All Forum Posts by: Edward B.

@Vahe Ohannessian, trusts do not provide much asset protection, but they do complicate things for the litigant. Again, if he chooses to go hard core the trust probably wouldn't stand up, but lawsuits (and especially the threats of lawsuits) rarely go all the way. It is not nearly as cut and dry as if it were in your name and it may not be worth his time and effort to deal with it. I guarantee you that his attorney is, at best, telling him the same thing, that the trust PROBABLY won't hold up. How much is it going to cost him to find out for sure? And if it did hold up for some reason is he willing to eat that cost? 

It allows you to negotiate from a stronger position as well. Since it isn't cut and dry and there is at least some risk that he will walk with nothing he may be willing to settle for much less just to be done with it. 

Bottom line, I suspect you are in a much better position for having used the trust than had you not.

I started buying in 2001 and just retired last year. I can't even count how many times I moved in between and that's not even counting deployments. So, yes it's totally doable. I'll second everyone else, though, and say to make sure you are buying right. If it won't cash flow the day you buy it, it probably won't cash flow when you move. And please make sure you know what it means to have a property truly cash flow. I bought when the numbers worked and I rented when they didn't, like in SoCal and NOVA.

@Vahe Ohannessian, you may have saved yourself by using a trust as well. I have a friend that avoided a lawsuit because he used a trust and the case apparently wasn't strong enough or worth the money to try and go through it. Only a lawyer can tell you for sure, though. And by "for sure", I mean they can tell you whether or not you have a decent chance of coming out ahead if this guy pursues it and what the best course of action at this point is.

@Carloz Gil, getting more credit to fix your problem is like putting a band aid on a sucking chest wound. It is not going to address the overall problem. It seems like you are looking for a quick fix which may wind up getting you into even worse shape if you are not careful.

From a practical point you want your overall credit utilization to 30% or less at a maximum. Some say only 15%-20%. Can you even qualify for enough credit to reach that? If not you are wasting your time. Also, your score will take a minor hit from the inquiries.

I would not take out more credit card debt that I didn't need just to accomplish what you are suggesting. 

@Robere Istatia, for a performing note none of your money is involved. Escrow is the amount that the lender holds in order to pay for the taxes and insurance on the property. It protects you by ensuring those items are paid on time and not allowed to lapse. It is the borrower's money, though, not yours. It is totally transparent to you and does not impact your return in any way, other than your cost for servicing. The terms of the contract will dictate whether or not taxes and insurance will be held in escrow and the servicer should handle all of that for you.

No @Mark K.! Just no! I gave up on my ability to pick individual stocks a long time ago and you will not suck me back in!

I am very content with my strategy of asset allocation and diversification that I only look at and rebalance once a quarter. I found that I was very good at finding and buying good stocks and terrible at selling them and in the end not doing much if any better than my current strategy. My life is WAY simpler now, at least on the stock/bond front. 

While the majority of my net worth is in the stock/bond markets, I prefer to look for outsized returns in the real estate and note markets where I believe more opportunity exists due to the relative inefficiency. It is significantly easier to develop and hone competitive advantage in various niches and analyze deals vice whole companies with significantly more variables.

Thank you, but no thank you, Sir! Good luck to you.

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@Jaime O'Gorman, it is very helpful if you have your criteria written down and document that you apply it to any and all applicants. That will ensure that if you do get questioned you will be above board. Otherwise they could make the argument that you rejected them as a smoker, but really it was because they were a protected class. Which would be true if they could prove that you allowed other smokers that were not necessarily protected.

@Jaime O'Gorman, what specifically are you looking for? They aren't specifically mentioned in the Fair Housing Act because they are not protected. The Act is meant to make it clear exactly who is protected, the fact that smokers are not mentioned directly or indirectly is why they are not a protected class.

 16% annual return since 2005 is truly astounding. Very very few active managers come even remotely close to that kind of a return over more than a decade, especially that decade. People would not hesitate to invest in that kind of a return with a proven track record. You should consider starting your own fund, you could literally be a billionaire. 

@Robere Istatia,

Performing notes are very easy.

1) They get paid monthly just like you. The biggest service they provide is ensuring that you are in compliance with the myriad of state and federal laws. The also do the accounting and will issue 1098s to the borrowers. They can monitor escrow for you as well among other things. For a performing note you can get servicing for $25/mo, $35/mo with escrow. Some servicers may be less, some more.

2) Depends on the servicer, but there are plenty that will let you board one loan with them.

3) Many servicers can walk you through the process. Several have a department that handles non performing assets. The quality of that service is typically fair to horrible. I would get somewhat to very familiar with the foreclosure laws in any state that you are doing business. If you are buying decent assets, foreclosures will be uncommon and certainly not worth worrying too much about. Less than 5% of decent loans go all the way to foreclosure and it is not as bad as you might think. The law is on your side.