.

Then after having the mold abated...getting a call from the property manager telling me about the basement walls bowing inward because of hydrostatic pressure that we didn't see because of the wall framing and OSB walls covering it...and talking to a contractor that estimated $15k in repairs (even though he outright stated his company didn't do that sort of thing)...then having a wall outlet issue in the kitchen upstairs, and having an electrician tell me he needed to re-wire the whole basement because the copper wire had been cut up.

Mold Abatement was $7,900

Hydrostatic cracks were sealed and painted over (no issues at all)

Re-wiring the basement $4,000

Much more reasonable than I anticipated.  It all works out :)

Use the desktop version rather than the phone app :)

There are multiple places throughout the Midwest.  I own two houses in Indiana - I paid $4,000 and $7,000 for.  Kentucky, Ohio, Tennessee (though TN is getting pricier), etc etc.  Do a nationwide Zillow search on homes between $1075 and $25000 and you’ll be surprised at what you find.

I would buy four single family homes for cash in the midwest.  Essentially, that would create a small portfolio of properties that would support itself...then I would look into expanding.

One possible reason a landlord would do this is you can get a policy, provide proof of insurance to the landlord, then cancel the policy.  If the landlord is named on the policy, then the landlord is also notified if you cancel the policy (which would put you in violation of your lease).

I would talk to an insurer about the amount of the policy - renter's insurance can also cover damages caused by the renter (you) and as well as the contents of the rental unit.  Sounds to me like the landlord has had a bad experience with tenants trashing houses and wants to cover himself/herself in case of losses.

I tend to shy away from multi-family for a single reason - exit strategy.

I could be 100% incorrect, but in my view, when you have a multi-family unit, and you go to sell it, you're going to have to market it to another investor.  I don't know of a single investor out there that wants to pay full price (aside from folks that buy turn-key).

My preference is to have the ability to sell the home to a much broader market - both individuals and investors when it's time.

Yes -

1) find and hire a registered agent (such as InCorp) and pay their annual fee

2) go the secretary of state's website where you want to do business - fill out the form, including the registered agent's name and address in the state.

3) file the form and pay the fee* - sometimes you'll have to wait for acceptance from the secretary of state (Arizona Corporations Commission as an example).

4) be prepared to file another tax return in that state (if that state has an income tax) once you start doing business there.

*Note - in some states, the fees are huge (Texas and California) and it may be easier for you to hold rentals in your own name in those states (be sure you have an umbrella policy if you're worried about liability).

It COULD be worth your while...or not.  In other words, it's risky - plain and simple.

The first thing you need to consider is if you are investing in an area where you can't foreclose on a property you've purchased a lien on for 3 years, you will need to upgrade the electric on the property.  That's a really big expense given the cost of copper wire.

If you are looking in to purchasing tax liens, I would encourage you to stay away from the lower priced liens.  Here's my experience:

I invest in liens.  My attorney charges $300 for the first step - sending out a notice to delinquent owners.  Think about that...when you purchase a lien, generally speaking you bid down the interest earned on the lien amount.  If that interest earned is less than $300, then you're already in the hole if you send out a notice and the homeowner turns around and pays off the lien.

I have liens that relate to vacant building lots in locations where the city doesn't generally assess (and issue additional liens) for issues like overgrown grass, snow that isn't shoveled, etc.  I foreclosed on a lien about two weeks ago and I foreclosed on another (according to my attorney) on Friday.  I started the process last February.  I will not have title until the court releases certified documents to the county treasurer and the property is deeded over to me (probably at least another month).  That's almost four years from start to finish.  You have to honestly ask yourself if you have patience to withstand that cycle.

If you're lucky enough to find a property where they are about to face foreclosure, and are still living in the property (this is not common) you have to understand that generally, these are folks that can't afford to pay their property taxes, let alone keep the property maintained and up to date.

There are some deals to be had.  There's a lot of disappointment to be had in the process (you need to manage your expectations).  It is NOT a get rich quick endeavor.

Here's my suggestion...in this order (to clean it up)...

1) Go to the auto parts store and buy some brake cleaner or engine cleaner (I like brake cleaner better).  Spray it on the stains, give it a minute or two, and spray it down the driveway (not into the adjacent grass).  You will have an area that is cleaner than the rest of the driveway.

2) Mix a bucket of water with some Dawn liquid dish soap.  Scrub down THE ENTIRE driveway with this solution with a push broom.  This will help even out the areas that are cleaner than others.  Rinse everything down.

3) Once the driveway has been scrubbed down with #2, while the driveway is still wet, spread some powder laundry detergent and scrub it down again with the push broom.  Rinse everything down.

That's probably your best bet.  My Dad made me do this when I was a kid - we used to replace engines to cars in our driveway due to having a home based transportation business.

If your contractor doesn't make you whole, that's the easiest solution...It's not going to be perfect.  Be sure to get it done before it gets too cold here in Colorado.