All Forum Posts by: Jaret Lara

@Dave Foster That paints a clear picture, thank you. He has been depreciating the asset for 25 years. Will this affect him more if we did a hybrid deal with subto and seller carry?

@Bill Exeter I appreciate the detailed explanation. It gives me a clear idea as to the options, pros and cons, that are possible to structure something with the seller.  Thank you. 

@Dave Foster Thank you for taking the time and advice. Sounds like a 1031 exchange is the simplest form and would be the best option for him as to the taxes. 

Now with regards to the second option, can we do a subto on his mortgage and then 1031 the amount he will carry? If so, how does the 1031 exchange work in this case? Does he still have to buy another property with amount he is getting from the owner carry?

Hi Everyone, 

I'm looking for advice on deferred taxes on a possible hybrid creative finance deal I'm trying to put together on an off market property. 

This is the current situation:

House is 250K ARV, built in 1990, good middle class neighborhood in Indianapolis, house is in good condition, currently rented till March. Seller still owes 108K on the mortgage but has a good chunk in equity. He has been renting out the house 20 some years and also has been depreciating the property. He wants to sell but is hesitant because of capital gains tax that he may be hit with if he sells. I talked to him about a 1031 exchange as a possibility, which he may consider but he also has additional questions as to how the taxes play into a creative finance structure.

Given that he wants close to market value, its a good property and he wants to sell without being hit capital gains, I thought this might be a perfect situation for a creative finance. 

I'm a newbie in this area, and would like advice as to how to structure a hybrid deal. Also, what kind of structure would help him mitigate or defer taxes he may own if we go this route. 

I have to call him with a proposal of a deal. So, if anyone has advice for me I'd greatly appreciate it. Moreover, if anyone is interested in this deal to add to their portfolio and would like to work the deal with me, that's also welcome. 

Thank you for your time, patience and advice.

Mark Jaret

@Bruce Woodruff They have a 4 year of clean track record, so I’m hoping. Thank you for the advice.

@Brian Nally Yes, cash for keys seems to be the advice I’ve gotten. What is an average offered? Is it 1, 2, or 3 months rent? Is there a standard?

Thank you for taking the time to advice me. I appreciate it

@Marco Padilla thank you for the advice. Yes I thought of cash for keys. I’ll try that approach. It seems to be the easiest.

ARV 190K (complete cosmetic rehab)

Rehab 50K

Price 87K

2 Bed

1 Bath

Full basement

1887 sqft

* you could make another room and a garage to get the most

Hey everyone, I hope you guys are well and thank you for taking the time to read this. 

I have a house off market and at 50% discount of ARV. The deal is locked and loaded, but there is a tenant in place. They've been there for 4 years, never missed a payment and their lease expires May 2022. The current owner likes to have his rents under market value so he's renting it out at 600/month.

The intention is to flip this house whether I do it or wholesale it to someone else to do it. Im having doubts with moving forward as my money would be parked for 6 months in the event that the tenants want to fulfill the remainder of the lease. Is this is still a deal or would it better to walk away? Perhaps a seasoned investor with more capital would like it. Im fairly new so, 6 months seems like a long time. 

If you have any words or wisdom, Id be grateful. 

@Gil Keren I appreciate that. Thank you

@Gil Keren Thank you. I will reach out to her. Can I ask how has your investing experience been investing in Indy? Any tips?